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Interview: Making Plans For Zeebo
Interview: Making Plans For Zeebo Exclusive
May 20, 2009 | By Brandon Sheffield

May 20, 2009 | By Brandon Sheffield
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    8 comments
More: Console/PC, Exclusive



During this year's Game Developers Conference, Brazilian firm Zeebo, Inc. (a firm created by Brazil-headquartered distributor Tectoy and BREW creator Qualcomm) detailed the upcoming full launch of its Zeebo console, a product aimed at the middle class in developing markets where the Big Three consoles are prohibitively expensive.

Players obtain games for the $249 system exclusively through digital distribution, thanks to a built-in 3G wireless connection -- a move intended to sidestep the piracy issues that frequently impact Zeebo's target markets. Each game is expected to run between the equivalent of $5 and $10.

Partly due to the familiarity of its BREW-based system architecture, powered by Qualcomm processors, Zeebo has already lined up a number of ports from established game makers like Electronic Arts (Need for Speed Carbon, FIFA 09), id Software (Quake, Quake II), Capcom (Resident Evil IV), and Sega (Sonic Adventure).

In advance of the system's official Brazilian launch next month, Gamasutra sat down with Zeebo CEO John Rizzo, founder Reynaldo Norman, and Qualcomm games and services senior director Mike Yuen to discuss the system's target market, its plans for original titles, why it's not competing with Xbox 360 or PlayStation 3, and why North America isn't yet in the cards.

There has been no mention of the North American market. Do you have any plans for it yet?

John Rizzo: No immediate plans, certainly not this year or 2010 -- maybe 2011, but nothing in the short term.

There are a couple reasons. Number one, 3G coverage has got to get really pervasive in North America. It's not quite there yet. Number two, more importantly, there is a lot of entrenched competition with existing gamers who are used to Wii and Xbox and PS2 and PS3. As a result, there's already a pretty well-established market here.

So I think we have a chance to be successful in the emerging first-world markets because we're re-applying the ruleset, but it's hard to redefine the ruleset in North America.

Mike Yuen: If you just get into those emerging markets -- Brazil, India, and China of course, but also the rest of Southeast Asia, Eastern Europe, as well as Latin America -- which is what we believe we could do, then we could very well survive there. We don't want to go all over the place.

With the launch titles, there's more of an emphasis on ports than I initially expected. But there's Zeebo Racing, which must be an original Tectoy property. Which direction do you want to go?

Reynaldo Norman: When it comes to most of the audience, they don't know most of the games we are showing. For us, Quake or Tekken 2, well, we played that ten years ago, right? But for most of these guys, they might be playing for the first time. And as we were impressed by these games before, we believe that these guys will be impressed by these games today. It's a different market.

As for the original titles, we can't announce many of them yet, but we are working on good stuff and original titles for Zeebo. It will be both. It will be catalog titles ported from other platforms, and original titles as well. But we need to get closer to the launch of those titles to announce them because there's more involved.

MY: On the traditional console platform, like the PS2, it's not until the tail end that [developers] really master the hardware. So, the first couple years, there may be one or two titles that kind of come down as, "Wow, that's really impressive." But usually it takes a while to get going. We really don't think it will take that long [with Zeebo].

It's not going to be that five years from now, people are really starting to mash with the Zeebo, because it's not a complex development system in the sense of being a Cell processor or anything like that.

We believe we'll see original content, which is key because it's native and it goes faster and it exploits the system, won't be at the tail end of the life cycle. We'll probably see it, like Reynaldo said, coming up later this year.

Is it only Tectoy that's making original stuff right now or other studios as well?

RN: No, other studios.

JR: Some of the titles that are shipping in June are originally-produced content.

It's not as strong as it used to be, but there was a very strong arcade culture in Brazil, so getting something like The King of Fighters series and SNK Playmore's games would be a selling point.

RN: Exactly. On the arcades in Brazil, as you know, most of the titles that are popular today are titles from the 90s. Even Daytona is still very, very popular, and Sega Rally -- the ones from '93, '94, '95. We are working with other publishers, and we are trying to bring the titles that are relevant to each country.

MY: Right now it's primarily a one-time download model; you buy it and own the whole thing. But since it's a BREW-based device as on varieties of phones, there is a variety of billing methods. With the arcade style being popular still, they could get The King of Fighters and put it on there with a token model, pay-per-play. Or if they wanted to move to subscription, they could do that.

I noticed that when you did the live demo at GDC and deleted Quake, it warned that you will have to pay to download again. So you will have to pay to re-download titles?

RN: This is in the manual in the first version in Brazil. Right now, we are rolling up a new UI that will remove this feature. What we want to do in the future, and probably will coincide with our full launch in Brazil, is that if you previously purchased that game -- Quake, as an example -- the server will know that you already purchased it. Then, you just download it again and don't pay anything.

Hasn't the console already soft launched in Brazil?

JR: It was publicly announced to the press, but it was not shipped. The ship schedule was publicly announced in November. The ship schedule was Q2 with limited retail availability, so that's where we are right now. It will go into Rio de Janeiro in June, and then there will be a big roll out. The key date to get ready for is Children's Day, which is October 12th. That's the beginning of the Christmas season. It's a whole massive retail rollout.

Mexico is second for launch. Is that for language reasons or for market reasons? It's easier probably to transition from Portuguese to Spanish.

JR: We want to get Brazil locked and loaded and running, and then switch to Mexico. We're actually in active conversations with partners in Mexico now, we just haven't signed them yet. We'll be ready for the October retail season in Mexico.

MY: We actually were in India a few weeks ago. But with places like India and China, politically and culturally there are lots of pieces. Mexico is a little simpler.

RN: Latin America has the same game culture in general. So, multiple games that we use in Brazil, we can use in Mexico. We can roll them out for them as well. India is more specific -- different content, different approach -- so it will take more time.

India in particular is interesting because it's a slightly unproven game market. How do you figure out what content to release there?

JR: We started ten months ahead of time. We spent a lot of time with the content producers, people in the film and entertainment business. We talked to consumers and started early.

MY: It's not about, "There's EA and Activision, all the gigantic Western catalogs, and we'll just find some way to bring it into another country and spread the word." There's certainly some of that -- cricket, say, if it's India. Maybe FIFA. But the whole goal, like John says, is to go to the right local developers. We don't just have to take everything in the Western world and force it on people in another world.

It seems like the difficulty is that you're not just trying to push specific content. You're also trying to push the idea of a console. Sony has paved the way there to some degree.

MY: But it may not even be a known or called or marketed or positioned as a console, because then you get put in a bucket of video game consoles. So, sure, in Brazil, with the heart of gaming culture, maybe it's more gaming-oriented. But that whole UI can be changed.

When we were there, we found that the educational theme is so strong. All these kids are trying to get into certain colleges, or when they're younger, they're just starting to learn math. So perhaps, it's a fun and learning box.

JR: We had dinner with the head of Qualcomm India who manages thousands of people; he lived in America, was American-educated, wants to buy a PS3. Well, it's not acceptable in India necessarily to buy a pure-play video game console because kids need to be educated. There's a big emphasis on education. The fact that it runs Blu-ray Discs means it's really not a video game console. It's a Blu-ray Disc player.

In our case, with the Zeebo, because it doubles as a wireless 3G modem in the future -- we can upload that software -- if I've got a netbook, I can now surf the internet using Zeebo's modem. Or I can plug it into my TV, plug a keyboard in, and use it as a browsing device. So, it has some utility beyond simply gaming.

We have some customers in India saying, "It could be great if I could allow my kids to learn math or physics or science, and then reward them with Crash Bandicoot for half an hour, or a Bollywood game for half an hour, after they've done all their homework." It's going to be positioned slightly differently in that market.

Another key thing about India is distribution channels. They're not well developed for video game consoles. But they are well developed for other products like televisions, refrigerators, satellite set-top boxes, and so on.

So we're talking to all those key players to see if we can partner from a distributor's perspective, just like we have in Brazil. Because in Brazil, it's the Tectoy Zeebo. It's not the Zeebo Zeebo. And in India, it will be the X Zeebo. In Mexico, it will be the Y Zeebo. It always comes with a brand that's trusted by the local customers.

RN: In other words, in India, it needs to be a console for the whole family, with appeal to everyone that is a decision maker, and everyone in the family.

MY: Which is critical, because in those markets, they have one TV in the home. If they're going to share it, the father or mother might say, "Well, I'm buying it for my kid, and my kid is just playing shooting games. I saved all this money over 18 to 24 months to buy this thing, and he's taking time away from all of us, and all he's doing is playing these violent games."

By positioning it a little differently and offering the right type of content for the whole family to enjoy, whether they play it together or whether it's edutainment, we can do that. Mickey Mouse Teaches Math for the younger kid, something about college for the older one, a Bollywood soap opera trivia thing for the mother, cricket information or whatever for the dad.

Then you create something of value that the whole family sees, and there's not really an issue of, "There's one hour less during the day we're using the TV because there's only one TV in the house."

You said if you reached America, you would have to lower the price point potentially. That means that the perception is that in the lower-income market, you don't have to.

MY: We have this mass market chipset, and our next-generation chipset is getting faster. What we announced, [Qualcomm's] Snapdragon [chipset], is going to netbooks; it bumps it a few notches above that. The cell phone business, including us, is never going to build a processor that's going to match or surpass what the video game guys do. So, why chase that?

When this thing turns on, it's as quiet as unplugged. It doesn't burn any energy. The position if we came into this market wouldn't be, "We're trying to get close to the PS3 and catch them."

It's about a different demographic. Maybe it's a different type of contact. Think of Jakks Pacific, those guys sell millions of those $20 or $24.99 things.

[UPDATE: Price of Zeebo updated on launch specifics.]


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Comments


Leonardo Ferreira
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As a Brazillian, I am very skeptic about this.It is naïve to think that people will be dying to play games that were released ten years ago; the public that they are targeting, the one that has only a mild contact with videogame (not by lack of interest, but by monetary limitation) is a kind of public that is much more impressed by shiny graphics and surprising, new tecnologies (like motion-controlled games) than Quake 2 running at a bad framerate on your TV. For the Zeebo to suceed, it has to at least try to captivate the true gaming entusiast public that already exists in these countries, (with new and creative games, not derivative celll-phone titles and poorly-aged ported games), but thet seems unlikely from a strictly comercial point of view, especially when you consider that Tectoy still sells the Master System console at the equivalent of $90 dollars.

Steve Roger
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Yes, isn't he price point way too high for the quality of games being delivered? Why wouldn't somebody just buy a PS2 and get better games. How much does a PS2 cost in Brazil and Mexico?

Fábio Bernardon
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Prices in Brazil are huge inflated, and a PS2 costs about US$ 250.00 in the black market - I believe they sell it for more than US$ 400.00 in the official market, due to high taxes and high profit margins. Old PS2 games cost about US$50 - 70, while in the US they cost about $20.



I really do not doubt some people may buy it, but most people will not. There is a game market in Brazil, not nearly as huge as in other countries, but people knows the difference between this, the Wii, the PS2, PS3 or the XBOX360. And since all these consoles (except the PS3) can be modded to run pirated games, I doubt people would buy the Zeebo instead of one of the aforementioned consoles.



Companies in Brazil (as well as other emerging markets) should fight for smaller taxes, so there could be more national game developers, instead of trying to create a new console - whose most concearning fact is that it will have a very limited user base.

Maurício Gomes
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Fábio is not aware of the market it seems...



I saw a legal PS2 selling for 200 USD on wallmart... Already beating the crap out of Zeebo price...



And Americanas sell ahem... King of Fighters, for 10 USD (legal)



So, if they plan to sell a crappy console for a huge price, they are mad...



@Fabio again:

Tectoy that lobbied for the increase in the tax of imports, so that they consoles do not get massacred by the lower price of imports, it is OBVIOUS that they will continue selling consoles instead of helping reduce the tax (remember: Tectoy is a ELETRONICS company, not a software company...)





@Steve: Exacly... I think that PS2 will massacre Zeebo, Sony is bringing it legally here, and even its imported price right now is on part to Zeebo, and it "supports" pirated games (something highly prized here, since because of the already mentioned tax law, a imported game is taed 273%, thus a 60 USD game, get launched skyward to 200 USD or more)



@Tectoy: Put again the damn cartridge slot on MegaDrive (they still sell it, but without the slot) and start to make again Sonic 3 cartridges... It is more easy to sell that than sell Zeebo and cellphone Fifa...





The problem with Zeebo is its mistarget... It is neither targeted at the poor population (it has a high-price) neither on the mid-class population (the ones that do not own a console already, want a PS2 or Wii, Zeebo is more expensive than the cellphones that run the same games that it offers, and the cellphones are portable...)



And the 3G network is not THAT good here...

Fábio Bernardon
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@Hélder: you may be right. It has been 8 months since I left Brazil, and since then Sony decided to release the PS2 officially there - so it may have leaded to "lower" prices - but still twice as much as here in the US.



But again, as I said, people that do play games - and is willing to spend some money with it - know that there is the PS3, XBOX 360 and the Wii, and they know which systems can be modded. There is a lot of people I know in Brazil that got an XBOX360 because 1) it is as good as a PS3 and 2) it can be modded. And people that do not have money for a modded XBOX360 will opt for a modded PS2. If a new, official one retails for US$200 legally, then a modded one on the black market must cost around US$150 - 175.



Regarding TecToy, I believe they are not alone... what is the company that did created the Dynavision? Dynacom, right? I believe they are also responsible for the prices being kept high for the more modern systems.



And, at last, I agree with you: the zeebo is being targeted to the wrong audience.

steve roger
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The Zeebo just looks like junk to me. I don't believe that any intelligent person will fall for this. Gamers are smart and they are going to smell this rat from far off.



Second, I doubt that India will buy this thing either.



Third, the $199 price point just seems way, way to high. I was thinking no more than $50 bucks.



Thanks for the information on the PS2. I thought I had read that the PS2 had made it's way into the market much better than the Zeebo claims.

Maurcio Wagner
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How much are Zeebo paying you to be such a "puxa saco"? These guys, as have been pointed out before, are BSing about this console and about the game market in Brazil. Those of us from these "emerging markets" keep showing why this console won't succeed and trying to give real facts, but you guys in the game media don't seem to notice and keep throwing up these PR talking points. Why don't you talk to some Brazilians, Indians, and Chinese?



A PS2 is super cheap in Brazil, cheaper than Zeebo, and so are the pirated games. In fact, Zeebo admitted their mobile ports of old games are more expensive than newer and much better pirated PS2 games. In countries where every $ matters, why would you want to pay R$10 or R$20 for a game you played years ago when you can buy cool PS2 games for R$5? We just don't care about piracy in Brazil. I'm sorry, but it's true. We're used to buying pirated games and it's okay for us. Our mentality is different because our market is different and Zeebo isn't going to change that.



I really had to laugh at Reinaldo (not Reynaldo) Normand saying, "For us, Quake or Tekken 2, well, we played that ten years ago, right? But for most of these guys, they might be playing for the first time." This dude IS Brazilian! If he was playing those games 10 years ago, do you really think he was the only Brazilian playing them? We know what Quake and Tekken 2 are and we know they're OLD. Kids today know what PS3, Wii, an XBox 360 are, and they're not going to be fooled by this.



Could you do a real analysis next time?

Dmitry Maximov
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This console will have a 100% fail in those countries, where GSM operators won't provide unlimited traffic.


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