Pluggedin: Apple's iPhone emerges as gaming platform

By Gabriel Madway

SAN FRANCISCO, April 1 (Reuters) - Apple Inc's (AAPL.O) iPhone has emerged as a serious video game platform, fulfilling the long-held promise of mobile phone gaming and positioning itself as a legitimate competitor to handheld consoles.

The Game Developers Conference in San Francisco last week was abuzz with plans about games for the iPhone and its WiFi-only cousin, the iPod touch.

With around 30 million devices on the market -- 17 million iPhones and 13 million iPod Touches -- and access to thousands of games at their slightest whim, consumers are buying and playing games by the tens of millions.

Meanwhile, game designers are diving headlong into the market, churning out offerings at a furious pace.

Some say the iPhone's unique features -- GPS capability, connectivity, a touch screen -- and sheer variety of content gives it an edge over its more established handheld console competition, Nintendo's DS and Sony's PSP.

The DS franchise has shipped more than 100 million units and the PSP more than 50 million since both came to market in late 2004.

"The iPhone is a threat to other portable game platforms," said Mitch Lasky, a partner with venture capital firm Benchmark Capital, and the former CEO of Jamdat Mobile, which was sold to Electronic Arts in 2005 for $680 million. "It could be just massive."

Apple's App Store went live only last July, but an entire network of developers has sprung up to create thousands of games, ranging from puzzles and arcade games to action and shooter games. Developers take 70 percent of the revenue, while Apple keeps 30 percent.