Technology-Headlines

by George Heymann

Social virtual goods revenues generated via mobile devices to reach $3b in 2011 rising to $4.6 billion in 2016

by Anna Schmidt

Technology Market

A new report from Juniper Research finds that soaring usage of social gaming – driven largely by the sharp rise in smartphone adoption – will push the global market for virtual goods bought from mobile social media services from $3 billion this year to $4.6 billion by 2016.

The report found that sales of virtual goods via mobile social media services are flourishing in Japan and China; as social gaming familiarizes consumers with virtual goods, this trend will quickly become global. Increasing tablet usage is also expected to provide further momentum as these devices offer a significantly better user experience for social gaming than smartphones.

Revenue share pitfalls

One potential roadblock for virtual goods is the stranglehold app stores have on payments. Any services wishing to sell virtual goods from within their app risk losing 30% of the payment value to the app store. For virtual goods sold via social gaming this is doubly worrying, as these games are typically developed by third parties which receive around 70% of in-game spend. App stores such as Apple App Store, Google Market and BlackBerry World require that the developer surrenders 30% of in-game purchase revenue.

According to report author Charlotte Miller, ‘Mobile social media services have a serious monetization problem. Virtual goods is one solution that has worked well in Japan and China, where consumers already have an enormous appetite for content such as clothing for avatars. The question is can they successfully avoid the app stores taking a slice of virtual goods revenues?

Other key findings from the report include:

  • Spending on advertising targeted at tablets is expected to account for almost half of total mobile social media advertising spend by 2016.
  • On a regional basis, Far East & China will continue to account for the lion’s share of mobile social media revenues, followed by North America.
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Filed under: General technology, Media, Services, Software, Uncategorized, , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , , ,

2 Responses

  1. PN says:

    Consumer goods reviews are also helpful when you are comparing different products and trying to decide on the right one to buy. You can easily compare whatever products you may be looking for and see what has been rated better by the people who have tried the products.

  2. Marketing Forum says:

    Additionally, forums, like other popular social media platforms, are another means for people to interact with each other on a more personal level about a specific topic.

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