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Freeverse: Answering iPhone's Call to Play

By Jeff Meisner MacNewsWorld ECT News Network
Mar 16, 2009 4:00 AM PT

Mac gaming company Freeverse has come a long way since it first released a version of the "Hearts" card game back in 1994.

Freeverse: Answering iPhone's Call to Play

Now, the 20-employee company is one of the hottest game developers for the iPhone out there.

Based in Brooklyn, N.Y., Freeverse has seven games for the iPhone in all, and its signature app "Flick Sport Fishing" is one of the most popular games at the official App Store.

The company expects to launch a slew of new games for the iPhone over the next 12 months, including one that will license content from an as-yet-undisclosed party, according to Freeverse cofounder Colin Lynch Smith.

"Our first big branded title is coming out in a couple of months," Smith told MacNewsWorld. "We're looking for more high-profile games associated with major brands."

The company's current library of iPhone games includes the following titles: "Slotz Racer," "Days of Thunder," "Flick Sports Bowling," "Big Bang Boardgames," "Sudoku," "Burning Monkey Casino," Burning Monkey Puzzle Lab," "Plank" and "Wingnuts Moto Chaser."

Freeverse's Mac Roots

Freeverse's roots are in Mac gaming, but the company has also developed games for PCs and consoles such as Microsoft's Xbox 360.

"My brother, Ian [Smith] started the company 15 years ago writing a 'Hearts' card game for the Mac," Smith said. "Mac has always been our main focus, and in the last year, that's put us in a good position with the launch of the iPhone. All our engineers and coders are Mac guys, and we were ready to go on day one when Apple launched the app store."

The company brings in between US$5 million and $10 million in revenue, has been profitable since inception and has no debt on the books, he noted. Ian Smith is the majority owner, though Colin Smith also owns a substantial share.

"We've always bootstrapped and never taken any outside investment," he said. "In retrospect, we could have grown a lot faster if we'd had more investment, but we are happy with the decision not to."

Now that the iPhone is hot and Freeverse's apps seemingly just as sizzling, the company has started receiving inquiries from the venture capital community. However, Smith said the company plans to grow on its own.

"We're not interested in going [the venture capital] route," he said.

iPhone Is the Key to Growth

The Mac gaming market has always been a small niche play, but with the advent of the iPhone, the company has grown quickly.

"The iPhone is an order of magnitude bigger than anything else we're doing," Smith said. "With the Mac, we don't do anywhere near the kind of volume we do on the iPhone, and most of the company's resources are going toward the iPhone."

Smith expects Freeverse to grow to about 30 employees within the next year so it can accelerate development of more and better games for the iPhone. However, the company isn't abandoning the Mac or PC markets and intends to throw its lot in with other mobile platforms as well.

"We're also checking out opportunities for games on Facebook and other mobile operating systems like Android," Smith said. "We think Apple has a real competitive advantage, but we're still looking around. The consoles are still hot too, especially the [Nintendo] Wii."

Backing the Right Horse

Though the iPhone is best known as a communications device, its gaming capacity has become extremely popular in the last several months, a trend accelerated with the launch of the iPhone App Store, said Rob Enderle, principal analyst at the Enderle Group.

"I think it's surprised everybody that it's one of the more compelling things driving iPhone sales," Enderle told MacNewsWorld. "Games seem to be driving people to the hardware. I don't know if games are No. 1 yet, but they're trending that way. For a company that has never done games well, Apple suddenly has a very compelling game platform."

Indeed, rivals must be sweating bullets over the increasing momentum behind the iPhone as a portable gaming device.

"As a handheld gaming platform, the iPhone probably scares the hell out of Sony," Enderle said. "The games are nice, they work well on phones, and the thing that's most at risk is something like the PSP (Sony's PlayStation Portable). The Nintendo DS is probably not so much at risk because it addresses a different audience."

Effects of Recession Minimal

Thus far, the economic recession has had little effect on Freeverse's business, according to Smith.

"We're in sort of a micro economy with a good chunk of our revenue coming from the iPhone," Smith said. "Other than the general economic fear that's out there, we've been pretty lucky and insulated from the recession. We're adding staff, not laying people off."

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