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Why the continued rise and rise of mobile gaming is not guaranteed

What goes up...
Why the continued rise and rise of mobile gaming is not guaranteed

Could mobile gaming die? 

The idea seems ridiculous, but its current popularity and business models are byproducts of dramatic changes that have influenced in the gaming industry over the last few years.

So while I get the sense that mobile gaming will continue to expand, there are too many possibilities to be blindly optimistic about the future.

Change could happen that will harm mobile gaming and impact the companies that operate in the sector.

Growing conservativism

A simple case in point: player tastes could change.

Clash of Clans and Candy Crush Saga are still the defining mobile games of our time because they *keep* making money - each generates over $1 billion a year.

And here's where the problems come in: the free-to-play industry isn't exactly known for its overwhelming creativity.

Because the formula to get games to make money without charging up front is so difficult to figure out, conservative game design now dominates and that means making either a match-3, asynchronous multiplayer strategy game, or a casino game.

<em>Clash of Clans</em> - rinse and repeat?
Clash of Clans - rinse and repeat?

Equally, these games have such long lead times because balancing the user experience is so tricky; that is why it's difficult for companies to react quickly to change.

Change could happen that will harm mobile gaming.

That's why you see the likes of Disney and Activision still launching their own branded takes - Star Wars and Call of Duty respectively - on Clash of Clans.

Structural change

This stasis has several knock-on effects.

When the next big game concept comes along - one that launches a thousand imitators - then the cycle will begin again, but it's unlikely to be as lucrative as what we've seen before.

This is because it's harder for game developers to be creative and break big - commercially - into the market.

Sure, as we've seen with games like Flappy Bird - and currently to a lesser degree with Crossy Road - it's easy to make a big cultural impact, but these are not highly monetizing games: that's part of their appeal.

Where did Disney get the inspiration for <em>Star Wars Commander</em> from?
Where did Disney get the inspiration for Star Wars Commander from?

Indeed, there is an argument that one way F2P games will compete in future is by providing the same amount of time value to players while monetizing them at a lower level.

The constantly rising price of UA is reducing the profit margins of all mobile gaming companies.

With time being a fixed quality for most players, this could result in a subtle contraction of money spent in mobile games overall.

Similarly, while the top grossing chart does serve as a discovery mechanism that reinforces existing games, Apple and/or Google could easily de-emphasize or remove it, and the big players increasingly rely on other forms of user acquisition than App Store features - either official or unofficial.

The constantly rising price of user acquisition is already having a strong impact in terms of reducing the profit margins of all mobile gaming companies.

Whatever happened to Nintendo?

And, perhaps more significantly, there could easily be a shift in technology that harms mobile gaming.

Mobile gaming is a secondary use of mobile phones. Why do people have phones primarily? Because they allow people to communicate with people they know about, and to keep up with social networks. Yes, passing time by playing games is an important factor, but phones ultimately serve their functional purpose before they serve the purpose of being gaming devices.

Changes in public perception could impact the sector's profitability
Changes in public perception could impact the sector's profitability

If something comes along that does that job better - or becomes the preferred way of doing things, then gaming could be hurt as those players just straight up disappear.

Even regulatory concerns could play a role. If governmental panic over in-app purchases continues to where much strict regulations come in to play, the way that games make money could change. And that could scare away some companies from entering the market. It could change the kinds of games that get made, and affect how much money current games make.

On the other hand

But maybe we should end on a more positive note.

Mobile gaming is a secondary use of mobile phones.

Despite everything I've just written, it could shift the other way. Studios could make games that wind up making more money, particularly as people previously acclimated to the model of paying up front begin to accept paying via in-app purchases more: and as mobile is light years ahead of the pack in that business model, and with things like fingerprint scanners for password input, makes spending money incredibly easy.

More people will have mobile devices, so more people are likely to be playing mobile games, and that means it's likely that more gaming time and revenue will to mobile platforms, and that's not to ignore the potential of mobile-related technology like wearables and VR.

But my larger point remains: the rise of mobile gaming is the byproduct of dramatic shifts in technology usage that weren't linked to gaming.

Change will continue - and there's no guarantee that those changes will lead to mobile gaming being more prosperous for those who make mobile games.