The market for smartphone games is expanding, and the overall revenue has zoomed past software for dedicated handhelds. There are big changes coming, though, in the way that publishers get revenue for their games, according to the latest statistics. Ad revenue is growing, and free-to-play (also called “freemium” and F2P) games are now taking the lion's share of the revenue for the top games. The data is rolled up in the accompanying infographic from analytics firm mixpanel, used with their permission.
There are some interesting data points to note: iOS games are over four times as successful at converting free users to paid users as other platforms. The virtual goods that people are buying are mostly (68%) consumables, and only 2% of the money is spent on personalization. These are important data points for developers to know when deciding on which platforms to embrace, and on what sort of virtual goods to develop for your game.
Overall, mobile gaming revenue is already over $1.5 billion in the US alone, and $5.6 billion worldwide. By 2014, worldwide revenue from mobile gaming is projected to hit $11.4 billion. Mobile gaming is a worldwide phenomenon, especially if you have a game that crosses language and cultural borders easily, such as Angry Birds. At the same time, the revenue from purchased apps is expected to slide to only 12.5% in 2014, down from 92.5% in 2010. The data and projections show a market in transition while it's growing rapidly, which makes business much more difficult for those companies in that market segment. Some companies are committing to freemium games, some want to charge premium prices for their mobile games, while others are employing a mix of monetization models. The only thing that seems to be certain is that more changes can be expected. What do you think?
