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Ovum predicts that annual mobile games revenue will nearly double over the next five years, reaching $71.5bn in 2021 globally. At the same time, Android will overtake iOS next year as the highest-grossing mobile games ecosystem. However, Apple's App Store will remain the highest-grossing marketplace until 2021.
In just a few years, mobile gaming has gone from being a peripheral, looked-down-upon segment of the videogames industry to being the most lucrative part of it, with its revenue overtaking that of both console and PC games.
Ovum's recently published Mobile Games Market Forecast: 2016–21 shows that, despite increased market maturity and a marked slowdown in download numbers over the coming years, mobile games revenue growth will remain strong – as evidenced by the phenomenal success of augmented-reality (AR) title, Pokémon Go, which has broken the record for the most revenue grossed by a mobile game in its first month.
Ovum estimates that average revenue per game download will increase from $0.35 last year to $0.51 in 2021. Global revenue has gone from $8bn in 2012 to a projected $38bn this year.
Apple's App Store has historically contributed the biggest chunk of mobile games revenue (2012–15) and will continue to do so over the next five years (2016–21), but Google Play will gradually take market share away from it.
Moreover, if other Android stores are added to the equation – primarily China's many indie stores – the App Store will lose its supremacy in 2017.
According to Ovum's calculations, China is now the top country in terms of both mobile game downloads and revenue. The Asian giant currently accounts for about half of all downloads, and it overtook the US as the top-grossing country last year.
Despite China's dominance, the developed world accounts for – and will continue to account for – the greatest share of mobile games revenue throughout the forecast period. Downloads on the other hand will, thanks to China, continue to be dominated by emerging markets.
Furthermore, emerging markets' share of both downloads and revenue will increase going forward, driven by much steeper growth.
For the purposes of these forecasts, Ovum defines mobile games as downloadable gaming apps built for smartphone/tablet operating systems such as Android and iOS. It does not include feature-phone Java games.
Mobile games' revenue calculations are confined to money generated through end-user payments made via app stores for in-app purchases, paid downloads, and subscriptions (the latter are being introduced for all app categories by both the App Store and Google Play). Advertising revenue is excluded, but Ovum will be sizing and forecasting the in-app advertisement market later this year.
Mobile Games Market Forecast: 2016–21, ME0002-000705 (September 2016)
Mobile Games Forecast Report: 2016–21, ME0002-000692 (September 2016)
Guillermo Escofet, Principal Analyst, Digital Media
Consumer & Entertainment Services
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