With games accounting for 70 to 80 percent of all mobile downloads, research firm Gartner believes mobile gaming revenues will by rise by 19 percent this year to hit $5.6 billion.

That's according to the predictions made in its latest report, Market Insight: Mobile Gaming Expectations Boosted on Application Store and Smartphone Popularity which states such growth is both solid and sustainable, revenues set to top $11.4 billion by 2012.

"The hype around mobile application stores has opened this market up to numerous publishers and developers - further expanding revenue potential and competition in this industry," says Gartner principle research analyst Tuong Nguyen.

"Although we expect most mobile gamers to continue to gravitate toward free games, we do not expect the ad-supported model to take off within the next three years - despite the success we have seen with this approach in the Japanese market."

 

No free-for all on freemium

Indeed, Gartner's figures suggest the prominence of the freemium model – which has seen high profile releases on iPhone of late – has been overplayed.

The firm states free games make up 60 to 70 percent of all downloads - a hight figure it nonetheless believes will merely remain steady for the next three years.

Interestingly, Gartner also suggests mobile gaming has been boosted by an inability for consoles to take off in emerging markets.

Consumers eager for games have almost pushed into buying mobile handsets instead.

Other factors behind the growth of revenue include improved UI, controls, additional billing methods and new features such as GPS, camera and accelerometers, which all enhance gameplay.

Changing state of play

"Mobile gaming will remain an important component of consumers' value-added service offerings, as well as a revenue driver for CSPs (communication service providers)," adds Nguyen.

"On the high end, consumers will benefit from more-robust devices, such as smartphones, better cameras, more brilliant displays and increased processing power, to improve the gaming experience. Users from developing markets will also benefit as more-capable phones move down-market.

"Moreover, as more devices become connected, consumer electronic devices, such as tablets and portable gaming consoles, will join this space, adding another aspect to the market."

The full report can be purchased from Gartner for $1,295 from the firm's website.

[source: Gartner]