Are cheap iPhone games killing the handheld gaming industry?

In last week’s news roundup I linked a story about how the founder of n-Space, Dan O’Leary, blamed low sales on the iPhone and iPod touch.  It seems his Nintendo DS development company is experiencing some rough times and he needs to find a scapegoat. I would like to take a closer look at the article and share my opinion.

“Huge budget titles have to sell massive numbers to return a profit and the App Store has disrupted our industry in the same way iTunes changed consumer expectations for music.”

First, whose fault is that? I don’t think that titles with a large budget requiring tons of sales to make a profit is the fault of the App Store. Perhaps you should try doing a little market research and give your customers games what they want.  Consumers don’t care how much money you spend creating a game if it sucks.

“People that use to buy many games every year now buy a few AAA titles, supplementing their need with games that are free or cost less than a pack of gum.”

You know why that is Dan? Because game developers are coming out with sub par games and expecting consumers to buy them just because. It is awesome that the games look so realistic but if they are no fun what is the point? I would much rather take a chance on a 99 cent game because I won’t be out much, unlike a DS game where I will have to pend in excess of $30 only to find out it is terrible and Gamestop will buy it back from me for a third of what I paid.

Interestingly, O’Leary revealed development of an iPhone and iPod touch game at n-Space that will be announced next week.

Now you are headed in the right direction. To be successful in tough economic times you have to be willing to make some changes. Many companies have shown that you can develop a great game and find great success in the App Store while laughing all the way to the bank.