Sony's online card trick
The entertainment giant teams up with Topps to launch the first trading card game to debut on the Internet and then appear in stores.
NEW YORK (Fortune) -- Most adults still think you have to go to Target for a deck of trading cards if you want to play a hit game like "Magic: The Gathering." Their kids know better.
Like most other genres of entertainment, trading card games are moving online. In recent years, card makers like Wizards of the Coast, Magic's owner, have launched virtual versions of their physical franchises.
But here's another sign of how the Internet is reconfiguring the trading card business: Sony (SNE) Online Entertainment is announcing on Tuesday that it has created what it describes as the first game that will debut on the Web and then migrate to the shelves of Target (TGT, Fortune 500) and Wal-Mart. (WMT, Fortune 500)
Sony has struck a deal with Topps to allow the baseball card and candy manufacturer to make a physical card line based on its virtual trading card game created for Free Realms, a Sony "massively multiplayer online role-playing game," or MMORPG, now in beta. The Free Realms digital card game officially launches in January. Topps unveils its physical version later in the spring.
"You'll be able to play it online," said John Smedley, president of Sony Online Entertainment. "Then we are adding a retail component. This is the first time you are going see a game launched this way. It shows how times are changing in this industry."
Both Sony and Topps executives say the physical Free Realms card game will complement its digital sibling. Fans who purchase the Topps cards will find a "loot" card in every pack that can be redeemed in the Free Realms fantasy world for prizes like pets, clothing, race card upgrades, wands, household items and special powers.
The same is true for players who purchase digital decks online. But players who buy the Topps Free Realms cards are entitled to exclusive virtual merchandise -and digital playing cards that can only be acquired with the code from a cardboard "loot" card.
"We think this is unique in terms of the level of integration of the two worlds," said Steve Grimes, Topps' chief digital officer. "In this game, the digital and physical world overlap more completely and deeply than anything that's been done before."
A group of private equity investors led by former Walt Disney (DIS, Fortune 500) CEO Michael Eisner last year acquired Topps, home of Bazooka bubble gum and Ring Pops. Sony Online Entertainment has made a push into digital trading card games in recent years. Sony now has 30 people working almost exclusively on virtual card games in its Denver studio.
They've had some successes. In September 2007, Sony launched Legends of Norrath, a digital trading card game in its EverQuest MMORPG franchise. It has been played more than a million times. Sony has also created digital trading cards for its Star Wars Galaxies and Star Chamber online games.
IDC gaming analyst Billy Pidgeon says he had never heard of a trading card game that debuted first online followed by a physical version.
Pidgeon was impressed that Topps was willing to create a trading card game based on a digital game that has yet to be officially launched. "That's a significant investment," Pidgeon said. "To me, it speaks to the level of confidence both Sony and Topps have in this game across the board. It's understandable. It looks great."
Ira Friedman, Topps vice president of publishing and new product development, says his company was willing to take the leap because Sony is going to market Free Realms aggressively both on television and on the Internet.
"They are going to put it on the map in a smart and effective way," Friedman said. "Once the TV and all the viral activity that they are going to create to launch this kicks in, people will look at our retail displays in Wal-Mart and Target and say, 'Hey, I saw this on TV and online. Here's my chance to get a taste of it.' "