Revenues from mobile games is set to soar to £7bn by 2015 with in-game purchases overtaking the traditional pay-per-download model as the primary source of
income by 2013, according to a report published today.
Juniper Research forecasts that, with
Apple’s in-app billing mechanism showing the way forward, total end-user
revenues will surpass £7bn annually by 2015, nearly double what they
were in 2009 at £3.7bn.
The report says an increasing number of games are being offered free at
the point of purchase, with in-game purchases, such as extra gaming levels or
gameplay items, being used by developers and publishers to monetise the game
once the user has been drawn in by the free offer.
However with app stores containing
thousands of applications, the majority of which are mobile games, ‘discoverability’
remains a problem for developers and publishers, says the report.
Daniel Ashdown, author of the Mobile Games report, said: ‘Discoverability can be a “chicken and egg” problem:
high downloads lead to prominence, but achieving a high number of downloads is
largely dependent on already being prominent. Consequently, a small minority of
games achieve very high downloads, whilst the vast majority achieve very small
However the mobile games industry is gaining ground, the report says. It
points to Apple’s iPhone/App Store combination as setting the benchmark, delivering
a higher share of revenue for developers, and development platforms which take
advantage of advancements in handset technology.