Retoy: A fistful of plastic, made to order

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Credit: Rovio

Physical toys, digital goods.

It's hard to ignore the Skylanders phenomenon (especially if you're the parent of a school-age child). The concept -- a Bluetooth-enabled toy line that interfaces with a video game -- appears to be a popular one, as Skylanders has netted over $2 billion in sales with 175 million toys sold. It was an unexpected coup for publisher Activision, and Disney has followed suite with Disney Infinityits own take on the idea. 

The smartphone and tablet game developers want a slice of that pie, but going from app to toymaker is a heck of a chasm to cross if you don't have the deep pockets of a major publisher. That's where New York City-area startup Retoy, technically a subsidiary of accelerator bMuse, comes in. Retoy has already helped Angry Birds developer Rovio sell physical toys and integrate them with their games. And at the DEMO Enterprise conference on April 3, Retoy is publicizing a private beta to let any developer offer their customers toys that work with their games. 

"We want to crack the Skylanders problem for mobile," says Retoy Founder and CEO Josh Shabtai.

If you've never played a game that uses physical toys, the concept is both simple and insidious: Usually, the game itself may come with a handful of characters or levels, but to get the most out of it, you need to go to the store and buy plastic toys with Bluetooth antennas and a little bit of storage that let you access additional content.

Individual toys are smart enough to remember any progress made with them when you sync them back up with the game. Kids and collectors like having something physical to play with and keep around even when they're not playing the game -- an advantage over in-app content that can command a premium. But having to include Bluetooth and a flash drive in every toy drives the price way up. 

Which is Retoy's first big innovation, says Shabtai. Where console games require wireless access to interface with the game, smartphone developers can count on their users having a camera. So rather than build the intelligence into the toy itself, each Retoy-made action figure has a three-dimensional barcode that's easily interpreted by your standard mobile camera with the help of a magnifying lens "base." The information about what the toy actually has to do in the game when scanned is stored in Retoy's cloud. 

Which leads into Retoy's second innovation. More than just a manufacturing service, Retoy offers a platform: An SDK helps game developers integrate the toys with their code, and an API helps them offer the toys on-demand from an in-app storefront (including billing, transactions, and shipping). All a developer has to do is upload a 3D model and the Retoy platform helps turn it into a toy. 

Finally, from a manufacturing standpoint, Retoy combines on-demand 3D printing and the traditional factory method in different amounts to help developers of all sizes transition into the market. Smaller developers will have to charge slightly more for lower manufacturing runs, but it's still in the realm of affordability, says Shabtai. 

"We're not looking to make $99 toys," he says, referring to Figureprints, which offers customized World of Warcraft 3D printed toys based on player characters.

In fact, Retoy powers Rovio's Angry Birds Star Wars 2 and Angry Birds Go! efforts in this arena. The toys, which Rovio and partner Hasbro market as "telepods," sell in the $12 range for five or so smaller characters, whereas Skylanders sells packs of two characters and an in-game item for an MSRP of $25 each. The Skylanders characters are slightly larger, but the price advantage can't be beat, especially when you consider that the game's starter kit carries a $75 price tag versus Angry Birds and its free-to-play approach. 

In an age where kids are saving their allowance for in-app purchases, Shabtai says, toys offer a unique bridge between the old and the new, especially when parents would rather buy their kids something tangible. For independent developers, it could be a path to profitability. 

If you're interested in that beta, signups are open at the Retoy web site.

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