Tech Transformers

Mobile game revenue to pass console, PC for first time

Mobile gaming revenues are expected to outstrip the money generated by console and PC games in 2016 for the first time, a new report shows.

Games from tablets and smartphones will generate a total of $36.9 billion in revenues or 37 percent of the total market which is expected to reach $99.6 billion this year, according to research firm Newzoo.

In comparison, PC games will bring in $31.9 billion while console gaming will generate $29 billion in revenues.

The overall games market is seen growing 8.5 percent year-on-year to hit $99.6 billion in 2016 reaching $118.6 billion in 2019 with mobile continuing to increase its overall share of revenues over the next few years.

Mobile gaming has been on the rise over the past few years as smartphone graphics and processors have improved and more sophisticated titles for smaller screens have been developed. The format has attracted casual gamers, those that perhaps played on consoles like Nintendo or web-based games on PCs.

Newzoo's research shows that revenues from casual web games are set to decline 7.5 percent this year. And Nintendo has been on a big push to transition to the smaller screen, working on a mobile version of the hugely popular Pokemon franchise, and planning to launch a number of new games this year.

But by no means is PC and mobile gaming dying. Revenue generated from PC games is expected to rise 2.1 percent this year while console gaming revenue will rise 4.5 percent, according to Newzoo.

E-Sports – a form of entertainment where people watch other people playing games – has been growing rapidly while large muiltiplayer games such as "League of Legends" has kept gamers hooked on the PC.

And console makers are adopting strategies similar to mobile games where they are offering add-ons to existing titles for consumers to download, as well as exclusive content via their online stores. In addition, Sony is rumored to be working on a new version of its PlayStation called the PlayStation NEO.

VR 'marginal'

Virtual reality (VR) has also been a big focus for many technology companies recently. Facebook-owned Oculus has the Rift headset which can plug into PCs while Sony has released its PlayStation VR headset.

Still, it is early days for the format and any revenue generated in the near-term is expected to be minimal.

"Worth noting is that Newzoo expects game software revenues from VR to remain marginal for the near future and to largely substitute other game spending on console, PC and mobile," Newzoo's report said.

"As the uptake of VR hardware plays out, game software revenues will automatically be absorbed into current PC, TV/console and mobile revenues. VR and AR will in the long term change how consumers communicate with each other and interact with content. In the short to medium term, Newzoo expects the lion's share of VR revenues to be generated by hardware sales, spectator content, and live viewing formats."