Mobile Gaming – An introduction to top players and revenue models
If you’re travelling through an Asian country, take a look around you when you’re in a crowded public space where people are waiting for a certain event to take place. For instance, commuters in an underground rail transport system waiting to reach their destination. Almost everyone will have a similar stance – head bent, shoulders slightly hunched forward, eyes glued to mobile device in hand.
These mobile addicts are usually involved in one of many possible activities – watching videos, checking social accounts, browsing the internet or playing mobile games. The latter, especially, is becoming an increasingly addictive option for those who want to kill time, improve gaming prowess or just go to the next level.
The mobile gaming industry is feeding this frenzy and is slated to grow exponentially by 2016, generating estimated revenue of $23 billion. The Asia Pacific is the biggest market for mobile games with stunning revenue of $5.9 billion (as on 2013) and an expected 25% Year-on-Year growth. Asia is followed by North America and Western Europe. These three continents also score high on the list of mobile game publishers in terms of overall global appeal.
The mobile games that are dominating people’s lives today can be categorized into the following types:
- Card battle
- Mgmt/sim (Simulated games where real-life situations are played out on game mode. Ex: Game Dev Story, Dinner Dash, A Story of A Band etc.)
- Social turn-based (where players take turns to play the game on a social platform)
- Endless (examples include Temple Run, Sonic Dash and more)
According to Apptopia, women of ages 20 to 50 were more likely to prefer game genres such as trivia, simulated games, social turn-based games, slots and solitaire (progression by age). Younger men were more likely to prefer genres such as card-battle, strategy, racing, shooter, action RPG and so on. Curiously enough, the older men seemed to have a singular preference for casino/poker games. Both sexes showed equal affinity towards endless/runner games and arcade games when younger and casino/poker games when older.
When it comes to mobile game publishers who constitute the cream, there are two ways of judging – by revenue or by number of downloads. As on March 2014, the top mobile game publishers by revenue on iOS App Store were Supercell, King, GungHo Online, Tencent and Electronic Arts among others (Source: App Annie). Going by revenue again, the list of mobile game publishers who made it to the top on Google Playstore was a little different. GungHo Online, King and Supercell formed the top three followed by LINE and CJ Group.
Gauging by number of downloads, winners on iOS App Store were Tencent, Electronic Arts, Gameloft, Mediocre and King. Google Playstore rankings revealed King, Gameloft, Rovio, Electronic Arts and LINE to be the frontrunners.
The massive amounts of revenue being generated by the mobile gaming industry makes one wonder how it all works. A mobile game publisher has multiple monetization models at his disposal to choose from.
A fairly direct approach, this model requires the user to pay the price and then play the game. This model, however, is not popular. It is more useful when it comes to widgets rather than mobile games.
Freemium model (Popular version being In-App Purchases of currencies or life)
Games that use this model allow users to download the game for free. Once the user reaches a certain stage, restrictions are imposed which requires payment to be lifted to resume the game. This approach is by far the most popular among users the world over.
Free-to-play model (A slight variation of the above)
Free-to-play models don’t require players to purchase anything to play the game. However, the options are very limited and to get the optimum experience of the game, one has to make purchases. For instance, new wardrobe for an avatar and so on.
This is self-explanatory. The user is subjected to multiple banner ads while playing the game although the entire game itself is completely free.
These monetization models are not sacrosanct and game publishers have gone on to combine features of two or more models in their games very successfully. Such combined models include Freemium + Paid (Angry Birds), Freemium + Free-to-play + Paid + Advertising (Sims) and so on.
In a survey conducted by VentureBeat Intel, Freemium in-app purchases of digital goods were perceived as the most effective, most cost efficient and most popular monetization strategy. This was followed by interstitial, video and banner ads. The least effective and popular strategies included subscriptions, paid downloads, notification and lock screen ads, surveys and so on.
Mobile games have got a pretty good stronghold on the distracted consumer today. What’s more, large players like Microsoft are buying games like Minecraft to get back into the mobile game (pun that I could not resist).