WHAT HE DID: He might get credit for breaking the Curse of the Bambino, but former Red Sox pitcher Curt Schilling has lately been cursed by his own investments. The video game company he founded in 2006 filed for Chapter 7 bankruptcy protection in early June. According to court documents, Schilling owned more than 10% of 38 Studios, which spent more than $133 million without scoring much revenue. A U.S. bankruptcy judge ruled last week that the Rhode Island Economic Development Corp. and Bank of New York Mellon Trust, whose loans funded 38 Studios, could take control of the company's assets. Schilling and the company did not respond to requests for comment. The case is ongoing.

WHAT WENT WRONG: Schilling's company spent millions trying to develop the next blockbuster video game, a move analysts say was like putting all its eggs in one basket in an industry where the top five to 10 video games claim ever more market share. "The big are going to continue to get bigger and the smaller companies will find it harder," says Arvind Bhatia, an interactive entertainment and Internet analyst at Sterne Agee. It's expensive and risky to try to come up with the next Call of Duty, the wildly popular shooter game. "Each title is becoming a big project," Bhatia says. Even established gaming companies have struggled: The stock of THQ (THQI) , for one, has fallen more than 40% so far this year; in July it traded as low as $0.62. But 38 Studios had one advantage over many start-ups -- it partnered with leading game manufacturer Electronic Arts to help distribute a new fantasy action game. Ultimately, the title they developed failed to compete with gamers' longtime favorites.

WHAT YOU CAN LEARN: For those looking to pitch the perfect game, analysts say, Schilling's approach may not be the way to go. His company focused on the traditional side of the gaming spectrum -- the kind with separate consoles and handheld controllers. But Xbox-type games cater to a different type of consumer and carry different risks than the new wave of titles aimed at social networks, smartphones and tablets.

Traditional video games are a bigger ticket purchase and have a cyclical sales pattern timed to the releases of console hardware upgrades, so they have a longer shelf life than most mobile games. Proven titles and their sequels perform best and also afford opportunities to sell fans online content and other merchandise in between game purchases. (The Madden football game series has an advantage with brand recognition alone.) But they also have greater "hit-or-miss risk," says Atul Bagga, an Internet and video game senior analyst at Lazard Capital Markets. Social media games, by comparison, are cheaper to produce so require less upfront investment. "If you're thinking of getting into games, at least getting into the business is a lot easier in social," Bhatia says.

Social media games pose their own challenges, of course, experts say. Developers need to constantly interact with players and roll out regular innovations to keep the attention of fickle gamers.

Electronic Arts is well-positioned because it has spread itself across the industry by being platform-agnostic. By making games for both the Web and for PlayStation 3, the company can cater to whichever medium gamers flock to more. Another boon for EA is the plethora of free-to-play games the company offers: Its revenue from such games nearly tripled in the third quarter from the year before. It would take a great deal of time and effort for a start-up to compete with such a diversified game giant.