The mobile game market has grown rapidly since the 2010s and now accounts for a large percentage of the game market.
However, the market is gradually becoming saturated and, like consumer games, is turning into a red ocean as development costs soar.
Growth is slowing, but the market size remains large
Mobile games, which were once looked down upon as being only light games, have grown to become a major player in the game market in recent years. Although there are some differences depending on the method of calculation, mobile games account for approximately 50% of the total game market. As we know, many game companies from the consumer market are also releasing titles in Japan.
The global mobile game market in 2023 will be 8,791.6 billion yen, 98.6% of the previous year's level. After reaching a record high market size in 2021 during the Corona Disaster, global revenue declined by 9% in 2022, and although the size of revenue declined again in 2023, the decline was smaller than the previous year, and is expected to turn upward again from 2024 onward.
Although it is often assumed that mobile game players are mainly from Asia, such as Japan and China, in fact the U.S. is the largest market, followed by China in second place.
In addition to factors such as the spread of smartphones and the improvement of the network environment, there are other reasons behind the popularity of mobile games since the late 2010s, including the convenience of game developers. This is because, at least until around 2018, smartphone games could be produced on a much lower budget and in a shorter period of time than consumer games.
In the early days of mobile games, there were almost no titles that were as rich as today's games, and many of them had budgets of tens of millions of yen and development periods of only one year. Many of these games were blockbusters, and many of them were able to recoup their development costs in less than a month after their release. This made smartphone games a blue ocean for many game companies and IT companies to enter.
However, the mobile game market is gradually becoming saturated, with an increasing number of new titles released in recent years requiring budgets of 300 million yen and development periods of two years or more. The number of “one-hit wonders” by companies in the IT field, as was the case in the past, has almost disappeared, and among the titles at the top of the sales ranking, those released by domestic companies are increasingly consumer games, manga, anime, and other IP products.
Even so, the No.1 ranked smartphone app still sells about 5 billion yen per month, and the No.100 ranked app sells about 100-200 million yen per month. expenses), it is easy to see how important mobile games are to today's game companies and game market.
The Rise of Chinese Titles
Another major change in recent years is the dominance of game companies from China at the top of the rankings. Moreover, among them are not a few titles such as “Hara-Kami” and “Collapse: Star Rail,” which are clearly influenced by Japanese anime and light novel culture.
These Chinese titles are characterized by the overwhelming volume and quality of their production while incorporating Japanese culture.
On the other hand, there is no doubt that it is becoming increasingly difficult for Japanese game companies to produce hit new mobile game titles.
Although dozens or hundreds of new titles are released every month, there are almost no titles that remain in the top 100 of the sales ranking for several months, and only a few popular titles such as “Uma Musume Pretty Derby” and “Dragon Ball Legends” remain in the top ranking for a long period of time. In addition, there are some games, especially those from the consumer game market, that have been in the top 100 for some time.
Another headache for game companies, especially those from the consumer market, is the tendency for the termination of mobile game services to undermine trust in the company. Titles will end at some point, and most mobile games will be out of service within a year, but this tends to be more noticeable among the more well-known game companies.
As a result, while many companies in the mobile game market in the past operated a mass production system, also known as “prolific production and death,” they have recently begun to limit the number of titles they offer.
In this way, mobile games will gradually move closer to the consumer game market, where only a few companies develop select titles.
The Present and Future of Mobile Games
- The market size expanded with the Corona disaster in 2021, but declined slightly in the following year and the year after. Nevertheless, the market size is still much larger than that of consumer and PC games.
- Development costs and budgets are becoming larger, and more companies are expected to concentrate on developing a small number of titles, with an increase in IP titles as in the case of consumer games.
