Mobile Gaming: The Business Model For Freedom and Fantasy

Mobile gaming has by far made the greatest impact on – and effected the most change in – the overall gaming industry.

From a dollars & cents perspective mobile gaming revenue is projected to surpass console game revenue in 2015 to the tune of $30.3B vs. $26.4B (*), with on-going growth in mobile device sales only driving this trend forward in 2016 and beyond.

The revenue and user growth, however, are merely an expression of results. And as much as those variables are what investors, media and the game companies pay closest attention to, they don’t tell us much about why mobile gaming has had such a profound impact on the gaming market at large.

Start with the advent of video gaming. If you asked 100 people what the first video game was the greater majority would answer Pong, which was created and released in 1972 by Atari founder Nolan Bushnell and his then partner Ted Dabney.

What most of those 100 people wouldn’t know is that Pong was a creation by Bushnell and Dabney that followed their initial foray into gaming by way of Galaxy Game and Computer Space, both of which were released in 1971 and were bi-products of what many consider to be the true original video game, Spacewar!, created in 1962. Regardless of what was the first video game or who should get credit for it, something that feels less open to debate is why video games were invented in the first place.

There were certainly practical benefits to emulating real life behavior, such as flight simulators for training pilots, but what video gaming did was expose humans to a freedom of expression and movement that couldn’t and can’t be achieved in any other type of gaming or through any other medium.

I love playing basketball but can only shoot 3’s like Steph Curry when pretending to be him in a video game. And I love reading, but my ability to assume the identity of a character I love in a given book starts and ends inside my head. Video games give the unique freedom to pretend to be something you’re not alongside abilities usually impossible to humanly possess.

Thus it makes sense that all variations of video gaming have evolved along this trajectory, starting with the virtual emulation of basic activities like chess or ping pong, to the play of such games at a level no one would be able to achieve in real life, to then general activities (say flying a fighter jet or driving an F1 car) that for lack of knowledge and skills one could never do in real life.

It is this expansive freedom to explore and fantasize that drives people to justify paying for things in a game that are absolutely not real, much to the chagrin of non-gamers or investors who don’t dabble in the space. And once a gamer has a taste of the freedom gaming provides, desire becomes demand and entire businesses are built to meet it.

To me this is what mobile gaming and the overall industry has been the beneficiary of, but what mobile business model innovation has made possible. Plenty of popular games and brilliant game developers have spurred the gaming industry to its current pop culture height, but in-app purchasing via mobile platforms has truly tipped the balance of gaming power.

All of this has lead to amazing growth and wealth creation, much faster execution on the part of traditional console game developers in relation to mobile, and to actual cross platform gaming rather than the promise of it. Peter Warman, CEO of Newzoo, made an interesting statement in a recent Forbes article about the dominance of mobile gaming in relation to other platforms:

“Smartphones and tablets have given gamers two new screens to play games on in addition to their TV and PC screen. Because U.S. consumers use all four screens, mobile gaming does not replace console or PC gaming. Moreover, it gives gamers the possibility to play games anywhere at any time, pushing overall time spent on games in the U.S. up 40% in only two years.”

There is a subtle implication in this statement, which is the effect that mobile gaming has had on the games themselves. Sure there are more screens, but people are playing more because there is a surge of incredible games for a wider range of gamers.

Peripheral hardware that was once only compatible for a single platform can now integrate with multiple platforms, and Start-ups such as Mobcrush, through unique technology and platform innovation, are creating easier ways for gamers to play whatever they want, whenever they want and across any platform.

Once in-app purchasing became a reality in mobile gaming, it forever transformed that universal desire & demand for freedom of movement and expression from a concept of human nature to something quantifiable, measurable and financially ground breaking.


(*)Source: Newzoo

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