Friday, May 22, 2009

Zeebo launches in Brazil--China next? (no)

Looks like the Zeebo has launched, I think in Brazil first. I can't really tell from the report I read whether it has actually appeared on the market though.

Designed for developing markets and regions where latest-gen game systems are too expensive and piracy is rampant, the Zeebo takes a different approach to game distribution--3G networks. Seeing as China has recently launched 3G, it has the potential to be a big thing there.

And why might it succeed? Good marketing research!
[Zeebo CEO John] Rizzo says a consumer’s key requirements are affordability, local language, culturally relevant content, and ease of purchase and play.

“Our focus is frankly not at the top of the pyramid,” says Rizzo. “The richest people in those regions frankly can afford to buy the biggest consoles. We’re aimed solidly at that middle class.”

Publishers’ key requirements, according to Rizzo, are piracy prevention, less expensive title development, low cost, efficient marketing, and access to new markets.

So, how does Zeebo connect the needs of publishers and consumers? Rizzo says it’s by way of the console having zero marketing waste, minimal development cost, nearly no cost of goods due to the download format, and no piracy.

As far as Zeebo's wish to enter the China market, my concerns would be price--$199 is still no small sum of money--how hackable the systems are, and whether China would even allow it in the first place, since consoles are still banned.

As far as piracy concerns, Zeebo says on their website "content providers have a secure channel to market and sell their products. Titles are authorized to work with a unique ID, assigned to each individual console. They are not portable, and cannot be moved between consoles via removable media cards. With no way to copy titles, the Zeebo system is effectively piracy-proof." I'll leave that link they give to read more about it, but they still don't address the issue of potential console modding and people finding ways to access the data off the internal storage device (nor does it say how large that device is, how many games could fit on it before you start having to pick and choose). Of course, it could just be too much trouble to be pirated, as seems to have been the case for the PS3.

Let's say it did get in, though. Could it compete? Online PC gaming in Internet bars is the major form of video game entertainment in China, where gaming is also a more social experience. MMO games are very popular, including WOW, and like in other Asian countries Chinese like doing microtransactions to accessorize their avatars. Zeebo's website, however, doesn't even mention online gaming, which would suck, frankly, if it's not an option--who plays Quake (one of the games available) in single player? Nobody, that's who.

Still, the game list, though extremely short, looks good with big developers like Activision, Capcom, EA, and id giving support, and while most of the games are oldies like Quake/2 Duke Nukem 3D, they are good oldies. Some newer games available are FIFA 09 and RE4. It's really a very short list though, comprising five free titles and twelve more you can buy for $5-15.

Oh that price made realize another problem--you can get a gray market Xbox 360 w/o hard drive for about $200, the PS2 is $99, the Wii is $250 or so, and pirated games are less than a buck a pop--Zeebo will definitely have its work cut out for itself coming to China. If it offers free online gaming, however, it could beat Xbox, which for the most part can't be used in China since it's a fee-based service and Chinese people are stingy, no just kidding, they're just more practical. I can't speak, I bought a PS3 partly so I wouldn't have to pay to play online because I'm a stingy scrooge (The fact that the PS3 is the most expensive console on the market indicates only that I am also a man of great complexity and mystery.)

Plus and minuses aside, I think Zeebo has the right idea, even if the plan for execution leaves some questions unanswered. Prices do need to be lowered for consoles to get into China and other developing markets, but game quality can't suffer. I feel like Zeebo might be wrong about these markets enjoying games that are so many years old when they can easily see what latest-gen systems are capable of any time they're browsing the web. If you're not offering the realism of a PS3 or Xbox360, then at least the find a way to deliver the innovation of a Wii.

(Thanks Karlstadunix and Zeebo!)

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