By Joe Tash
A Rancho Santa Fe businessman is betting that a youthful appetite for downloadable video games, plus a trend of declining sales of video game systems and software, will translate into success for a new, portable gaming device.
T. Scott Edwards, who has worked for such consumer electronics giants as Sony Electronics, Cricket Wireless and Hewlett Packard, launched his company, PlayMG, in July. He and former Cricket colleague Chris Choi are co-owners of the startup, and the two men are part of a founding team of nine people who are running the company.
Their signature product, which is now undergoing final tests, is a portable device called the MG, which has a 4-inch screen and will sell for $169. Users will be able to play pre-loaded games, or download their own games from on the Wi-Fi-equipped device, which runs the Android platform. Many downloadable, digital games are free, while others cost from 99 cents up to $4 or $5, Edwards said.
The advantage of the MG, said Edwards, is that families won’t have to pay $40 or more for cartridge games for game consoles, or $40 per month that is typically charged for a data plan on a smart phone, which can also be used to download and play games.
“Families are finding you can get the same entertainment value for a lot less,” Edwards said.
He said the console video game industry has seen declining sales for eight consecutive quarters, while the number of digital game downloads to mobile devices has exploded to more than 15 billion each month.
Research and development for the new gaming device is being handled by a company in Korea, while the device itself will be manufactured in China, Edwards said.
PlayMG plans to deliver its first devices in early November, and to have its device available for purchase at stores and online in time for the holiday season.
The introduction of such a portable gaming device is definitely timely due to the rising interest in mobile gaming vs. the sales decline for console systems, said Scott Steinberg, head of the business consulting firm Tech Savvy.
The key is whether the device can provide the quality of games that young consumers are looking for, Steinberg said. “If (game) selection is good and the price point is right and they are able to make enough noise,” the MG could prove successful, Steinberg said.
“It’s certainly a rising concept out there,” he said.
Selection should not be a problem, according to Edwards, as the Google’s Play Store contains some 60,000 downloadable games.
PlayMG’s target market is the 52 million people in the United States under the age of 18 who don’t own a smart phone, said Edwards.
Many of those teens use their parents’ smart phones for playing games, leading to frustration on both sides, Edwards said.
The new device promises to end that conflict in an economical way.
The MG will also include software that allows parents to monitor and control both the use of the player and the amount of money spent on downloading games.
One piece of software will send email activity reports to parents, showing what has been downloaded onto to the device, and how long the device has been used. Another — through a partnership with BillMyParents.com — will let parents set up a prepaid account, which can be reloaded, for their children to draw from. Edwards said the system essentially allows parents to provide a “gaming allowance,” which the children can manage by themselves.
Ultimately, he said, the system will include a feature that allows children to earn more credit on their account by doing chores around the house.
PlayMG’s marketing strategy includes the use of social media such as Facebook and YouTube to publicize the new device, through such activities as contests for the best user-created videos.
Gaming enthusiasts can pre-order the device on Kickstarter.com for between $99 and $149.
Edwards said he’s enjoying his first start-up venture because he gets to be involved in so many aspects of the business. On the other hand, PlayMG has far fewer resources than the large companies he has worked for in the past.
“I look behind me and there’s not an army anymore,” he said.
But he does have a band of loyal supporters/advisers — his four children, ages 12 through 17.
“They’ve all been really involved in every element of this,” he said.
For more information, visit kickstarter.com, then search for playmg.