Playing games is a serious business

13 Sep 2002 View Comments
A Computing logo

Digital entertainment is no laughing matter: it's a serious business. Fortunes have been, and are being, made and the foundations of empires laid. As with any serious business, money is also pouring down drains, and disappointment will be the order of the day for many players.

Entertainment through the mobile phone is the nascent business niche getting most attention. The latest part of this to catch the eye after the disappointment of Wap is entertainment on the J2ME phones.

These phones will be in the hands of users in their tens of thousands, if not millions, by Christmas this year.

Network vendors of all types want to boost their traffic, and entertainment is clearly a key way to do it. Mobile network vendors see games as part of the next boost to revenues following the success of SMS.

It's all about entertainment. And within entertainment there is no hotter sector than games. The place to start, therefore, is with the games developers.

You cannot get smaller than Covert Operations, working away on Java-based games for the small screen of the mobile phone. The company name is a good ice breaker when its founder Niall Fraser goes to shows or talks to the likes of BT.

'What exactly do you do ...' enquirers ask hesitantly as they look at his badge or view his website. The joke is taken further at Covert's website, with links to the kids sections of the FBI, CIA and NSA sites.

The next step in the chain for the games developers is the increasingly important role of the games service providers, or 'aggregators' as nGame likes to call them.

Aggregators collect portfolios of games into packages to sell on to the network providers. That's the strategy forged by nGame in October 2001, which led to a deal with T-Mobile.

One good point about the UK's contribution to the development of digital entertainment provided by these companies is their geographic spread.

It is all reminiscent of the early microcomputer business in which the UK played such a central role, and early experiences of UK micros were often formative in the history of our two companies.


We have to thank Sir Clive 'Uncle' Sinclair for the existence of Covert Operations, the games development company.

Typing five pages of hexadecimal code from a games magazine into a Sinclair ZX81 and finding it will not run because of a few typing errors is a good lesson for any future programmer. Tight code and precise programming is also required in the confined space of the mobile phone 20 years on.

Niall Fraser, founder of Covert, got one of the first ZX81s in kit form in 1981 as a pre-teen in Scotland. Today the power and memory of the mobile phone, with 128K of memory, must seem a luxury compared with the 1K in the original ZX81 model.

Fraser turned his interest in programming into a profession, spending eight years at Marconi developing military products, including flight simulators. Then came games production at a games house and, eventually, his own company in October 2000.

He cleared his kitchen table and started with a project to take Denki Blocks! onto the Gameboy Color platform under a contract from Denki, which had its hands full at the time.

He soon learned that the console games market was toughening up. The console players control the manufacture of the cartridges and want a hefty cut of the price of any game.

To ensure this type of income, games publishers increasingly focused on what they thought were sure bets. This pressure, in turn, forced them to only look seriously at tie-ins where they licensed the right to use cartoon, film, toys or famous characters. "It was very difficult to get new ideas listened to," said Fraser.

This was despite some financial support from Scottish Enterprise that allowed Fraser to attend the big annual games jamboree E3 in the US.

It was then that the mobile phone games market started to open up. Here the technical restrictions of small memory and tiny screens made innovation the key. While Wap proved a failure compared with the aspirations of its promoters, the real success came with SMS-based text-style games.

One of his early SMS games was a dating game which generated 60,000 messages in its first two days. That was good news for generating extra traffic for the mobile services vendor which offered it; good news for the company providing the games service to the mobile operator; and good news for Covert.

Covert works for the games service providers, or aggregators, such as Digital Bridges, and Fraser uses contract programmers to work on the development of the contracts he wins.

Scotland has a lively games community, but in Dundee and Glasgow, not so much in Edinburgh, where Fraser was based. The lure of London proved too much and he shifted his base in March 2002.

He has funded development himself and awaits more success before expanding into direct employment. He is cautious because several games development studios have gone under recently because they employed people too early, he said.

The projects for mobile games development are short: one to two months. Games service providers are always on the lookout for innovative games with which to lure their customers, the mobile phone service vendors such as Vodafone and T-Mobile.

The market is increasingly looking for royalty-based deals rather than up-front fees, explained Fraser, who wants a mixture of royalties and fees so that the cash keeps rolling in.

But royalty-based deals will leave him with the intellectual property so that he could take the games to other platforms. Java is the language of choice and Java-enabled phones are dribbling onto the market.

The simplistic nature of mobile phone games, compared with the rich environment of console games, means the games rely more on the experience of playing them rather than the surrounding media. Console games now have such rich sound and vision that the game playing becomes less important.

One of Fraser's first projects for the Java mobile phone market will be a sideways scrolling game in which the player controls a character with a sword on a black and white screen.

Now 32, he must think he's turned full circle, and is back in his bedroom as a 12 year-old with his own black-and-white TV bashing hex into a ZX81.


The first computer game Dave Lloyd sold was a golf game. The chief technical officer at nGame developed it and sold it for £50 while still at school.

Now he and nGame co-founder and chief executive John Brimacombe have move up from the school playground and are selling games to adults; serious adults who will pay a lot for the right games.

They are trying to collect portfolios of Java-based games to sell them on to the mobile phone network companies. They call this emerging role a "market maker; an aggregator".

There are three parts to the aggregator role: sourcing the content from games developers; running the storage server for the carrier; and hosting the software platform for the games.

Ngames' first big contract as an aggregator, signed in May, was with T-Mobile. The company will supply 120 Java games for T-Mobile to boost the use of its networks in Austria, Germany and the UK for two years.

T-Mobile will use nGames' Wotan software platforms to run the games for UK customers delivered through the One-2-One network T-Mobile bought in 2001.

This aggregate role is a change of course for the five year-old nGame. For the first four years it focused on games development, building a portfolio of more than 20 "entertainments" outside the Java arena for digital interactive TV, Wap and SMS.

nGames' highest achievement was a multi-player Wap game simulating medieval trading called Merchant Princes. It also dabbled in the interactive TV game market with a deal involving troubled cable company NTL.

But today the focus is on the new strategy for mobile game aggregation introduced in October last year. The competition comes from the likes of Digital Bridges, a Scotland-based company heavily into SMS games.

This mixture of business from its games development and the aggregation strategy won nGame an unaudited turnover of about £400,000 in the 12 months to June 2002.

Brimacombe projects a turnover in its current financial year of £1.9m. Profits should flow in the first quarter of 2003.

He will not say how much cash the firm is burning in keeping its 23 people focused on the target and supporting offices in Cambridge and San Francisco.

So far nGame has raised £4m in debt and equity. Some early capital came from Brimacombe's father, a former PwC partner. Later investments came from and through Roger Graham, whose achievements in the UK IT industry are as long as your arm.

They include board membership or chairmanship of the Delphi Group, Gresham Computing and Braid Systems, as well as leading BIS Systems. He is also past president of the CSSA.

Graham is part of the Cambridge connection. He graduated in engineering in the late 1960s before a career that saw him pass through, among others, IBM.

Brimacombe read law at Cambridge, while Lloyd graduated in physics at the same university. Both maintain that Cambridge encourages a pragmatic attitude. "There is a 'we can get things done' mentality," explained Brimacombe.

Lloyd's previous venture was Oxford & Cambridge Compilers. It developed Fortran and other compilers for scientific and engineering applications for the likes of the Jet Propulsion Laboratory and other academic institutions. He often used games to test his compilers.

This experience of compiler writing came in useful in the early days of nGame, when Lloyd developed a scripting language and a content server on which to run the games.

"This allowed us to produce the game Merchant Princes in a fraction of the time that the competition would have taken and make it more complex than other games," he said.

Brimacombe's entrepreneurial expertise includes founding a software company in offshore trust applications. If both men make their fortunes, they may generate some lucrative business for some old customers.

Reader comments
blog comments powered by Disqus
Windows 10 - will you upgrade?

Microsoft has made an early version of Windows 10 - its next operating system - available for download. The OS promises better integration and harmonisation across platforms, including mobile and desktop. Will your business be upgrading?

38 %
26 %
15 %
21 %