Infinium Labs may once and for all put jokes about its phantom products to rest. On Monday the company said its Phantom Gaming Service will go on sale Nov. 18, two years after the Florida company began touting the system.
Between now and then, the company will build and test its hardware, line up partnerships for game software and conduct live tests. Infinium will preview the service at this week's E3 video-game conference in Los Angeles.
The Phantom Gaming Service starts with a specialized PC in the form of a set-top box attached to a broadband connection. The device taps into a library of PC video games that customers can buy or rent. Customers can get the hardware free if they sign up for a two-year subscription at $30 a month, or they can get the device for $200 without the commitment. A basic subscription will give access to relatively older games, while premium plans will provide access to the latest first-tier titles.
"It's not so much about the hardware, it's more about access to a broad library of content," said Kevin Bachus, president and chief operating officer. It's much like XM Radio, where the emphasis is on the programming, not the radio itself, he said.
Bachus was one of the chief creators of Microsoft's popular Xbox video-game console. He joined Infinium in December and brought a raft of other Microsofties with him, including Ty Graham, who ran the development of the DirectX video-game software technology. With Bachus' arrival, Infinium went from an outfit with a dubious business plan to a company to watch.
Inifinium initially wanted to build a video-game console, based on the guts of a PC, to take on the Sony PlayStation, Microsoft Xbox and Nintendo GameCube. But Bachus repositioned the company to focus on selling a service, which "is a lot more sensible," said Billy Pidgeon, senior analyst at market research firm The Zelos Group.
"With their past positioning as a console, their chances were nil," Pidgeon said. "The hard-core gamers already have PCs, and it wouldn't leapfrog any existing console." With conservative business goals, "their chances of success are fair to good."
Bachus said he won't try to go after hard-core gamers. Instead, he will target the service at occasional game buyers and "lapsed" gamers – older people with careers and families who like to play but don't have the time to hang out at the video-game store in the mall.
He said he's also confident that he can build a large library of content, which is crucial to the success of the service.
Unlike movie studios that can turn a box-office flop into a moneymaker through DVD sales and TV rights, "game publishers have one shot, usually in less than 90 days, to get their money back," Bachus said. "If they miss, they have to reduce the price of their games for the bargain bin or buy the inventory back." The Phantom Gaming Service would give game publishers – which now spend $5 million to $10 million to develop and market a game – another chance to make money.
Phantom faces competition from existing services like Yahoo Games on Demand, which lets anyone with a regular PC download and rent games. But Bachus still has a lot of clout in the industry, which could translate into a larger library for the Phantom service, Pidgeon said.
