Christian Louca

Research predicts 19% end-user spending increase

The popularity of smartphones and app stores, growing accessibility in emerging markets and improved device interfaces are contributing to the double-digit growth of the worldwide mobile gaming market, according toGartner.

The research firm estimates end-users around the world will spend $5.6 billion on mobile gaming this year, up 19% over 2009 spending. By 2014 the market will increase to $11.4 billion in spending.

“The hype around mobile application stores has opened this market up to numerous publishers and developers—further expanding revenue potential and competition in this industry,” said Tuong Nguyen, principal research analyst at Gartner, in a statement.

“Although we expect most mobile gamers to continue to gravitate toward ‘free’ games,” he said, “we do not expect the ad-supported model to take off within the next three years—despite the success we have seen with this approach in the Japanese market.”

Currently, Gartner estimates about 60% to 70% of games downloaded from app stores are free. Further, the firm believes 70% to 80% of all app store downloads are games.

Mobile still accounts for only a small percentage of total gaming revenues, however. TNS and Newzoo reported that in 2009, mobile contributed 4% to total US video gaming revenues of nearly $25.3 billion, or $1.1 billion. That proportion was similar in the UK, France and Germany, where total spending was much lower.

NPD Group estimated a lower total for 2009 US video game spending of $20.2 billion. Newzoo claims that its reliance on end-user survey data rather than retail sales provides a fuller picture of spending on used games, online subscriptions and downloads, microtransactions and virtual currency.

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