Muse.On-The.Net

Many are willing to cast a negative light on the mobile phone game industry. Indeed, the carriers themselves can be the worst critics, willing to isolate the industry as a perpetual niche marketplace. Part of the blame is the stagnant 3% customer base willing to purchase mobile games from carrier decks. However, there are signs of growth in the industry, many not centered around the carrier deck. Perhaps the mobile games industry stands to grow with out without carrier support.

Mobile Game Companies are Thriving

The Multimedia Research Consultancy reports that, while there appears to be consolidation happening, the majority of mobile games companies are in the black and have been in business for at least five years. The overall health of this industry is robust, with a wide spectrum of players in over 93 countries. With over 1,899 companies listed, expect many mergers & acquisitions to occur over the next three years.

Beyond the Walled Garden

So where are these companies expected to reap their profits? Not surprisingly, carrier decks remain the dominate real estate for mobile phone games. However, according to Parks Associates, a shift has finally begun to off-deck sales. Specifically, off-deck sales are expected to grow 28% of the total US mobile games revenue by 2012, up from 10% in 2007.

During this time the US mobile game marketplace is expected to grow from $717 million in revenues today to $1.7 billion by 2012. Therefore, off-deck revenues will jump from $71 million in 2007 to over $475 million in 20012, or more than half the size of the entire marketplace as it stands today.

The move beyond the walled garden is attributed to systemic market forces such as the growing influence of established media companies and also experimentation with what has become the third sign of industry strength.

Free Games with Advertising is Working

Juniper Research predicts that revenue from ads in mobile games will growth from $90 million in 2007 to over $1.2 billion in 2012 - or 70% the revenue expected for total game sales. According to Parks Associates:

mobile users have expressed a repeated preference for ad-supported over fee-based content.

Certainly, ad-supported sites provide opportunities for developers to work closely with marketers. Sites like MobileRated offer services that enable rapid and smooth integration of marketer ads with developer products. Marketers now have the opportunity to promote their brands through direct advertising, game giveaways and discounts, sponsorship deals, and other promotional opportunities. MobileRated users currently download over 1 million games a month.