Are Casual Games Dead? Viximo and Z2Live Founders Weigh In Coast-to-Coast on Social Gaming Movement

There’s a little East Coast-West Coast brouhaha going on in the world of video games.

I just spent a couple years in one of the casual gaming (and core gaming) epicenters of the world—Seattle. Little did I know the city might be becoming a graveyard of companies stuck in the past. At least, that could be true of casual game developers and publishers who are late to the social gaming party.

That’s according to Brian Balfour, the founder of Cambridge, MA-based Viximo, a startup that makes software to help Web publishers, social networks, and social game developers make money from sales of virtual goods. Previously, Balfour founded a couple of startups in social networking and interactive entertainment, and worked for ZoomInfo; plus he’s an original member of the co-working space Betahouse, so he’s very in tune with the Boston tech entrepreneur community. He currently serves as Viximo’s vice president of product marketing.

Balfour wrote a provocative blog post earlier this week, detailing his thoughts after attending the Casual Connect conference in Seattle last month. In the post, he gives “three reasons why casual gaming is over,” and talks about what traditional casual game studios and distributors need to do to get with the social program. (For starters, it sounds like Casual Connect should integrate its panels and programs on social gaming with the main-hall presentations. Balfour says social gaming was relegated to a separate venue across the street.)

Traditional casual game companies “largely missed the boat,” Balfour told me in an interview. “Their existing models of downloads and ads are completely broken.” What’s more, Balfour says, their traditional distribution models (content portals and gaming sites) don’t work as well anymore. Big studios like EA have the resources to make strategic acquisitions and catch up, he says, but most smaller companies won’t.

Balfour didn’t want to call out any companies specifically. But I will. Seattle is home to many casual-game pioneers, like WildTangent, PopCap Games, Big Fish Games, and GameHouse (RealNetworks); game distributor Oberon also has a strong presence there. Here in Boston, GSN’s WorldWinner is one of the leading casual-games producers. To oversimplify things a bit, most of these companies made their hay with paid-downloadable or advertising-supported games that people generally play by themselves. Adjusting to a post-Facebook and Zynga world, where lots of people play games with their friends and compete for virtual goods and prizes, is a big challenge.

“A lot of casual game companies are in a tough position,” Balfour tells me. “But they’re not going to plummet tomorrow. Many will make their attempt at social games, but only a few will make a successful transition. The other majority will fail, and will consolidate for cheap amounts.” In any case, he adds, “It’s obvious a lot of those companies are on the block to be sold.”

It’s clear that Balfour and Viximo, being in the virtual goods business, have an interest in seeing the social games revolution gain steam. But knowing Seattleites—and their fierce pride in the region’s gaming expertise—I figured I’d get a strong reaction to Balfour’s argument from the Northwest. … Next Page »

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3 responses to “Are Casual Games Dead? Viximo and Z2Live Founders Weigh In Coast-to-Coast on Social Gaming Movement”

  1. David,

    Thanks for the comments on my post. I think we agree more then we disagree. I’m interested in hearing your thoughts in regards to your first point. If some of these companies are doing $100M plus, why do you think they aren’t getting more aggressive with acquiring talent, content, distribution in the space if they know they have to move in that direction? Seems like there are a lot of people just standing on the sidelines watching the game fly by them.

    Brian Balfour

  2. Steve says:

    I figured casual gaming consolidation was inevitable for a few reasons:
    1) Many companies, limited space (even if that space is the wired population of the world).
    2) Some companies simply will do better, shaking out some of the competitors or leaving them open to acquisition.
    3) Larger companies will see the successful ones and buy them since it’s easier than starting from scratch.