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Mobile game revenue barely ahead of paid installs, but Japan is kicking the world’s butt

Eric Johnson
Friday, 21 Feb 2014 | 10:59 AM ET
Attendees play video games on Nintendo Co. 3DS handheld game players in the GungHo Online Entertainment Inc. booth at the Tokyo Game Show 2013 at Makuhari Messe in Chiba, Japan, Sept. 19, 2013.
Kiyoshi Ota | Bloomberg | Getty Images
Attendees play video games on Nintendo Co. 3DS handheld game players in the GungHo Online Entertainment Inc. booth at the Tokyo Game Show 2013 at Makuhari Messe in Chiba, Japan, Sept. 19, 2013.

The average cost of acquiring a new mobile game user — formally called Cost Per Install, or CPI — is still below the average revenue companies get out of those users, according to a recent Distimo survey of the Chartboost network in Q4 2013.

In the West, it's a narrow (sometimes very narrow) margin, with $2.52 in revenue versus $2.17 per install in the U.S., $2.73 versus $2.42 in Canada and $2.33 versus $1.86 in the U.K. In other words, games in those countries are making between 31 cents and 47 cents per user, on average, from a combination of paid downloads and/or in-app purchases, the dominant business model of mobile games.

But in the East, it's a totally different story.

See how much money mobile gamers are making for companies in Japan, and other countries, at Re/code, here.

By Eric Johnson, Re/code.net.

CNBC's parent NBC Universal is an investor in Re/code's parent Revere Digital, and the companies have a content-sharing arrangement.

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