Nov

17

Crossing the Great Divide: Mobile Games to Overtake Consoles Next Year?

Mark Stephens

The big fat cash cow for the gaming industry has long been console gaming. But is that all set to change? Projections from research specialist Newzoo claim that mobile game revenue will overtake console gaming revenue in 2015…

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The Newzoo Analysis

Newzoo released its quarterly report on global gaming and an infographic entitled Mobile Games Market Growth Above Expectations recently. While that in itself is not very inspiring, the report does contain one big nugget of information: that smartphone and tablet gaming sales are expected to hit $30.3bn next year. This would mean that, by Newzoo’s figures, it would exceed console gaming for the first time.

One of the main areas of growth in the mobile gaming industry will be China, Japan, and emerging Southeast Asian countries, according to Newzoo. The report adds:

‘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. 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.’

So mobile gaming on smartphones and tablets is ‘winning over’ users from handheld consoles, PC gamers and even some of those harder-core gamers who play MMOs; in other words, Apple and Google are slowly ‘replacing’ Nintendo.

While this is very encouraging for the mobile gaming industry, it should be pointed out that Newzoo’s estimates for mobile revenues are higher (and for console games lower) than those estimated by the likes of Gartner, Statista and SuperData Research.

It also goes against the grain of recent suggestions that a ‘saturation point’ has been reached in Western Europe and North America, which is damaging the growth of mobile gaming. Instead, Newzoo suggests that the growth of mobile gaming is simply migrating into more emerging markets. A spokesperson for Newzoo said:

‘We are also emphasizing that the recent results of individual high-profile companies such as Rovio, King, DeNA, and Gree are not necessarily indicative of the state of the mobile market as a whole. It is not in our interest to inflate market figures, but the hard facts have forced us to adjust our estimates upward.’

The Numberzzzzzzzz…

The social gaming numbers don’t usually add up for us – they are often basically boring and change vastly depending on who you ask. You won’t often find us quoting the latest ‘market estimates’ but we thought the Newzoo figures were interesting.

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And while we’re about it we may as well take a look at some of the year’s global social gaming trends and statistics.

Estimates by Transparency Market Research predict the global social gaming market to reach $17.40 billion by 2019, which would represent an average growth rate of 16.1% from 2013 to 2019. The report, which analyses data from 2012, also estimates that virtual goods generate 60% of the revenue followed by advertising; that age group 19 – 25 years has contributed largely to the growth of social games; that females are the largest gender segment; and that the Asia Pacific region represents the largest market.

Nothing hugely new there. More interesting is what this growth means for the console gaming industry.

As the PS4 and xBox One release a host of new games in preparation for the Christmas rush in the West, is social gaming set to sweep it aside or is there life in the ‘old dog’ yet?

While there are bound to be plenty of new iPads in circulation this Christmas (playing Crossed and Hyspherical), our bet is that there will be plenty more Christmases of Fifa, Middle-Earth, and Assassin’s Creed too!