There’s No Console-ing Game Maker

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There’s No Console-ing Game Maker
Ed Del Castillo

Pasadena game developer Liquid Entertainment long made video games that were played on computers and consoles. In a typical game, players battled enemy forces.

But Liquid’s newest title is a Facebook game produced with entertainment blog Deadline Hollywood. There are no battalions to marshal; instead, players pretend they’re making it big in the movie business.

Liquid has all but stopped making the PC and console games it developed for the last 12 years, and started creating social games for Facebook and mobile games for smart phones instead.

This may not be merely one company’s change in direction but a sign that traditional game developers are starting to see a big future in games for social networking and mobile devices, said Billy Pidgeon, senior analyst with Encinitas consulting and market intelligence firm M2 Research.

“I see Liquid as an early mover into social and mobile,” he said. “I do think that it’s the beginning of a movement.”

Actually, Liquid’s change didn’t have an auspicious start. Liquid released its first social networking title on Facebook last summer with gaming website InstantAction. Called “Instant Jam,” the game required users to play the notes of a popular tune, similar to “Guitar Hero,” using a keyboard or “Guitar Hero” controller. But InstantAction filed for bankruptcy in November, shutting the game down with it.

Meanwhile, Liquid continued developing its more traditional games. “Thor: God of Thunder,” a game published by Sega for Xbox 360 and PlayStation 3, came out in May.

But Ed Del Castillo, the company’s president, said Liquid now plans to focus on social and mobile games. He sees the switch as a way to keep Liquid relevant to gamers as their interests change.

“We’re fools if we ignore what’s happening on mobile and social,” he said. “Being a businessman, I have to look at where the business is.”

Del Castillo would not disclose revenue, but said Liquid is profitable.

The mobile and social game industry has seen significant growth in the last few years. Developers of Facebook and iPhone games have proliferated; the games are easier to make and distribute than the traditional games sold through retail.

While social and mobile games have boomed lately, the retail video game business has struggled. June sales of packaged games and consoles totaled $1.03 billion, down 10 percent from $1.15 billion in the same month last year, according to NPD Group in Port Washington, N.Y.

Because of slowing retail sales, the industry’s biggest publishers have cut down on the number of games they produce. That’s resulted in the shuttering of both in-house and independent development studios.

Going casual

The 45-person company, which Del Castillo founded with Mike Grayford in 1999, got its start with a computer game called “Battle Realms” in 2001. Liquid’s first console game, “Rise of the Argonauts,” hit shelves in 2008. The titles follow a story line and ask players to make decisions that affect how the game continues.

Most games for Facebook and mobile phones, however, are casual games, which have a less complicated structure. For example, in iPhone hit “Angry Birds,” players use virtual slingshots to hurl animated birds at evil pigs.

So far, Liquid has launched only casual games for the social and mobile markets. The “Deadline Hollywood” game, which is in a testing phase, lets players pick a career path, such as director or producer, with the goal of becoming a Tinsel Town power player.

Del Castillo said the company is developing more complicated games for social networking sites and mobile phones that would attract a similar audience as its PC and console games. Liquid will launch a Facebook game for the “Dungeons & Dragons” franchise with Atari later this year and plans to create a mobile game using the characters from “Battle Realms.”

“I believe there’s an entire group of people who want to play more complex games in casual places,” Del Castillo said.

The change in Liquid’s direction isn’t definitive, however. Del Castillo said that the company could make a console game if the right circumstances presented an opportunity.

One benefit for Liquid is the way social games are distributed to players. When the company made titles for consoles or PCs, it had to find a publisher to distribute the game. As a result, the majority of the revenue from the sale of the game went to the publisher.

Now, Liquid can put a game on Facebook or a cell phone app store without the help of a publisher. Social games are initially free to play, generating revenue from when players make small purchases as they play for items such as an accessory for a character or a boost to help complete a challenge.

Meanwhile, mobile games can be distributed on an iPhone or Android app store for free or for a nominal fee, typically between $1 and $5. The app store then takes a percentage of the revenue, typically about 30 percent.

That means more money for Liquid in the long term, but it could also make it more challenging for a small developer to finance its first few games, said Chris Ulm, a video game veteran who now heads Carlsbad mobile game company Appy Entertainment.

“Being properly capitalized in this marketplace is not easy,” Ulm said. “One of the ongoing challenges is how to grow your business and be clever about keeping your costs contained.”

Liquid is accustomed to making changes. The company shifted from PC games to console titles a few years ago. Del Castillo said it’s all part of diversifying the company so it can survive as the market changes.

“If you looked at the tools we were using to build games 10 years ago and what we use today, it’s just night and day,” he said. “If there’s one thing that’s true about our business, it’s ever changing.”

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