"Excuse Me, I've Got To Take This Game"

With more folks using their cell phones to play interactive games, some big names are looking for ways to translate pleasure into profits

Bjorn Idren lay fast asleep on the couch in front of his TV last month when his cell phone gave an ominous series of beeps. An incoming call? Nope. It was a drive-by shooting. "Bjorn, wake up," shouted his girlfriend, Sophia Eriksson, 26. "Someone is shooting at you!" Rather than dive under the couch or reach for a sidearm, Idren, 28, grabbed his phone. Too late. He had taken a wireless bullet.

As the No. 1 wireless assassin in cell-phone-crazy Stockholm, Sweden, Idren has notched a record 170 "kills" in the wildly popular wireless game BotFighters. Idren is known far and wide for zapping other players with his Ericsson R520 handset. His getting shot was a blow to his reputation in the new realm of BotFighters, an increasingly popular game played on cell phones throughout Sweden.

BotFighters allows a player to create a robot that's housed in their mobile handsets. The player chooses the robot's armor, shield, and eyes, and then set it upon other robots by sending text "attack messages" to the central game server. Those messages are relayed to their unlucky victims in the form of beeps.


  How seriously do people take the game? After getting caught with his radar guard down, Idren quickly revived his handset and used the radar to determine that his opponent was 9,000 feet away and driving off fast. He was out of range for a wireless bullet, so, hoping to exact revenge, Idren and his girlfriend gave chase. They shadowed Idren's opponent for a full hour at high speeds on the highway but couldn't get close enough to pull the trigger.

Since Swedish wireless provider Telia started offering the game this spring, more than 2,500 players have signed on. A very involved player like Idren, who says he plays about half an hour a day, pays $5 to $10 a month on top of regular cell-phone charges. That's the kind of passion and money that warms the hearts of carriers, cell-phone makers, and game developers alike.

Video-game fans already pay $11 billion annually for software, cartridges, and game consoles such as Sony's PlayStation2. Wireless games could be both more ubiquitous and more integrated into daily life. "You are walking around in an adventure when you are out on the streets," explains Sven Halling, chief executive of It's Alive, the company that developed BotFighters.


  Carriers hope wireless-game revenues raked in from bored commuters and hyperconnected kids will help them recoup their investment in next-generation wireless infrastructure, so-called 3G, which already stands at more than $100 billion worldwide. All told, it's a market that could be worth $6 billion in the U.S. and Europe by 2005, with Asia expected to be even bigger, according to Datamonitor.

With more than 600 million cell-phone users worldwide, the potential customer base is huge. And many of these people have time on their hands. That's particularly true in the U.S., where commuting times are an average of 50% higher than in any other country, according to the tech consultancy Yankee Group. Customers "want to have something fun to do when they have nothing better to do," says Jeff Hallock, director of consumer marketing for Sprint PCS, which offers more than 40 wireless games.

That appeal is expected to fuel an increase in U.S. wireless-game users to 280 million in 2006, from 16 million this year, according to wireless consultancy ARC Group. In Japan, wireless Internet leader NTT DoCoMo found that mobile entertainment was the driving force behind 52% of its wireless Internet revenues. That overshadows other wireless services, such as music delivered over cell phones. Of all wireless Internet applications, "consumers are only willing to pay for [text] messaging and games," said Eric Goldberg, founder and president of wireless gaming company Unplugged Games, at a recent wireless conference.


  For carriers and cell-phone makers, games can offer a way to differentiate their products and generate more sales. "There needs to be a reason to buy new handsets," says Matthew Feldman, president and CEO of Versaly Games, a mobile phones games provider. "And gaming is one reason."

Versaly Games in March joined Wireless Knowledge, a joint venture of Microsoft (MSFT) and Qualcomm (QCOM) , to create next-generation wireless-gaming applications. Also in March, handset manufacturer Motorola (MOT) cut a deal with Sega to develop games for its handsets. In April, Ericsson (ERICY) formed a joint venture with PlayStation2-maker Sony to develop handset-entertainment applications. And Finnish cell-phone giant Nokia recently formed Club Nokia, an online community that allows Nokia handset users to download games and screen savers from the Web onto their mobile phones.

The largest U.S. wireless carriers, Sprint PCS, AT&T Wireless, and Verizon Wireless, offer dozens of games. Hundreds of thousands of U.S. customers already play simple phone-embedded games, such as the Hangman word game or Wireless Pets, an animated program allowing users to select a virtual pet and care for it by shopping for its food and taking it to shows.


  The hottest games, though, take full advantage of the multiplayer, interactive environment of the wireless Web. Gladiator, a fighting game in which players challenge each other to head-to-head arena combat and grow stronger with each win, is the most popular game on Sprint's network. The game brought in more than 3.2 million extra minutes of airtime in the first three months after it launched in October, 2000.

Meanwhile, Japanese phone users have been reported to skip out of meetings when they receive a virtual bite in the interactive fishing game Fisupeli, the most popular mobile game in Japan. Targeted at the youth market, Fisupeli is hooking plenty of adults, too.

Although wireless games hold tremendous promise, the field is already crowded and lacks a tried-and-true business model. Two possibilities include charging users monthly subscription fees and giving winners points that go toward airtime discounts, with carriers profiting on the extra minutes used. "It's very much up in the air as to who is going to make money off of wireless games entertainment," says Knox Bricken, wireless analyst with Yankee Group.


  Another problem: Clunky wireless handsets with better color capabilities and larger screens have to be adopted for wireless games. And wireless companies and game developers must wait for the phase-out of the still-prevalent slow networks that allow for only crude games. But as carriers increase their networks' speeds from 9.8 kilobits per second to 50, wireless games should become more attractive and complex as developers take advantage of the extra juice.

Some analysts also contend games won't prove a panacea for all that 3G investment. "It's far-fetched to expect that wireless gaming on the phone will justify the costs of 3G implementation," says Forrester Research analyst Charles Golvin, who admits gaming will nevertheless play a big role. That said, the precedent for a hefty game industry is clear: If the carriers, game makers, and handset manufacturers can find millions of people who think like Bjorn Idren, they might win -- big time.

By Olga Kharif in New York

Edited by Alex Salkever

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