Electronic Arts Inc., the largest maker of video games in the U.S., will license Qualcomm Inc.'s operating system to grab a bigger slice of the $1.3-billion market for games played on mobile phones.
The growing popularity of wireless handsets as a game platform is luring investment from companies such as Walt Disney Co., Yahoo Inc. and THQ Inc. and may crimp sales for competitors such as Nintendo Co., which says it has no plans to put games on phones.
"Cellphones will become the world's largest computing platform," said Andy Riedel, vice president of game development at InfoSpace Inc., which sells "Ms. PacMan" and other games. "Every individual around the planet will have these devices."
Shares of San Diego-based Qualcomm -- the world's No. 2 maker of chips that power cellphones -- rose 83 cents to $38.10. Redwood City, Calif.-based Electronic Arts rose $1.57 to $54.11.
The entry into mobile gaming marks a shift for Electronic Arts, whose then-president, John Riccitiello, said in 2001 that games on cellphones were "more like a hobby than a business."
Electronic Arts began its mobile unit last year and will release 20 titles for cellphones this year, said John Batter, vice president of the company's mobile unit.
Games are the third-most-popular cellphone function, after calling and text messaging, says researcher In-Stat MDR.
About 800 million people worldwide will have cellphones with games by 2007, compared with 96 million in 2003, estimates game maker THQ, based in Calabasas.
Cellphone games are less expensive to develop and distribute than console games or hand-held versions, THQ Chief Executive Brian Farrell said.