The global mobile-gaming market suffered a reversal of fortune in the second quarter of 2007 as revenues for title publishers declined by 9%, compared with 11% growth in the first quarter, according to a new report from iSuppli Corp.
David Carnevale, vice president, multimedia content and distribution for iSuppli, said: “While growth compared to the same period a year earlier was slightly positive, the second quarter dealt a significant blow to manufacturers that were expecting their profits to continue to rise.
“While the third quarter performance and the fourth quarter outlook appear optimistic, the pace of growth is slowing, causing great concern to content providers hoping to cash in on this market.”
iSuppli says that one of the main problems is that the number of subscribers for mobile games remains quite small. Game publishers’ and developers’ moves to broaden the awareness of mobile games will help build the subscriber base – but only if they target the right demographic.
Despite the short-term setback, iSuppli expects mobile gaming revenue to nearly triple by 2011, growing to $6.6 billion, managing a Compound Annual Growth Rate (CAGR) of 23.2% from $2.3 billion in 2006.
With some uncertainty associated with mobile gaming, operators and content providers instead are turning to the mobile-video market. While still in its early stages, iSuppli says that mobile-video holds the most upside potential among the premium content categories.
iSuppli forecasts mobile-video revenue will reach $14.6 billion by 2011, rising at a CAGR of 71.7% from $977 million in 2006.
While significant barriers remain – including content availability, spectrum accessibility and uncertain business models – the earlier these obstacles are breached, the faster this segment can become the largest mobile content opportunity for operators and content providers.
The latest figures from M:Metrics show that the total US audience for those who viewed mobile video grew by 34% from January to August this year (see US Mobile Video Audience Growing).
Meanwhile, research from Telephia found that Location-based services (LBS) such as navigation, represented 51% of the $118 million in US revenue that downloadable mobile applications (such as LBS, weather applications, chat/community, and personal organisation tools) generated during Q2 2007 (see Navigation Is Top Downloadable Mobile Application).
Related Links
