Expansion of Mobile Gaming

The expansion of smartphones and tablets has opened video games to a new demographic who previously would have scoffed at the idea of gaming. But now, 78 percent of the world’s 1.2 billion gamers play mobile titles. That number is expected to grow as smartphones and tablets penetrate more of the market. This growth is so explosive that revenue from mobile games in 2015 is set to eclipse traditional console and PC video games, according to a study by research firm Newzoo.

Newzoo and its partner AppLift, a mobile game marketing firm, estimate that revenues from smartphone and tablet games will reach $25 billion in 2014, up 42 percent from 2013, $30.3 billion in 2015 and $35.4 billion by 2017.

In the United States alone, a study by eMarketer says U.S. mobile game revenues—including downloads and in-app purchases—will grow 16.5 percent in 2015 to reach $3.04 billion. This means that mobile games will account for 30.9 percent of the entire U.S. mobile content market this year, an increase from 29.3 percent in 2014. In the study, eMarketer includes music, videos, games and books under the umbrella of mobile content.

Overall, Western Europe, North America and Asia Pacific are the most profitable markets for mobile game publishers.

From the report:

“Our research shows that the high mobile growth rate is driven by both ‘organic growth’, lifting the overall market, and ‘cannibalistic growth’, at the expense of other segments,” the Newzoo report states. “In addition to the initial casualties of mobile growth (handheld console and online casual and social gaming), Newzoo notes signs of slower growth in (online) PC games and MMOs as spending is diverted to mobile devices.”

Mobile growth is becoming such a powerful force that large game studios like Warner Bros. Interactive are beginning to focus development efforts specifically on mobile platforms instead of solely consoles. These games will coincide with the launches of the console games these mobile ones are based off.

Venture Beat reports that the games announced so far include Batman: Arkham Underworld from Turbine, Lego Batman 3: Beyond Gotham from TT Games, DC Comics Legends from WB Games San Francisco, Game of Thrones from Turbine, and Mortal Kombat X from NetherRealm Studios.

“Our mobile business has been a key priority for the company, and we are utilizing our incredibly talented internal development teams to create games with marquee franchises,” said David Haddad, executive vice president and general manager for Warner Bros. Interactive Entertainment, in a statement. “We’ve seen tremendous growth with our mobile business and expect to increase our market share by applying our best in class development, publishing and brand marketing to this impressive slate of games.”

This will surely fuel the mobile gaming revenue fire. As more top developers jump into the fray, the question won’t be if mobile games will continue to succeed, it’ll be if handheld gaming can continue to exist. And if handheld gaming decreases, we definitely expect to see the price to sell game consoles to decline, too.

The Global Mobile Landscape

Image Courtesy of: http://www.newzoo.com/infographics/infographic-the-global-mobile-landscape/

Co-founder at uSell

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