TUAW Interview: Freeverse CEO Ian Lynch Smith on the Ngmoco purchase

We were all pretty gobsmacked last night with the news that iPhone gaming developer Ngmoco had purchased longtime Mac game developer Freeverse, so we went hunting for answers. Fortunately, Freeverse CEO and founder Ian Lynch Smith was nice enough to sit down and take our questions this morning, and he provided a little more background and insight on the deal.

The first thing we wanted to do was what would happen to Freeverse's extensive Mac catalog, and we were told conclusively that "it's not going anywhere at all." While Freeverse will still "sell and maintain" their Mac titles, Smith did tell us that they've "been pretty much exclusively focused on the iPhone for the last 18 months anyway," so while they have a legacy in the Mac, the company believes that OS X is "on a collision course with the iPad," and that the main opportunities and user bases for Mac software are now using the iPhone and, soon, Apple's tablet. "It's very hard," we were told, "to get the volume that the iTunes App Store has" for purely Mac software.

The other big question we had was what Freeverse thinks of Ngmoco's insistent support on the "freemium" model (where games are free-to-play, with extra content or add-ons to purchase later), something that has a lot of customers up in arms. Hit the "read more" link below to see what he said both about that and what he thinks about the iPad and the future of computing.

Perhaps not surprisingly, Smith and his company is behind the Ngmoco model one hundred percent. "Obviously," he told us, "we didn't and wouldn't have gotten into this just for the sale. We didn't need to do this. We're profitable." But in the same breath he admitted that the traditional paid model (which Freeverse has used for all of its games right now) just isn't growing the company. "If Apple had a minimum price of 25 cents, the stuff on Top Paid Apps would be 25 cents right now. ... We wouldn't be having this conversation if iPhone apps were $20, but iPhone apps are basically free on the paid side."

Which means that Freeverse is more than happy, with Ngmoco's support, to go with a "freemium" model: "Flick Fishing has over 1.7 million paid users," but when you go to look at the audience for free games, "we're talking 17 to 35 million people." Smith says that just doesn't compare to the paid side or anything else. "On the Mac, we'd sell 10 or 20 thousand units and it was one of the best sellers of all time." And so that gigantic free app audience is what the company needs to go after, and Ngmoco is a company that will help them do exactly that.

Not to mention, says Smith, that the freemium model is a better way to make money, despite what customers think about it. "On the free model," he told us, "you can monetize even people who don't buy anything ever." Smith says that there are lots and lots of iPhone users who have nothing but free apps installed on their iPhones, who play hours and hours of games but have never paid a cent to the App Store. "Everyone's cheap, I'm cheap," he admits. But with this model, "there's ways to generate revenue from the 90% of customers who never pay a dime but still want to play your game."

We asked him what Freeverse titles would be going to the new model, and he said all of that would be determined going forward. He assured us that most of their popular iPhone titles would remain in their current form for the foreseeable future -- "Flick Fishing will stay on the paid side" -- but he admitted that some of their lower-selling titles might benefit from a change: "There are some titles that only sell through the visibility that free brings them at some point."

We asked him about the iPad, and even he admitted he was about as "bullish" as a developer can get. "The iPhone OS is, for most users, better than the desktop metaphor. The iPad is the start of something big." He says that Freeverse was one of the first companies on the scene with the iPhone, and they plan to do the same on the iPad. "We're always pushing that envelope."

Finally, he wants to thank all of Freeverse's customers for their support in the past, and promises that the company is still committed to the platform as they have always been. Ngmoco is a good fit for them, he says, because they understand how to fit a good game on the App Store ("we could tell they got it"), and Freeverse plans to take advantage of their experience and resources. "I'm looking forward to using their lawyers and acccountants," Smith joked. "But," he says, "Freeverse will stay with its own office and people in the middle of Brooklyn. Ngmoco didn't buy it to mess it up." And he specifically wanted to thank all the Apple and Mac fans over the years for their support.

Sounds good -- while the news of the purchase last night made us wonder what Freeverse thought of the "freemium" model, it turns out that model is the main reason, more or less, the purchase was made. Smith admits he's "sold" on it -- we'll have to see if a partnership with Ngmoco can bring one of the more storied Mac game developer the growth they've been looking for.