Comic-book villains like Magneto and The Green Goblin typically only blow up imaginary buildings and the occasional costumed crusader. But a new deal that will send Spider-Man swinging onto cell phones promises to help explode the market for mobile games.
On Monday, mobile game maker Mforma Group announced a deal with Marvel Enterprises to license its catalog of characters for use in mobile phone content. The agreement will put more than 5,000 characters including the X-Men, Captain America, the Fantastic Four and the Incredible Hulk into applications like custom ring tones, screensavers and games.
Mforma will co-produce the games with software developer Activision, and then will distribute them through its network of more than 100 wireless carriers in 39 countries, including Cingular Wireless, a joint venture of SBC Communications and BellSouth, and Verizon Wireless, a joint venture of Verizon Communications and Vodafone Group. Mforma will also create and host Marvel Mobile, a site accessible via phones and the Internet that will have links to Marvel content. Terms of the deal were not disclosed.
On the rise
The mobile gaming market is currently a relatively small one, but deals like this one are starting to help it boom. In 2004, about 10 percent of all wireless customers in the United States — about 18.7 million people — used their cell phones to play games, producing revenues of about $203.8 million, according to In-Stat/MDR. Over the course of 2005, the number of gamers is expected to rise to 27.3 million people, and revenues should surge 87 percent to $382 million. By 2009, In-Stat predicts the market will be worth about $1.79 billion.
Those revenues are particularly important to cellular carriers, who are relying more on data services and add-on charges to buoy their bottom lines. Phone companies typically charge users several dollars to download and run a game, and make additional money from the extra minutes users consume off their calling plans.
Content providers like Marvel are also bullish on the mobile gaming market. Cell phone games not only provide a new revenue stream, but allow businesses to make money off of their characters in regions where their books or movies don't actually sell. Take China, where government regulations keep most Western movies off the shelves, but rampant piracy means that plenty of consumers own and have seen recent flicks like "Spider-Man 2."
By selling a Spider-Man game through Mforma and its Chinese mobile partners, Marvel can capitalize off the phenomenon, and exploit the huge and growing Chinese cellular market, where there are more cellular handsets in use than land lines. "You can't monetize in China, even though the brands are there," says Robert Tercek, EVP of programming and chief strategy officer for Mforma. "This is a way to get money from the brand."
Mforma isn't the only startup scrambling for traction in the space. Last week, THQ Wireless — the mobile subsidiary of software vendor THQ announced a deal with Lucasfilm to create phone content based on the "Star Wars" films.
And the startups are growing quickly. Jamdat Mobile — which has content deals with companies including Nickelodeon, New Line Cinemas and Major League Baseball — completed a high-profile IPO in October, raising over $100 million. Observers expect Mforma to go public some time in 2005.