Mobile Games, Living Room Entertainment, and a Market That Might Not Exist

How products like OUYA might be catering to a non-existent market.

It all started with a Kickstarter project called OUYA. OUYA had a beautiful design, a low price tag, and promised AAA quality games from indie developers that would make studios money, and fill the largely unaddressed “void” in affordable gaming.

On the surface, this all made sense. Everyone loves playing games on their cell phone. The explosion of tablet gaming had led to a previously unseen quality of game being put on our mobile devices to entertain cell phone owners everywhere. The whole premise to put these games on our TV, for a cheap price, with a controller (!) got everyone excited, but I never quite understood it.

I’ve been playing video games my entire life. I enjoyed the old form of mobile gaming, the Nintendo Gameboy and Eventually graduated to a Sony Playstation, where I have been a moderate user ever since. When the Sony PSP came out, I was intrigued, but after a few hours of using a mobile gaming system that promised console-quality, the experience clearly wasn’t the same. It was at that point that I realized mobile games weren’t meant to be the same experiences as your traditional living room gaming consoles.

When OUYA came around, I think everyone wanted to believe in the technology and platform so much that they forgot the main issue with mobile games, depth. While we have heard about casual gamers rising to prominence, I think the gaming market can be (loosely) compared to the VC fundraising market. Seed round financing has seen massive growth, allowing for young companies to form a team, build a product, and hope to gain some traction, while developing something that will get them to a next round of funding, and eventually to a large, sustainable business (or an exit). Because of this early-stage funding explosion, there were talks about a series A crunch, and now, more is being discussed about the difficulty to raise a series B. Fred Destin puts it best:

Series B is hard for a simple reason: suspension of disbelief fades and is replaced by an increasingly cold, hard look at milestones and progress. Series B is the round where the rubber meets the road, where the promise has to be met with numbers and projections. Series B is the round where hard nosed investors drive ownership up before your company really starts to scale. Series B is the unloved valley of slow progress that precedes scaling. It’s the no-man’s land of the startup build phase.

To relate this back to games, these simple, but entertaining, and wildly popular games could be compared to seed stage (or series A) companies. They have vision, popularity, initial excitement, but aren’t always a complete and polished business. They are lacking total, all-around depth. Regardless of the stage, the overwhelming majority of these games aren’t getting past the point where the “rubber meets the road”. Where they can provide long, repeatable entertainment experiences that one expects when they sit down in front of their 50” HDTV with a controller in hand.

With Amazon launching Fire TV this morning, a set-top box that doubles as a gaming console, I couldn’t help but think: Will Amazon be the ones to crack the non-mobile Android video game console space that people are so positive exists, even though Ouya, with plenty of press and support, is failing? Or is the gaming industry still years away from getting to where the film industry is today? A place where independent no longer means lower quality or less entertaining. Maybe Amazon’s gaming development company will start this revolution, but I think before more companies aim to disrupt the multi-billion dollar gaming industry, they need to fundamentally understand what depth of entertainment people want in their living rooms.