Steady as she goes as challenges still remain
More handsets and more titles will deliver steady growth in European mobile gaming, although billing mechanisms, porting costs and a complex distribution system will continue to stop the sector from growing exponentially, a report from Frost & Sullivan will claim.
The report said that the European mobile gaming market was worth €850 million in 2006, a number that Frost & Sullivan thinks will grow to €2.4 billion by 2012.
”The future of gaming will be determined by the type of mobile devices available to customers and the quality of games delivered onto these handsets,” Frost & Sullivan ICT Industry Manager Pranab Mookken said. “The processing capabilities and screen sizes available on Smart phones/PDAs combined with quality 2D and 3D games will be key to promoting the growth of mobile gaming in Europe.”
While operators will attempt to create awareness and educate customers with embedded offerings, the market will grow and mature only with the variety offered by large off-portal storefronts who play the role of discounted super-markets.
Off-portal storefronts combined with super-distribution will be the most important sales channel for the mobile games markets. Interoperability between devices and applications will also be essential for real-time applications.
“Super-distribution capability will drive the small but high value segment within the mobile gaming market, generating higher revenues for the entire industry,” adds Mr. Mookken. “The creation of communities using IMS and other IP-based ecosystems is already supporting enhanced games usage. “
However, due to mobile gaming being a niche market in general, steady and not exponential growth is being projected.
“Not everyone likes to play games, therefore the gaming market is a niche market,” explains Mr. Mookken. “Operators and the industry should understand that while there is a scope for higher usage, the varied circumstances that users find themselves in during the course of a day, is likely to limit the number of subscribers who will purchase a game.”
At the same time, high porting costs are further increasing the cost of game development in a market already fraught with risk. Porting costs are often as expensive as the cost of game development, therefore adding to the cost of the game to the consumer. Besides, high porting costs means that publishers and even operators cannot often make the game available to as many devices as they would like it to be compatible with.
“The need is to create, innovative purchase mechanisms while incentivising mobile gaming services for customers, through marketing and promotional bundles with other content applications – driving non-gamers, or casual gamers using only embedded content, to see some value in purchasing mobile gaming,” advises Mr. Mookken.
“Handset manufacturers and game developers need to work closely to limit the number of APIs, screen sizes and other software and hardware which are often barriers to game deployment.”