2015 Predictions for Mobile Gaming

The mobile gaming industry experienced significant market consolidation throughout 2014, as a small group of developers captured an increasing share of top-grossing rankings. Data indicates that the proportion of the top 20 grossing iPhone titles in the U.S. held by just four developers rose from one-third to nearly one-half between December 2013 and December 2014. This trend was driven by rising user acquisition costs and the competitive advantages held by larger firms with substantial capital.

Looking toward 2015, the industry is expected to see a diversification of user acquisition strategies as smaller developers seek to bypass expensive traditional marketing channels in favor of organic growth and viral mechanics. Simultaneously, the ad tech sector faces further consolidation. As major platform operators like Apple, Google, and Amazon increasingly provide free, integrated analytics and attribution tools, the value proposition for independent third-party ad tech providers diminishes, likely triggering mergers and acquisitions by larger enterprise or consumer technology firms.

Geographically, the Chinese market is projected to become a focal point for Western developers. With the Asia-Pacific region potentially accounting for nearly 40% of global mobile gaming revenue by 2017, strategic investments from Chinese conglomerates into Western studios are expected to increase. These partnerships provide Western firms with both capital and direct access to the Chinese market, which grew by 93% to reach nearly $3 billion in 2014. Finally, the industry is shifting away from tablet-only development. Due to slowing tablet sales and the rise of phablets, developers are prioritizing hardware-agnostic designs that accommodate both short and long gameplay sessions, effectively ending the era of tablet-exclusive mobile gaming strategies.