New estimates predict mobile phone games will generate US $272 billion by 2030 – up from US $98 billion in 2020 – spurred on by advances in phone and network technology.

Research by GlobalData forecasts the mobile segment of the global gaming industry will grow at a compound annualised rate of 11%, helped along by the roll-out of 5G networks.

These more advanced networks have the potential to offer significantly faster download speeds, with many US providers targeting 20 gigabytes per second.

Importantly, 5G networks are also expected to reduce latency (meaning mobile networks will be more responsive). 

Latency has been a significant and ongoing problem for video game streaming services, and the roll-out of faster and more responsive networks is expected to rectify these issues and support further growth in the mobile gaming market.

GlobalData also expects the growing maturity of cloud gaming services and mobile eSports (the fast-growing world of organised competitive video game competitions) will also support the segment’s growth in the next decade.

Global Data Associate Project Manager for Thematic Research, Rupantar Guha, said we are on the cusp of a new wave of gaming innovation.

“5G networks allow games to be downloaded faster than current 4G networks and aid the development of mobile-based cloud gaming services and augmented reality (AR) games,” he said.

“With the ability to support one million devices within a single square kilometer, 5G will drive more users towards mobile gaming, especially multiplayer titles. This, in turn, will boost the growth of mobile esports, he further added.”

Tech upgrades attract major developers

GlobalData’s report also noted advances in the technology used to manufacture phones is also improving, with new processors and better quality display technologies making mobile phones “more game ready than before”.

Major game developers are taking notice, Mr Guha said, commenting that Activision Blizzard (which owns the Call of Duty franchise and online multiplayer game World of Warcraft) and EA (known for the FIFA and Mass Effect franchises) are both taking a growing interest in the segment.

Meanwhile, social media and advertising companies are also looking to expand into the space, perhaps most notably Netflix.

The video streaming giant recently appointed former Facebook vice president Mike Verdu to spearhead its foray into the world of gaming, hoping to offer video games as a new media category on Netflix’s platform.

Offering video games is part of the company’s plan to keep growing in the increasingly crowded streaming market. 

Playside (ASX:PLY) is an independent Australian game developer positioned to potentially benefit from this growing market. With an impressive track record in the past year, including licenses to produce mobile games based on The Godfather and the Legally Blonde franchise, PlaySide plans to capitalise further on casual mobile game titles through 2021 and beyond. If you would like to stay up to date on their company news and be invited to upcoming investor briefings, please sign up here.

Reach Markets have been engaged by PLY to assist with private investor management.

Sources:

• Global Data: Mobile gaming will become a $272bn industry by 2030, says GlobalData
• Games Industry: Mobile gaming industry to be worth $272bn by 2030 – GlobalData
• PC Mag: What Is 5G?
• Forbes: Why Game Streaming Needs 5G
• Kotaku: Activision Blizzard Merger Finalized
• IGN: FIFA 22 Release Date, Cover Star, and Gameplay Trailer Revealed
• EA: Mass effect
• Bloomberg: Netflix Plans to Offer Video Games in Push Beyond Films, TV