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Monday, February 20, 2012
EA Regains Mobile Games Market Lead

After slipping to number two spot, EA Mobile reported a strong Q4 to retake its position at the top of the Western mobile games market.

Backed by its tried and tested strategy of offering steep discounts to dominate the top games charts, EA took advantage of the growing seasonality of the mobile games market (with new devices bought in the holiday season boosting sales) to achieve a record $70m Q4 revenues, according to an IHS Screen Digest report. Gameloft fell back into second place but still achieved record $63.3m Q4 revenues, bringing its annual total up 22 per cent to $187.3m. Gameloft's legacy feature phone business experienced a slight decline in Q4 2011, but this was more than offset by its impressive growth in revenues from games for smartphones and tablets. Smartphone growth was not enough, however, for Glu to offset its decline as Q4 revenues dipped 3 per cent year-on-year to $15.2m. Western companies could do little to match the success of Japan's Konami, whose success on domestic Japanese mobile social networks such as Gree saw its revenues jump to $124m in Q4 2011.

Smartphone, tablet and mobile social gaming continued to be the driver of growth in the mobile games business in Q4 2011 with leading Western publishers EA Mobile and Gameloft reporting record Q4 revenues. In Japan, leading mobile social games provider Konami maintained its revenue lead in the global mobile games business with $124m quarterly revenues.

At the end of a remarkable year for mobile social games in Japan, the leading network by revenues Gree reported over $500m quarterly revenues for the first time. However, it was not all good news. Gree's leading Japanese competitor saw its mobile games related revenues decline quarter-on-quarter for the first time since it launched its games platform in 2008 (though revenues were still up year-on-year). As the Japanese mobile social games market matures, IHS Screen Digest expects to see a continued push for international expansion from these leading Japanese players.

In Western markets, Zynga continued to see growth in its mobile audience - up to 15m daily active users from 9.9m in Q3. But in its first quarterly report as a public company it failed to break out mobile revenues (a possible sign that despite the growth in users, monetisation is proving tricky). All eyes are now on Facebook - which filed its IPO in Q1 2012 - which has yet to realise its mobile revenue potential, a situation it cannot maintain for much longer.

Amazon, which first launched a smartphone application store in early 2011, made a big impact with the US launch of its Kindle Fire tablet in Q4 2011. Running a modified version of Android, mobile games developers quickly embraced the new device - making it the most popular platform for new releases from major mobile games publishers in Q4 2011.

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