Southeast Asia is the world’s fastest growing games market and there is evidence that with the growth of smartphone use in the region it is a mobile-first market. In fact, over two-thirds of gaming revenue comes from mobile gaming in Southeast Asia (SEA) as per Newzoo.
In the Greater South East Asia (GSEA) region revenue from mobile games was expected to easily exceed $2 billion in 2018. The combined value of the PC, online, and mobile games, market is expected to rise from $4.6 billion in 2019 to $7.5 billion in 2022. The number of gamers at this point is expected to exceed 300 million.
Potential for further fast growth
It’s worth noting that the gaming market in SEA only forms 3.1% of the total games market in 2019. However, it’s the massive growth, at 22% between 2018 and 2019, that identifies the potential of this region. Currently only around 48% of the area’s population has access to the internet but as mobile devices become more attainable this figure is expected to rise rapidly, fuelling the growth in mobile gaming.
Newzoo’s insights into SEA indicate local game publishers like Sea Group, formerly Garena, are performing well but publishers from China are permeating the market. These include Tencent, Moonton and NetEase, all doing well from battle royale style titles like PUBG. The only Western publisher to be making headway in the region is Activision Blizzard with titles like King’s Candy Crush and Call of Duty.
The future of mobile gaming across Asia
IQPC’s Mobile Gaming Asia Summit is approaching in February, in Singapore. It has recently analysed the future of mobile gaming across Asia in a publication titled “Tech, Inclusivity and Diversity,” with insights from Pixonic’s Head of Game Design Eugene Sudak.
Sudak believes that mobile gamers are becoming more sophisticated in their needs, therefore so too are mobile games. Better devices are becoming more readily available offering improved graphics and performance.
The advent of 5G in the region will allow more game genres to enter the mobile market and Google’s cloud gaming service and the Apple Arcade, available on mobile devices, opens up new gaming potential too. Sudak says:
“These technologies mean that more developers will turn towards non-payment options in their games, as they will be paid by the publishers based on play time. We will have more games focused not on micro transactions but player engagement.”
He also believes the growth of independent app stores and game publishers will add competition to the market and result in a greater revenue share to mobile game developers.
Pixonic is developing new platform integrations and social functionality for games to encourage longer play time and improve “players’ quality of life.” It’s also optimising its games for more Android devices like Huawei and Meizu brands which are popular in Asia.
Sudak says for mobile game developers to “future-proof” themselves and be successful in the Asian market diversity is key. He adds:
“When you assess the global market and enter a different region, you need to improve your cultural knowledge in addition to understanding better what the players want.”
Pixonic is planning a number of releases in the coming months but haven’t revealed too many details, only that one will be focused on Asia’s gaming market. Sudak says Pixonic is “working to make sure every game works equally” in different markets and on different devices.
IQPC says mobile gaming across Asia, not just SEA, is a $12 billion market annually. It adds that with “rising gamer expectations and the promise of portability and on-the-go entertainment, the cost of launching games in untapped markets is higher than before.” And, that publishers can struggle to gain market share if they have lower brand recognition in the region. In some countries, it says, there are inaccessible payment structures.
IQPC makes no mention of the potential of blockchain technology but next year’s Mobile Gaming Asia Summit will cover game monetization, so the topic is ever likely to arise. Sudak said that cloud gaming platforms may change game monetization models away from microtransactions. However, the emergence of blockchain-based platforms, adding the potential of tokenization to assets and microtransactions, may refresh these models with entirely new ideas.
Cryptocurrency and blockchain technologies offer new ways for game publishers to monetize games as well as benefits for gamers and they may well disrupt micropayments models. There are blockchain startups developing blockchain-based game platforms and studios, like Ultra and Mythical Games, which may eventually compete with the likes of Stadia and Apple Arcade. And, some of the world’s largest game publishers are taking serious interest in this emerging technology. Ultra has just entered into a significant working partnership with Ubisoft.
Image courtesy of Razer