How can mobile gaming prove it’s more than just a cash cow?

The global gaming industry is massive, generating just shy of $165bn last year - meaning that gaming revenues are fast closing in on more established sources of entertainment like video and professional sports. Of that total, console games accounted for around $33bn of revenue, and the PC market made up about $40bn. The remaining $85bn, you ask? All thanks to mobile gaming. 

Mobile gaming has done very well indeed during the COVID-19 pandemic, and shows no signs of slowing down. Just this morning, AppLovin, a mobile gaming company responsible for popular titles like Matchington Mansion and Wordscapes, raised $1.8bn in an IPO, which has raised its market capitalisation to $28.6bn in one of the biggest public debuts of the year so far by any company.

There are an estimated 2.5bn mobile gamers around the world, according to data from Newzoo - roughly the same as all the PC and console gamers combined. Now, these figures don’t account for overlap; someone who owns a Nintendo Switch or an Xbox is almost guaranteed to also own a smartphone, and probably has a game or two downloaded on it. But the fact that there are around 5.22bn people (about 66% of the world’s population) carrying around a smartphone right now, the rampant success of mobile games becomes a little less shocking. 

If you want to play The Legend of Zelda: Breath of the Wild 2 when it comes out (and trust me, you do; this one might let us pet the dogs) then you need to drop about $299 on the console you need to play it (and the Nintendo Switch is easily the cheapest current-gen gaming platform on the market, with the Xbox Series X and PlayStation 5 retailing at $499.99 - and don’t even get me started on how much it can cost to build a gaming rig for PC) before you've even bought the game itself. 

While that’s not much compared to a flagship smartphone, phones can be used as, well, you name it. From email to social media, video streaming and browsing the internet, there’s a whole lot that a phone can do that a console can’t. 

So, lack of portability and a high price associated with a console vs portability, versatility and more bang for your buck when it comes to your smartphone (heck, most of the games are even free). That figure - 2.5bn mobile gamers - starts to look a lot less impressive when you consider the fact that more than double that number of people already own the platform they need to download a game and play it. 

Why aren’t mobile games more popular?

Remember when I said most of the games are free? If you’ve downloaded a “free” mobile game, it probably didn’t take you long to realise that the vast majority of these games are “free-to-play” but “pay-to-win”, leveraging in-game microtransactions that encourage players to spend small amounts of money here and there to gain better items, unlock new characters, or even progress past a certain point. 

The practice is pretty universally reviled, but the counter argument from the mobile games industry has always been that customers just aren’t willing to pay the same kind of money for an app that they are for a “real game” on a console. The low barrier to entry that, on the face of it, is mobile gaming’s greatest strength is actually its greatest weakness, as the “freemium” element of mobile game design often supposedly creates an experience that rewards spending a few dollars here and a few dollars there over actual skill. 

Back in 2019, for National Video Games Day, Xbox tweeted a message tagging its fellow platforms, saying that “No matter what you call it, one thing that unites us all is the X button”, with an accompanying picture of a Switch, Xbox and Playstation controller, as well as the X key on a keyboard. The internet wasted absolutely no time in adding a fifth entrant: a paywall popup on a mobile game with a tiny X in the corner to cancel the ad. 

Courtesy of Starecat.com

Nelson Schneider, a columnist at Metled Joystick wrote in that same year that, “In spite of the huge amount of money mobile gaming generates, it is well-known among Core Gamers as a hive of scum and villainy,” adding that mobile ports of popular PC and console games like Diablo “are met with heckling and derision,” and that “We’ve caught onto the fact that mobile games are shallow imitations of the ‘real’ games we care about, with cynical monetisation tacked on.” 

The mass revulsion that “real gamers” feel towards mobile as a platform hasn’t gone away. And why would it have? Mobile games are raking in obscene amounts of money with a model that clearly makes good financial sense. Or does it? Is there a better way?

This week, Eric Switzer of The Gamer wrote an interesting piece in which he notes that “There are plenty of worthwhile experiences to have on mobile, but they tend to get buried under a pile of trash.” He adds that “For every ten greedy pieces of junk mobile games like Crash: On the Run, there’s an equally ambitious and valuable game like Monument Valley or Downwell.” 

Both of those games he mentioned also have well-received console and PC versions, and are firmly wedged into the “indie darling” category of lovingly crafted, niche-ish audience gaming experiences. 

Think of them like The Blair Witch Project, a low-budget, lovingly crafted and truly innovative film that, in its own way, redefined the horror genre. What came next? Paranormal Activity. And Paranormal Activity 2, Paranormal Activity 3, Paranormal Activity 4, Paranormal Activity: The Marked Ones, and Paranormal Activity: The Ghost Dimension. Cheap genre clones of popular indie games are, sadly, a huge problem in the mobile gaming industry, where app stores can’t (or won’t) police intellectual property as effectively as it’s overseen on other platforms. 

A side-by-side view of the eerily similar artwork in Monument Valley and Skyward - courtesy of YouTube user BitStern. 

Shortly after the launch of Monument Valley, mobile game studio Ketchapp released Skyward. Tim Seppala, a writer for engadget notes that the time that, “Whereas Monument Valley is a relaxing, almost Zen-like experience that's more about logic puzzles than twitch reactions, Skyward is a shallow attempt at disguising a tired Flappy Bird clone by wrapping it in pastel colors and M.C. Escher-like aesthetics. Oh, and it's full of obtrusive ads for retirement planning and compact cars -- junk that's thankfully missing from Monument Valley.” 

Here you have the other big issue with the mobile industry: that sad reality that, as Seppala wrote back in 2015, “plenty of people will download the knockoff because it doesn't cost anything, while Monument Valley will set them back less than a venti latte from Starbucks.”  

So, how do we fix it?

The shortsightedness of the mobile gaming industry’s business model is, sadly, a bit of an ouroboros. Consumers expect games to be free because mobile games are so often of inferior quality compared to console games; game studios make their games free because customers won’t pay money upfront, but need to recoup their costs somewhere, and so have to make inferior games that include things like microtransactions; and so on… Switzer writes that, “I wish I didn’t have to defend mobile as a legitimate gaming platform in 2021, but there’s just no way to deny that the mobile well has been poisoned for a very long time.”

As an alternative, Switzer holds up Riot Games - the studio behind massively popular MOBA League of Legends - as a possible way forward. “Luckily, trhere’s at least one studio that’s making a concerted effort to legitimize mobile gaming to the “hardcore” audience,” he writes, noting that Riot’s latest release, Legends: Wild Rift, does its best to provide a comparable experience to its PC and console properties. The games are still free-to-play, but microtransactions are purely related to cosmetics (items unlocked in game that don’t have a mechanical impact on how you play) and things like battle passes (basically achievements that give you bragging rights and shinier badges). It’s a very similar model to the one employed by Valve’s Dota 2 - another very popular MOBA (sorry - that thanks for multiplayer online battle arena. Think of it as a tower defence game with RPG elements). 

It’s a promising solution: disconnect microtransactions from mechanical components for a truly cosmetic (and therefore optional) experience. This approach is probably only going to be viable for AAA studios with the upfront capital to burn building a massive user base. 

The other solution is the “indie auteur” route: build the impression of games-as-art or narrative that means people are just as willing to pay $4.99 for a game as they are for a movie ticket or a venti latte from Starbucks. The issue here is the game cloning. If regulation of marketplaces like Google’s Play Store and the iOS store can be tightened up to exclude games that breach intellectual property rights - or at least curate their selections a little better - then gamers would spend less time choosing between something mediocre and “free” and a genuinely pleasing experience with a small upfront payment. 

However, Schneider noted all the way back in 2015 that, “Trusting in Apple and/or Google to legitimise mobile gaming through the co-option and corruption of Indie games seems to embody the proverbial foxes guarding the proverbial henhouse.” He added: “Apple and Google are the ones who got us into this mess in the first place. If not for the heavy-handed advertising and monetization they encouraged app developers to employ, mobile gaming may not have traveled down the dark and sordid path that it did.” 

With $85bn on the line every single year (and Apple, for example, taking 30% of the revenues generated by every single app in its store) it doesn’t look like that particular status quo is going change any time soon.