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Asia, Europe will make up 87% of global mobile, online game revenue in 2015 - report
Asia, Europe will make up 87% of global mobile, online game revenue in 2015 - report
January 15, 2013 | By Mike Rose




According to a new and extensive report from investment banking services company Digi-Capital, revenue from online and mobile games will soon make up more than 50 percent of global video game revenue -- and this shift will be dominated by Asia and Europe.

As it stands, revenue from this rapidly growing sector is currently around $31 billion for the 2012 fiscal year, making up 49 percent of all revenue from video games during the year.

However, by 2016 Digi-Capital believes that online and mobile games will make up 57 percent of global revenue from video games -- roughly $48 billion of a total $83 billion.

And by 2015, the company expects Asia and Europe to take 87 percent of all worldwide revenue from mobile and online games, with Asia in particular accounting for more than half (32 percent in China, 12 percent in South Korea and 10 percent in Japan).

The report notes that the Chinese, Japanese and South Korean video game industries are producing very cost efficent game businesses that see up to 50 percent operating margins, while high volumes of up to 20 million peak concurrent users across these territories help to push margins up.

This also means that Asian businesses can afford to invest significantly in foreign markets -- indeed, in 2012 there were more video game mergers and aquisitions than ever before, and around 70 percent of the most notable were made by Chinese, Japanese or South Korean buyers.

However, as Tim Merel, managing director at Digi-Capital, notes, "Knowledge and relationship gaps remain for mergers and acquisitions/investment between Asian/Western markets and across games market sectors."

Elsewhere, Merel says that by 2016, free-to-play games will make up around 55 percent of app revenue, and a whopping 93 percent of mobile app downloads.

"The basis of competition across games market sectors is moving towards free-to-play and communal (competitive/collaborative) games and business models," he says. "Gamification is attracting significant early stage investment, although much development remains for that market to achieve its potential."


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