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Batman Arkham City on the iPad shows how tablets can rival traditional game consoles.

Guest Commentary: The video game industry is changing like never before. Here are my best attempts at peering into the crystal ball for 2012:

Matt Hulett

Prediction #1:  Tablets are the new game consoles

Tablets and smartphones are already becoming the mass market console gaming platform of choice.  I personally play more core games on my iPad than I do on my console.  I played a lot of the Batman Arkham City Lockdown game and was blown away at the graphics and fun multi-touch gameplay.  The new generation of kids will largely skip consoles as their go-to video game consumer experience and head right towards Android and iOS devices.  In the traditional gaming space, look for continued declines in the category of revenue and shipments.

Prediction #2:  Amazon builds The Game Cloud

Amazon’s EC2 and cloud services already power much of the social gaming industry.  Their Kindle Fire is already looking like the #2 player behind Apple in the tablet space.  Along with being the largest e-commerce player in the world, why not connect the dots with a cloud-based gaming service that provides open APIs for game developers to hook into their stack as well as streaming services? You can imagine an expanded notion of what Amazon has done with their Kindle app — making it cross platform and dabbling in HTML 5. Imagine building your game once and hooking into services like distributed entitlements, game state support, etc? For example, if players are on the bus using their Kindle Fire, they can save their gameplay and then pick up where they left off at work via Facebook on their laptop.

Prediction #3:  Casual is back on the social graph

We already saw genre diversification for social games between 2010 and 2011.  Now about half of the social games are casual versus Ville’s.  Look for new types of takes on the traditional game mechanics to explode onto the social gaming scene in 2012.  One can merely point to the Hidden Object Games, Gardens of Time or King.com’s Bubble Witch Saga, as successful recent examples.

Prediction #4:  New entrants in mobile and social

Yes, there is much more competition in mobile and social. But, we have seen examples of relatively new companies rocketing to the top of the most popular application charts.  Recent examples are the meteoric rise of Wooga and the recent success of King.com that have both made the Facebook Top Ten Game List as measured by daily active users.

Prediction #5:  More market consolidation

There will be increasing social and mobile gaming consolidation.  Recent gaming IPOs such as Zynga and Nexon have raised billions of dollars so they’ve got money to spend.  Existing players like Disney and Electronic Arts have already made huge plays as well.  Look for continued acquisitions by both new and established players as they look to expand market share in the white hot social and mobile gaming spaces.  There will be at least two $500M+ acquisitions in 2012.

Here’s to an exciting 2012!

Matt Hulett is the chief gamer of GameHouse, the games division of RealNetworks. He is a serial entrepreneur who has successfully built profitable companies from scratch and has a proven track record of growing businesses throughout a variety of stages, including startups and turnarounds from travel, e-commerce, advertising, and gaming sectors.
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