EA's Spore aims to create new worlds, businesses

RALEIGH, North Carolina (Reuters) - Electronic Arts Inc's creature-building game "Spore" offers players a chance to develop new worlds -- and maybe even new lines of business for the video game maker.

The new game, which lets players guide the evolution of their creatures, is from Will Wright, the man behind the Sims series of games. The Sims let players guide virtual people and cities, spawning spin-offs, sequels and expansion packs to the tune of more than 100 million units sold worldwide.

Billy Pidgeon, video game analyst for IDC, believes "Spore" is a going to be huge globally, eventually eclipsing the Sims.

"This title has billion-dollar potential," he said. He expects spin-off games and a host of fan-oriented websites and products, such as custom T-shirts of players' creatures, that should boost the value of the game.

Already players trying out early releases are sharing their creatures, adding complexity to the game at no expense to EA.

Gamers have been waiting five years to get their hands on "Spore," which will finally launch in North America on September 7, and EA has spent $50 million to develop it, estimated Michael Pachter, video game analyst for Wedbush Morgan Securities.

Pachter estimates EA will ship 3 million copies of "Spore" at $120 million wholesale, and expects it to sell through 2 million this year. With a break-even point of 1.7 million units, EA should be well on its way to a strong new franchise.

"Economically, it's not that big of a deal this year, since it cost so much to make, but they made a big bet that this game would pay dividends for years, so they care a lot," he said.

REAL CASH FROM VIRTUAL WORLD

EA CEO John Riccitiello said at a Citigroup conference in New York that the "microtransaction potential for 'Spore' is huge," referring to selling gamers new virtual creature parts, vehicles and even planets online for real cash.

Creator Wright calls Spore the world's first "massively single-player" experience because every new "Spore" creation can be uploaded to EA databanks and then used to populate other players' game worlds. Wright said one of the next challenges is how EA can we make the most of gamers' creations.

EA gave a taste of the game with the June 17 release of "Spore Creature Creator," a $10 mini-game that has led to the building of 3.3 million creations uploaded to Spore.com.

Of course evolution could hit a dead end.

"Obviously, gamers that waited this long for 'Spore' will probably love every second of it," said Chris Buffa, senior editor at AOL GameDaily. "These are the people that'll spend hours creating monsters and plundering space.

"That said, few games that take this long to make live up to the hype, and there's a possibility that what these people think 'Spore' should be, based on all the hype, will fall way short of the final product."

EA is offering an assortment of "Spore" choices, aiming for the largest audience possible. As well as the standard $50 PC game, "Spore Galactic Edition" ($80) comes with a poster, two documentaries on the game, a 128-page hardback book on the art of the game, a collectible case and a Galactic Handbook.

EA will tap the many users of Nintendo Co's DS with "Spore Creatures" ($30), designed for the portable. Rounding out the launch options is "Spore Origins" for mobile devices, allowing for short spurts of creativity on-the-go. Console versions of Spore are expected in the future.

"Casual gamers will likely play 'Spore' in short bursts," Buffa said. "It's always a matter of whether they'll 'get it,' since they're used to more digestible games that aren't as deep. As for the Sims fans, this is the next evolutionary step for Sim games."

Spore has shipped in Australia, Germany, France, Belgium, the Netherlands, Luxembourg, Switzerland, Austria, Finland and expands to the rest of Europe and South America on September 5.

High-resolution satellite launched in California

VANDENBERG AIR FORCE BASE, Calif. - A super-sharp Earth-imaging satellite that can detail an area the size of a baseball diamond's home plate from space has been launched into orbit from Vandenberg Air Force Base on the Central California coast.

A Delta 2 rocket carrying the GeoEye-1 satellite lifted off at 11:50 a.m. Saturday. Video on the GeoEye Web site showed the satellite separating from the rocket moments later on its way to an eventual polar orbit.

Arizona-based General Dynamics Advanced Information Systems, the satellite makers, say GeoEye-1 cost more than $500 million to build and launch.

The satellite will orbit 423 miles up and circle the Earth more than a dozen times a day. In a single day, it can collect color images of an area the size of New Mexico, or a black-and-white image the size of Texas.

In black-and-white mode, the satellite can distinguish objects on the Earth's surface as small as 16 inches, GeoEye Inc. said.

The company says the satellite's imaging services will be sold for uses that could range from environmental mapping to agriculture and defense.

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On the Net:

GeoEye: http://launch.geoeye.com/

Microsoft Slashes Prices of Xbox 360 Models

There is something for everyone, according to Microsoft officials who are touting the company's new prices for all three models of its video game console, the Xbox 360.

On Wednesday, U.S. consumers saw the Xbox 360 Arcade base model drop from $279 to $199 just a day after the software giant cut prices by 30 percent for the Xbox in Japan. And beginning on Friday, prices for additional Xbox models will drop. The 60GB Xbox Pro model will drop from $349 to $299, and the 120GB Xbox Elite will have a new $399 price tag compared to its old price of $449.

Microsoft also said that beginning this fall, the Xbox 360 would be the only console offering instant streaming of 12,000 films and television shows from Netflix. In order to view those films and shows, consumers need an Xbox Live Gold membership and need to have an unlimited Netflix subscription plan. Analysts say this kind of innovation may thrust Xbox ahead of its game-console competitors, Nintendo and Sony.

Historic Indicators

The move to offer the Xbox 360 for less than $200 is spurred by increased competition from Sony's PlayStation and Nintendo's Wii both in the United States and across the globe.

Microsoft, however, said it is just following historic indicators. History shows that more than 75 percent of all console sales occur after the price falls below the $200 mark, according to Don Mattrick, senior vice president of Microsoft's interactive entertainment business. "The majority of consumers make the decision to buy consoles once the price falls to this mark, making this an important milestone for consumers in the industry," Mattrick said.

Nintendo's Wii, in comparison, is priced at $249, while Sony's 80GB PlayStation 3 is $399.

Taking the Lead

Electronic Arts, a publisher of interactive games and software, came out last December with its predictions of who would be on top this year, and as of today, its crystal ball was right.

Electronic Arts predicted that the Nintendo Wii would sell between 5.5 million to 6.5 million units in North America and an additional 6.5 to 7.5 million units in Europe by the end of the year.

EA's prediction was correct. As of July 1, Nintendo sold 10.9 million units in the United States alone, according to the NPD group. Nintendo sold 18.1 million Wii units worldwide in the company's fiscal year between April 2007 and March 2008, and 24.5 million units worldwide since 2006.

Sony's PlayStation 3 was the second favorite, with estimates of between 9.5 million and 11.5 million units to be sold both in the United States and Europe by the end of the year.

Sony, however, has sold more than 12.85 million PlayStation 3 units worldwide since its 2006 debut, the company said in its results for the 2007 fiscal year, which ended on March 31, 2008.

The Xbox was in last place in EA's predictions, expected to sell between six and eight million units in the United States this year.

Microsoft, however, said it has sold 11 million Xbox units in the United States since its debut in 2005, and 19 million worldwide, beating out Sony for second place.

App Stores: Microsoft, Google Follow Apple

When Apple opened its iTunes App Store in July, the idea of a mass-market Web site that sells downloadable games, tools, and other applications for cell phones was a rarity. Handset owners could buy apps from their carriers or the occasional niche site. But these days, the app store concept is becoming commonplace. The question is, does the world need a warren of wireless app stores?

In the coming six months, at least four would-be rivals of Apple will probably open their own online bazaars where developers of all stripes will sell downloadable software applications to make cell phones more fun and useful. Google has already announced its plans, while Microsoft, Symbian, and T-Mobile USA are in the likely-to camp.

The appeal of an app store is undeniable. Since the App Store debut, users of Apple's iPhone and iPod Touch have downloaded more than 60 million applications, sampling the more than 3,000 games, calendars, and fitness applications on offer for as much as $10 a pop, though some are available at no charge. Sales averaged $1 million a day in the first month.

Microsoft's Skymarket Is Coming

Microsoft and other owners of competing operating systems want to ensure Apple's popularity doesn't take a toll on their own market share. "People are chasing the iPhone," says Van Baker, an analyst at consultancy Gartner. Microsoft's plans to launch a store were laid bare by job descriptions posted Sept. 2 on job board computerjobs.com. The mobile applications marketplace, to be called Skymarket, may launch in tandem with the next version of Microsoft's cell-phone software, Windows Mobile 7, expected in 2009.

While he wouldn't confirm or deny plans for Skymarket, Scott Rockfeld, group product manager for Microsoft's mobile communications business, says the company ultimately wants to provide a resource, akin to CBS's CNET, which includes reviews and customer feedback on products. "They are the trusted adviser to their community," Rockfeld says, though he declines to comment on plans to sell applications other than to say, "We are always innovating on Windows Mobile. "The job postings have since been removed. Currently, Microsoft operates Windows Mobile App Catalog and Total Access, which aggregate applications and direct users to third-party sites to make purchases.

On Aug. 28, Google said it will open Android Marketplace, which will offer third-party applications for mobile phones running on a new operating system, called Android, built by a Google-led industry group. Done right, the new stores could create competition for Apple, Baker says. "They could significantly impact the iPhone," Baker says. "If you have an equivalent of iTunes App Store available on multiple handsets, consumers will have more choice. And competition tends to spread the market."

"Wild West Days"

Apple's interest in applications stems from more than just the 30 percent cut of every sale. The software is also a complement to sales of more expensive, higher-margin hardware. J. Gold Associates analyst Jack Gold figures that the App Store has helped Apple sell 10 percent to 15 percent more iPhone 3Gs than the company would have sold otherwise.

Existing retailers such as Handango could suffer as well. Anticipating additional competition, the company is already revamping its site. Due to be launched later this year, the new storefront tracks users' recent searches and purchases and recommends additional software from its portfolio of some 200,000 applications. Handango CEO Bill Stone says the new stores will expand the larger market. "With the market growing so fast, there's plenty of room to operate," he says. Additional stores "can crack the code on awareness."

Still, aping the iTunes App Store won't be easy. "It's all Wild West days compared to the iTunes store," says Richard Doherty, director with consultancy Envisioneering Group. Each new market entrant faces its own, unique challenges in rolling out a store. And there's danger that some of the new stores won't live up to expectations. "There's almost as much downside to this if it's done poorly as an upside," Doherty says.

Google's Open-Door Policy

Take Microsoft, whose Windows Mobile software resides on millions of smartphones. Older Windows Mobile phones may not be upgradable to Windows Mobile 7 and may not be able to take advantage of the new Skymarket store. Other devices may not contain enough built-in memory for their users to download multiple applications.

Google's Android Marketplace faces a different set of challenges. Google will let developers post applications to the store in a matter of minutes, without going through an approval process. "A model like [Google's] really allows people to experiment," says Android developer Jeffrey Sharkey.

But that will make it hard to vet bad, glitchy, or inappropriate applications. To weed out bad apples, the Marketplace "features a feedback and rating system similar to YouTube," according to the official Android developer blog. But users could still unwittingly download software containing viruses or malicious code damaging a phone, or simply buggy applications. Apple takes weeks to vet applications posted to its store, and rejects many.

Programmers Hedging Their Bets

How soon the Android Marketplace will support paid applications is unclear as well. When the first Android phone come out this fall, "at a minimum you can expect support for free [unpaid] applications," according to the official blog. "Soon after launch an update will be provided that supports download of paid content and more features."

T-Mobile USA, owned by Deutsche Telekom, appears to be feverishly revving up its own marketplaces, according to people close to T-Mobile. The carrier's new site for third-party developers states that "in the coming weeks, T-Mobile will be offering new ways to go to market." Unlike Apple, which sells applications for a single brand of handsets. T-Mobile faces the daunting task of offering applications that work with many different handsets, says Moe Tanabian, senior principal at IBB Consulting. T-Mobile declined to comment.

Unsure about how the stores will work, and which of these efforts take off and when, many programmers are hedging their bets, working Ion apps for a variety of operating systems. Microsoft's Professional Developers Conference, scheduled for October, has been the fastest-selling developer conference in history, according to Rockfeld. Interest in Android is surging. One blog for Android developers, AndroidGuys.com, has seen its traffic rise fivefold, to 10,000 visits a day, from June to August. "Proliferation of these stores can be a benefit for the developers," says Dan Gilmartin, vice-president of marketing at uLocate, which is working on applications for most of these efforts. "We are seeing growth in demand for applications across the board."

Nokia warns 3Q market share will fall; shares dive


HELSINKI, Finland - Shares in Nokia Corp. tumbled Friday after the leading cell phone maker said its third-quarter global market share will decline from second-quarter levels because of aggressive price cuts by its rivals.

AFP/File Photo: Nokia's Research Center in Helsinki, pictured in 2007. Nokia, the world's leading mobile phone maker...

In July the company, the world's top mobile phone maker, had predicted that its market share would about the same in the two quarters — about 40 percent.

Nokia said it was losing share because of its "tactical decision" not to match the aggressive price cuts of some of its competitors, seeking instead to be "sustainably profitable in the longer term." It also cited tough competition in emerging markets and a slow "ramp-up of a mid-range Nokia device."

Nokia's shares fell 9.5 percent in trading in Helsinki, and its U.S. shares slid $1.69, 7.6 percent, at $20.62.

Nokia was upbeat about the rest of 2008, saying it still aimed to increase its market share for the year. It already sells more phones than its three main rivals combined.

But the company's share price has plunged about 40 percent this year amid concerns the mobile industry would suffer as the credit crunch and inflation take a toll on economic growth and consumers' spending power.

Also, the closely watched average selling price of Nokia handsets has continued to fall, because of higher volumes of cheaper phones sold in emerging markets and a negative impact of the weak dollar.

In the second quarter, the average price for a Nokia phone was 74 euros ($107), down from 79 euros in the first quarter of the year and 90 euros in the second quarter of 2007.

Nokia is due to report its third quarter results Oct. 16.

Going, going gone: JetBlue auctions flights on Web

NEW YORK - JetBlue Airways Corp. is auctioning off more than 300 roundtrip flights and six vacation packages this week on eBay, with opening bids set between 5 and 10 cents.

The flights are to more than 20 destinations, including four "mystery" JetBlue Getaways Vacation packages to undisclosed locations.

The three-, five- and seven-day auctions include one- and two-person roundtrip, weekend flights in September from cities including Boston, Chicago, New York, Orlando, Salt Lake City, Fort Lauderdale and Southern California.

Harlan Platt, a finance professor at Northeastern University who follows the airline industry, thinks the auctions will provide some valuable "word-of-mouth" advertising for the discount carrier .

AP Photo: Travelers use ticket kiosks at JetBlue Airways' new Terminal 5 at John F. Kennedy International...

"I think it's a great idea. In this day and age, people are inundated with ads as they are sitting on airplanes, or at airports," he said. "A subtle advertisement such as this could be very effective."

Platt said the auctions will likely produce final bids between 85 percent and 90 percent of the flight or package's total value.

"It's all about the cost of getting someone to notice you," he said. "And this (method) provides a lot of bang for the buck."

Each auction will have a specific range of dates in which customers can travel. The travel dates, times and flight numbers will be posted when the customers bid.

The vacation packages include airfare and a four-night hotel stay for two at Marriott hotels in locations including Las Vegas and Nassau, Bahamas. The four mystery packages include two locations where passports are needed and two that don't require passports.

Taxes and fees are additional and will vary according to the particular route, but they will be disclosed in each listing, according to JetBlue spokeswoman Alison Eshelman. Bidders will need to have a PayPal account.

Flights leave on Thursdays or Fridays and return on Sundays or Mondays. All travel must be completed by October 6.

Customers can access the auctions through http://www.jetblue.com/ebay.

Yahoo search services arrive on AT&T mobile phones


SAN FRANCISCO (Reuters) - AT&T Inc is set to begin featuring Yahoo Inc search services on the Internet menu of mobile handsets used by its base of up to 70 million U.S. customers, the companies said on Monday.

AT&T plans to offer, through its mobile Internet portal, a collection of Yahoo's oneSearch mobile Web services including links to news, financial information, weather, Flickr photos as well as Web search via the phone.

This is part of a revised partnership announced in January between the two companies where Yahoo will provide search and advertising services to AT&T's broadband computer, Internet TV and mobile phone customers. AT&T's YellowPages.com will deliver local search information to customers as part of the new deal. . .

That replaced a 2001 broadband agreement where Yahoo split revenue with AT&T when customers signed-up for broadband computer Internet services in the U.S. phone company's service area.

Separately, Yahoo reached a contract extension with Verizon Communications Inc on a similar broadband computer deal to deliver Web services to Verizon computer broadband and Internet TV users. That deal does not cover mobile phones.

Rival Google Inc is in talks with Verizon to become the preferred Web search provider for Verizon mobile phone customers. Verizon, the No. 2 U.S. mobile operator, is set to overtake market leader AT&T once it wins regulatory approval to buy rural wireless provider Alltel later in 2008.

Yahoo said it has announced partnerships with 60 carriers worldwide to offer OneSearch services on mobile phone networks serving close to around 800 million subscribers.

These deals stretch across Asia, Europe and Latin America. With AT&T now live, two-thirds of the announced deals have been put into effect. OneSearch is seeing heaviest usage from two Philippine carriers, Smart and Globe, a Yahoo spokesman said.

Search queries are also strong in Britain and across Europe through carriers deals with T-Mobile, France Telecom's Orange and Telefonica SA's 02.

"This partnership with AT&T will enable Yahoo to reach tens of millions of mobile Internet users in the United States and provide advertisers with reach and scale," IDC wireless analyst Scott Ellison said in a statement from Yahoo.