'Freemium' Mobile Gamers Spend An Average of $14 Per Transaction

By Tracey E. Schelmetic July 28, 2011

Have you ever played a “freemium” game on your Apple iPhone or Android-based smart phone? You know...one of those games that is initially free to play, but if you want to actually progress through the game’s levels, you need to buy things: tokens, weapons or Smurfberries, depending on your age and gaming preferences.

While it may sound a bit daft to those who don’t play, it turns out the average “freemium” mobile phone gamer splashes out about $14 per transaction on these games. That’s a lot of dough for the game developers and the mobile marketplaces, who take a cut of consumers’ in-game purchases.

Jeferson Valaderes of the blog Flurry writes that these “retail portable games” are seriously challenging more established gaming platforms like Nintendo DS and Sony PSP. (Something that appears to be irritating the pants off Nintendo CEO Satoru Iwata, who has referred to smartphone games as “worthless” and accused the mobile games app industry of “boring consumers.”)

Iwata’s protests aside, Flurry has measured that iOS’s and Android’s revenue share of the U.S. portable game software category rose to 34 percent in 2010: up from just one percent in 2008.

And it would appear that mobile gamers prefer the “freemium” model rather than paying for apps and playing for free within them. Flurry, pulling data from 75,000 apps and 3.5 million smartphone owners, discovered that fully 65 percent of mobile gaming revenue can be attributed to freemium games, while only 35 percent comes from gaming apps that users pay to download.

So who are these people paying an average of $14 per transaction inside a video game on their phone? Probably the guy sitting next to you on the train into work. But even more shocking is that five percent of people who make in-game purchases inside freemium games spend more than $50 per transaction.

That’s a lot of virtual body armor.

Want to learn more about the latest in communications and technology? Then be sure to attend ITEXPO West 2011, taking place Sept. 13-15, 2011, in Austin, Texas. ITEXPO offers an educational program to help corporate decision makers select the right IP-based voice, video, fax and unified communications solutions to improve their operations. It's also where service providers learn how to profitably roll out the services their subscribers are clamoring for – and where resellers can learn about new growth opportunities. To register, click here.

Tracey Schelmetic is a contributing editor for TechZone360. To read more of Tracey's articles, please visit her columnist page.

Edited by Jennifer Russell

TechZone360 Contributor

Related Articles

Why Blockchain Could Be a Gamechanger

By: Paula Bernier    1/22/2018

Blockchain has become closely associated with the controversial topic of cryptocurrency. And that's fine because blockchain is an enabling technology …

Read More

Consumer Privacy in the Digital Era: Three Trends to Watch

By: Special Guest    1/18/2018

Digital advertising has exploded in recent years, with the latest eMarketer data forecasting $83 billion in revenue this year and continued growth on …

Read More

CES 2018: Terabit Fiber - Closer Than We Think

By: Doug Mohney    1/17/2018

One of the biggest challenges for 5G and last mile 10 Gig deployments is not raw data speeds, but middle mile and core networks. The wireless industry…

Read More

10 Benefits of Drone-Based Asset Inspections

By: Frank Segarra    1/15/2018

Although a new and emerging technology, (which is still evolving), in early 2018, most companies are not aware of the possible benefits they can achie…

Read More

VR Could Change Entertainment Forever

By: Special Guest    1/11/2018

VR could change everything from how we play video games to how we interact with our friends and family. VR has the power to change how we consume all …

Read More