Au revoir, Vivendi

POSTED BY Global Administrator
And there goes another one.

The news came through earlier this week that Activision Blizzard – the entity formed in July 2008 by the merger between Vivendi Games and Activision – had decided (and  I quote from the letter sent out to its partners) “to discontinue [its] direct presence in the mobile games market”.

 Hardly unexpected - Activision has traditionally eschewed mobile publishing, preferring to licence content to major players such as Glu Mobile – but still an unfortunate day for the mobile games industry: the passing of Vivendi Games Mobile leaves maybe half a dozen tier 1 publishers fighting it out for deck space.

 The industry is already in a fairly fragile state – as we observed in our recent report, mobile games revenues have plateaued in Western Europe and North America, due partly to the fact that there a paucity of fresh, attractive, high-end content on-portal.

This situation is exacerbated when operators continue to demand 50% of revenues for content sold on their decks, making it difficult for publishers and developers (who can spend several hundred thousand dollars on creating a title) to break even.

Hence, those publishers and developers are now falling over themselves to provide games for the App Store – which offers both 70% of revenues and faster remuneration – and in some cases, are exiting Java games altogether because, erm, the games weren’t worth the candle (be seeing you, Sega Mobile).

Whether Western operators can bring themselves to emulate Apple and introduce a revenue-sharing agreement that is more amenable to the publishers is open to question: but unless they do, Vivendi is unlikely to be the last high-profile casualty.

Right then. As a mark of respect, I’m off for a game of Crash Bandicoot Nitro Kart.