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Why It's Scary When 0.15% Mobile Gamers Bring In 50% Of The Revenue
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Why It's Scary When 0.15% Mobile Gamers Bring In 50% Of The Revenue

Mar 1 2014, 8:00pm CST | by

There’s a new report out from Swrve which says 0.15% of mobile players account for 50% of mobile games revenue. The general idea isn’t exactly groundbreaking news, but those specific numbers seem...

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26 weeks ago

Why It's Scary When 0.15% Mobile Gamers Bring In 50% Of The Revenue

Mar 1 2014, 8:00pm CST | by

There’s a new report out from Swrve which says 0.15% of mobile players account for 50% of mobile games revenue. The general idea isn’t exactly groundbreaking news, but those specific numbers seem even more imbalanced than previously thought.

The existence of “whales” in mobile gaming has been a staple of the industry for a while now. It’s a term salesmen use for huge clients or casinos use for big spenders. But I think it’s worth taking a look at the possible moral and ethical issues behind these elusive sea creatures in the mobile space.

While the whales of the business world are millionaire or billionaire fat cats, that’s usually not the case in the mobile scene. Rather, the types of people who spend thousands of dollars on free to play mobile games are generally not Arab sheiks or titans of industry. They’re normal people with addictive personalities, and some mobile games have created a new sort of addicting environment that hasn’t really been seen before.

It’s a weird hybrid of gambling addiction and more traditional video game addiction, neither of which is anything new, but the combination of the two is a relatively novel emerging phenomenon, and one all the mobile games giants are taking advantage of to full effect.

While traditional game addiction hoovers up a player’s time, there’s usually something of a limit on the amount of money that can be sunk into a game. A Call of Duty or Skyrim addict may pour thousands of hours into a title, but relatively little cash past the initial $60 investment and a bit of merchandise. A game like League of Legends can be a huge time and money suck due to plenty of in-game microtranscations, but the sorts of things you can buy (character skins) aren’t crucial to success in the game.

Enter mobile/casual titles. They’re free to play to get players hooked, but then nearly all of the content in the game can be bought with real world cash. As a secondary source of income, games like these will put up artificial time blocks that players can pay to skip.

Both of these systems directly go after addicts. They don’t care about their time necessarily, but they sure as hell want their money. And with time blocks as a core mechanic of the game, the only way a player can invest more time is to invest more money. While it’s possible in games like Zynga’s Farmville or Supercell’s Clash of Clans to get a big farm or castle eventually, the leaderboards heavily favor those who spend real life money, and lots of it. A player who spends $5 for the resources to built a guard tower and $5 to skip the lengthy build time will have a distinct advantage over someone who waited a few days rather than a few seconds to get the same item.

This isn’t gambling, not really. The result isn’t random; you get what you pay for. But the symptoms of addiction and the behavior of the addict is the same. “Just $5″ turns into $20 then $100 then $5,000 in the worst cases. While like gambling, everyone has the right to do whatever they want with their money, addiction is very real, and it effects people who don’t have that sort of money to spend more than the rich simply looking to have a bit of fun.

If 0.15% of players are responsibly for 50% of mobile revenue, that equates to a lot of regular people spending serious cash on these games. The people I hear most often spending themselves into oblivion after getting hopelessly addicting to these games are bored middle-aged women and depressed college kids. Is there anything owed to people like this? Or can they simply do what they want?

They can, of course. I’m not suggesting that games where it’s possible to spend $5,000 a month on virtual goods shouldn’t exist, any more than I’d say Las Vegas should shut down or prohibition should be reinstated.

But I don’t think this is a problem with much of a support system to help combat it. Gambling addiction is as old as time, but many of its lessons wouldn’t quite cross over to this virtual realm. Video game addiction is on the rise, but this is a variant that can not only bankrupt someone’s social life, but their bank accounts as well.

There should be more education, more help available for people like these. While casinos advise us to seek help for gambling problems and beer commercials tell us to drive responsibly, so far all these mobile games companies do is bathe in the money of these super whales, and the fact that heavy, hurtful addiction plays a significant role in this 0.15%/50% revenue ratio is rarely discussed. Perhaps it should be.

Follow me on Twitter, subscribe to my Forbes feed, and pick up a copy of my sci-fi novel, The Last Exodus, and its sequel, The Exiled Earthborn.

Source: Forbes Business

 
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2

4 days ago

Khazanah throws MAS RM6b lifeline

Aug 29 2014 5:01pm CDT | Source: Business Times Singapore

August 30, 2014 1:15 AMKHAZANAH Nasional will inject RM6 billion (SS$2.4 billion) over three years to resuscitate loss-making Malaysia Airlines (MAS) under a recovery plan that includes even an Act of Parliament. Other key moves are migrating its operations, assets and liabilities to a new company (NewCo) and slashing the wo ...
Source: Business Times Singapore   Full article at: Business Times Singapore
 

 
Update
1

5 days ago

MAS posts loss of RM307m for Q2

Aug 28 2014 5:00pm CDT | Source: Business Times Singapore

August 29, 2014 1:13 AMMALAYSIA Airlines (MAS) registered a loss of RM307 million (S$122 million) for the second quarter to end-June, but warned of worse to come in the second half when the "full financial impact of the doubl ...
Source: Business Times Singapore   Full article at: Business Times Singapore
 

 

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