Mobile Now Makes Up Majority Of Gaming Sales And Nintendo's New President Wants To Get The Company On Board

from the choo-choo dept

With the advent of the smartphone, these mini-computers that most of us carry around in our pockets, it was only a matter of time before the mobile platform became a dominant player in the gaming business. That said, it will likely still surprise some folks to learn that this will be the year that mobile takes over gaming revenue, with a forecasted majority of all revenue being spent on mobile games.

Newzoo's 2018 Global Games Market Forecast now predicts that mobile games will make up a slim majority (51 percent) of all worldwide gaming revenue this year (including smartphones and tablets, but not dedicated gaming handhelds). That's up from 34 percent in 2015 and just 18 percent in 2012. Console and PC games will split the remainder of the pie relatively evenly in 2018, at 25 percent and 24 percent of worldwide spending, respectively.

The growth of the mobile market doesn't show any signs of stopping, either: by 2021, Newzoo estimates that 59 percent of all gaming spending will go to mobile platforms, with console and PC games dividing up the scraps.

It's been quite interesting to watch gamemakers themselves react to this brand new market over the past five or so years. Indie developers sprung up everywhere, taking advantage of the new platform for revenue, while established game studios and companies embraced mobile in a more mixed fashion. Some studios, such as Bethesda and Square, began dipping their toes in the water fairly early, only to ramp up releases of past and new titles fully optimized for a mobile experience. What should have been immediately apparent is how perfect mobile devices are for any gamemaker's back-catalog, where games that require less graphical power can be offered to satisfy a nostalgia movement that is essentially a market in and of itself.

Nintendo, on the other hand, balked at the mobile marketplace as recently as a few years ago. Nintendo has long favored a walled-garden approach to its games, exerting strict control over both game titles and the hardware that runs them. It was only in 2015, in fact, when Nintendo, then headed by company president Satoru Iwata, followed by Tatsumi Kimishima after Iwata's death, struck a partnership with a mobile developer to begin releasing Nintendo games for mobile. By any measure, the made Nintendo late to the party, with only a tepid public embrace of mobile gaming as a revenue generator.

Well, Nintendo has a new president now, and Shuntaro Furukawa is looking to get the company fully invested in mobile gaming.

Furukawa is taking over from Tatsumi Kimishima, who took the helm temporarily after the tragic and sudden death of the beloved Satoru Iwata in 2015. He’s only 46, and clearly as a member of the younger generation has a different outlook on mobile, which the company completely avoided until very recently.

“The idea that something will emerge that transforms into something big, in the same manner as game consoles, is the defining motive of the Nintendo business,” he told the Nikkei. “From what I can see, smartphone games are the ones I want to expand the most.”

He said he envisions the smartphone side of the game company to become a 100 billion yen business — short of a billion at the present exchange rate, but why not round up? The company did a trillion yen in sales last year, so it’s not like we’re going to run out of zeroes.

While we could spend time kicking at Nintendo for getting into this so late, the more interesting take on this is that it's a signal that mobile game revenue might actually be undervalued by forecasts. After all, if the market forces are so great so as to drag a company like Nintendo along for the ride, it seems likely that gaming on mobile devices is going to be the gaming market of the present, never mind the future.


Reader Comments

The First Word

Frankly, I'm shocked that you're not alarmed by this.

If mobile were collecting the majority of its revenue from selling questionable quality ports of classic games, this would be exciting news.

Unfortunately, that's not the case.

The majority of mobile revenue, as best I can tell, comes from exploiting a hole in peoples' logic circuits. I'm talkign about gacha, loot boxes, and smurfberries.

The sad truth is that, from my own experience, it is easier for my brain to justify dropping $30 on a free-to-play mobile game for its limited time promotional premium currency pack than it is to justify shelling out $20 for a full-featured critically acclaimed indie game on PC.

There's no logic to it, and I've seriously considered self-inflicted corporal punishment o convince my brain that no, the bushel basket of smurfberries is NOT a better investment than Cuphead. But you can guess which of the two I've probably bought recently.

So yes, the idea of a utopian mobile gaming future where you can buy 30-year-old classics for pennies and make everyone happy is a beautiful one indeed. But what I see when I hear that mobile gmaing revenues have eclipsed all other gaming is a dark dystopian future where we labor in the smurfberry mines under the cruel watchful eye of Papa Smurf. But the real horror is that we willingly labor there, in the hopes that we pull the ultra rare gacha smurf hat with a jingle bell tied onto it.

That's not what gaming should be, but that's where it looks like it's headed.

—Anonymous Coward

Subscribe: RSS

View by: Time | Thread


  • identicon
    Anonymous Coward, 7 May 2018 @ 9:54pm

    X therefore Y.....

    After all, if the market forces are so great so as to drag a company like Nintendo along for the ride, it seems likely that gaming on mobile devices is going to be the gaming market of the present, never mind the future.

    Seems like a severe logical fallacy here doesn't it?

    "Mobile gaming" is a cash grab. It suffers from the same issues as the "replace my PC" idea. Insufficient power reserves when under load, lack of storage capacity, data caps, and poor input methods / ergonomics are just some of those issues. They just don't have the power needed to do the job.

    Nevermind the target demographic: People wasting what little time they have between microwave sessions, and checking facebook. These are not the kinds of people that are going to play an 80+ hour RPG, or pull an all nighter playing Call of Duty and the like. These people are also not going to invest into required hardware addons, controllers, extra batteries, etc, to make the expereince more enjoyable due to the little amount of time they put into each session. The best these people will do is pay to unlock a timer or to get a useless hat DLC. Sure you can make money that way, but it's diminishing returns once the game hits it's peak, and you have no real brand loyalty.

    Then there's the huge company that Nintendo is, and the massive amount of restructuring and layoffs that would be needed for such a model to become their primary business model. I.e. No need for a hardware team if the goal is to reuse existing devices. No need for real writers if the most time someone will spend with the game is about an hour or so before moving on to the next game. The average cost for a mobile game is $10.00 or less, so no real need for expensive investments like graphic artists, and orchestras.

    If anything, Nintendo is trying to grab some fast money while the getting is good. While that's in their right as a company, if they really wanted to make some money, they should get on that Pokemon MMORPG that everyone has been asking for, for decades. Or better yet, get a real VR solution in place and put the Pokemon MMORPG on that, or maybe a Metroid Prime game.

    reply to this | link to this | view in chronology ]

    • identicon
      Anonymous Coward, 7 May 2018 @ 10:33pm

      Re: X therefore Y.....

      Nah, they're too busy trying to scrape all Pokemon MMORPGs others have thought to make for themselves. Like Pokemon Brick Bronze...

      reply to this | link to this | view in chronology ]

    • icon
      PaulT (profile), 8 May 2018 @ 1:08am

      Re: X therefore Y.....

      "They just don't have the power needed to do the job."

      Define "the job".

      You seem to be referring to AAA console games. There's a huge number of other ways to game, and Nintendo traditionally skew well toward to more casual / younger types of gamer. A phone is far more suited to a Harvest Moon than a CoD, for sure, but guess which one Nintendo traditionally makes and which it traditionally avoids?

      You also seem to be thinking this will be a zero sum game - i.e. they ditch all console efforts and only do mobile. That's unlikely unless the bottom falls out of the console market completely, I think they're just hedging their bets in case their next hardware iteration is a WiiU rather than a Switch in terms of sales.

      "These are not the kinds of people that are going to play an 80+ hour RPG, or pull an all nighter playing Call of Duty and the like"

      Nor are people who typically game on Nintendo systems.

      "These people are also not going to invest into required hardware addons, controllers, extra batteries, etc"

      Why do you feel these are necessary for gaming?

      "The average cost for a mobile game is $10.00 or less, so no real need for expensive investments like graphic artists, and orchestra"

      If you're defining the end cost of the product before you decide on the creative requirements of the game itself, you're not going to be making a good game.

      "if they really wanted to make some money, they should get on that Pokemon MMORPG that everyone has been asking for"

      If Nintendo have one area where they're extraordinarily weak, it's online gaming. They can't get a decent way to link players who know each other in real life yet, they might struggle with a true MMO. They need to get the fundamentals sorted before they try copying Blizzard.

      reply to this | link to this | view in chronology ]

      • identicon
        Anonymous Coward, 8 May 2018 @ 2:47am

        Re: Re: X therefore Y.....

        You are aware Nintendo's big franchise has been online for 10 years now? Pokemon already has some features that make it more multiplayer friendly than even WoW (looking at you server migration fees). It really wouldn't take much, I wonder how big Pokemon go could have been if it actually had a game underneath.

        reply to this | link to this | view in chronology ]

    • identicon
      Inspector Clouseau, 8 May 2018 @ 7:06am

      Re: X therefore Y.....

      Your condescending tone is familiar.

      reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 8 May 2018 @ 4:11am

    Frankly, I'm shocked that you're not alarmed by this.

    If mobile were collecting the majority of its revenue from selling questionable quality ports of classic games, this would be exciting news.

    Unfortunately, that's not the case.

    The majority of mobile revenue, as best I can tell, comes from exploiting a hole in peoples' logic circuits. I'm talkign about gacha, loot boxes, and smurfberries.

    The sad truth is that, from my own experience, it is easier for my brain to justify dropping $30 on a free-to-play mobile game for its limited time promotional premium currency pack than it is to justify shelling out $20 for a full-featured critically acclaimed indie game on PC.

    There's no logic to it, and I've seriously considered self-inflicted corporal punishment o convince my brain that no, the bushel basket of smurfberries is NOT a better investment than Cuphead. But you can guess which of the two I've probably bought recently.

    So yes, the idea of a utopian mobile gaming future where you can buy 30-year-old classics for pennies and make everyone happy is a beautiful one indeed. But what I see when I hear that mobile gmaing revenues have eclipsed all other gaming is a dark dystopian future where we labor in the smurfberry mines under the cruel watchful eye of Papa Smurf. But the real horror is that we willingly labor there, in the hopes that we pull the ultra rare gacha smurf hat with a jingle bell tied onto it.

    That's not what gaming should be, but that's where it looks like it's headed.

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 8 May 2018 @ 5:25am

    To stay profitable, you must diversify. NEVER put all of your eggs in 1 basket.

    At one time Nintendo was the Ferrari of the video game market; now they're more like the Mini Cooper. Nintendo's main strength is their IP--I hope they know this.

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 8 May 2018 @ 6:09am

    Vulkan or bust

    Since it will probably take some time before they figure it all out, by then more Android devices will support Vulkan.

    Nintendo should adopt Vulkan because that will open up the possibility to use Vulkan on their next-gen console, and Vulkan will make it much easier to port their games from mobile to that console and vice-versa.

    reply to this | link to this | view in chronology ]

  • icon
    Ninja (profile), 8 May 2018 @ 7:06am

    Based on some past efforts I can't say I expect much from Nintendo. They have fantastic means to make shitloads of money but a corporate mindset that works against themselves.

    reply to this | link to this | view in chronology ]

  • icon
    NaBUru38 (profile), 8 May 2018 @ 7:24am

    Dear Tim, Nintendo has launched several handheld consoles in the past three decades: the Game Boy in 1989, the Game Boy Color in 1998, the Game Boy Advance in 2001, the Nintendo DS in 2004, and the Nintendo 3DS in 2011, and the New Nintendo 3DS in 2014.

    When the iPohne was launched in 2007, Nintendo had already sold about 200 million units of the Game Boy family of handheld consoles.

    reply to this | link to this | view in chronology ]

  • icon
    Mason Wheeler (profile), 8 May 2018 @ 9:00am

    > he’s only 46, and clearly as a member of the younger generation has a different outlook on mobile

    Wait. 46... the younger generation?

    How old was the last president, for that statement to make any sense?!?

    reply to this | link to this | view in chronology ]

  • identicon
    Anonymous Coward, 8 May 2018 @ 9:51am

    Mini-computers

    A mini-computer is actually quite large. Phones are generally considered micro-computers.

    reply to this | link to this | view in chronology ]

  • identicon
    The_Jerk, 8 May 2018 @ 12:22pm

    See, this bullshit is why I decided retrogaming was where it's at. Fuck Nintendo, fuck Microsoft, fuck Sony, and fuck Sega: give me any console before 2005 and stay the hell away. Whole digital *universe* out there to explore without even getting near smartphones and their garbage.

    Add in emulation and piracy and it's even sweeter.

    reply to this | link to this | view in chronology ]

  • icon
    Candescence (profile), 9 May 2018 @ 7:36am

    They say they will, but they probably won't.

    Nintendo's strategy for mobile so far has basically been smaller, simpler titles that don't really compare to their console offerings, and arguably act as advertisements for their console stuff. I don't see that changing, and rightfully so.

    Here's the thing - gaming on mobile devices is currently a garbage fire. There are good mobile games, sure, but they're a tiny percentage of a deluge of terrible games and games trying to milk as much money out of players as possible. Mobile gamers are downright hostile to the idea of any kind of up-front payment, they've been so conditioned to expect things for free that even extremely cheap expansions result in negative reviews and extreme hostility towards developers, as the developers of Monument Valley learned the hard way. And for your average indie developer, good luck with getting any kind of exposure or revenue when the market is inundated with crap.

    As well, touch-screen controls are dreadful for emulating traditional controls, nor do they provide the flexibility to match the amount of functionality traditional controllers provide. The vast majority of gaming genres are almost unplayable on mobile devices aside from the select few that work fine for touch controls, such as puzzle games, turn-based strategy and visual novels. And the vast majority of mobile gamers have no interest in getting a gamepad add-on for their mobile devices, and will turn up their noses at games that require one. The idea of playing anything that requires more complex controls than an NES game with a touch screen is utter madness - playing most SNES titles without the shoulder buttons is one thing, but the N64 or Gamecube? Absurd.

    There's a reason why the Nintendo Switch is exploding in sales, aside from its exclusive content - it can do everything a regular console and a mobile device can do gaming-wise without compromise, being able to play games on a big screen or on the go.

    As a aspiring game developer, I don't see the point in developing for the mobile market. It's too risky, too inflexible to enable the sort of games I want to create, and its audience is toxic and demands everything for free (only to get sucked into free-to-play microtranscation scams).

    To me, despite the ridiculous amount of money going into it, mobile devices are still a novelty when it comes to gaming, not a serious platform for it. You may disagree, but that's how I feel. And that's not going to change without making some fundamental changes to both hardware and the ecosystem which likely won't happen in a long time.

    reply to this | link to this | view in chronology ]


Add Your Comment

Have a Techdirt Account? Sign in now. Want one? Register here
Get Techdirt’s Daily Email
Use markdown for basic formatting. HTML is no longer supported.
  Save me a cookie
Follow Techdirt
Techdirt Gear
Show Now: Takedown
Advertisement
Report this ad  |  Hide Techdirt ads
Essential Reading
Techdirt Deals
Report this ad  |  Hide Techdirt ads
Techdirt Insider Chat
Advertisement
Report this ad  |  Hide Techdirt ads
Recent Stories
Advertisement
Report this ad  |  Hide Techdirt ads

Close

Email This

This feature is only available to registered users. Register or sign in to use it.