Asia takes to mobile gaming

Published in: Latest Intelligence

Mobile gaming has been revolutionizing the gaming market.  A report released by Juniper Research states that the mobile gaming businesses are set to reach $100 billion by 2017 overtaking its position as a complementary revenue source to a primary source.

According to Frank Schuengel, Mobile Channel Member & Product Development Manager for Asian facing operator 188BET, while the market is booming across Europe, Asia will play catch up for a while yet.
“I doubt any Asian players do the percentage of action on mobile that, for example, Paddy Power does (50%+ of all bets now taken on mobile) but everyone's mobile action is growing and we will catch up and overtake any European players eventually,” he said.

This boom can be attributed to the growth of smartphones and access to data while on the move. With companies such as Apple and Samsung creating devices where gambling can be done any time and any place at the customer’s convenience it has become the preferred method of gaming.

In the Philippines, there are approximately 70 million mobile phones, which is a bigger market than computers.

Jacques LeDisco, a mobile gaming analyst said Androids and tablets are the most popular devices in Asia. According to Umeng, China's leading mobile app analytics firm, there are over 500 million Android OS devices in the country. This number is expected to grow to over 800 million in 2014.

However while the smartphone market is rapidly growing, the main challenge in Asia is the fragmentation of devices. “On one hand you have your iOS devices and on the other hand a myriad of Androids from dozens of manufacturers. So either you have users with premium devices, or users with cheap devices, and both expect their phone or tablet to work perfectly with any mobile game. Apple is still strong in the premium segment, while Android will eventually win due to pure numbers,” said Schuengel.

“Asia in general is growing. China has become the largest smartphone market in the world recently and boasts over 1 billion mobile subscribers, but 3G numbers are still not on the same level. Growth is depending on availability of devices (especially cheaper ones) and good networks. It takes a while until the whole area sports fast enough networks to fully use smartphone gaming sites,” he added.

According to the report Marketing for and on mobile - new tactics and best practices, many companies have greatly benefited from the growth of mobile gaming. Paddy Power’s mobile revenue made up 32 percent of its total revenue in 2012, Betfair reported that 50 percent of its new registrations in the third quarter of 2012 came from mobile gaming and in the UK William Hill reported that mobile makes up 35 percent of its online revenues.

According to LeDisco, in Asia, Hong Kong Jockey Club, VODone (Chinese mobile lottery), China Mobile Games & Entertainment Group (CMGE); and PhilWeb (PHWBF) are the leading operators in mobile gaming.

Philweb, the Philippine’s first listed online technology firm is looking to expand into mobile gaming. The company announced that it had set up a P1 billion company to operate mobile lottery games as part of a strategy to expand its revenue.

In Asia, Soccer betting apps, Mahjong, and Pai Gow poker are the most popular gaming apps. According to Umeng, a Chinese app analytics firm formed by Google, Yahoo! and Baidu alumni and recently acquired by Alibaba, the top-grossing Android social games in China can generate between USD$5-USD$10 million per month in third-party revenue share. Umeng serves over 100,000 mobile applications across all major mobile platforms — iOS, Android, and Windows Phone — with more than 50 percent of all Chinese developers using the service.

“Unlike the U.S., where two official stores dominate the iOS and Google Play app distribution networks, China has scores of independent, third-party app stores,” said LeDisco.  

One driver has been the development of social gambling platforms like Jackpot City, which offers a mobile site with all its casino games. Facebook offers an app that allows users to play bingo for real-money rewards and social gaming company Zynga is looking to move from play-for-fun casino games into real money gambling.

According to LeDisco, local users are looking for games created in local languages, adapted to native cultures and gaming preferences. In order to boost their revenue, operators adapt by localizing products.
“Knowing what users are using, and will use, in the various markets in Asia is key and a big headache if you look at how fragmented the mobile market is,” Schuengel added.

While Asia is still behind the more developed markets in Europe, it’s catching up very swiftly and if local mobile operators want a slice of the action, they need to move fast.