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Zynga CEO says this is the next big catalyst for mobile gaming

Key Points
  • If you're a mobile games fan, you can expect "bigger, better and badder" franchises coming down the line thanks to 5G, according to Frank Gibeau, CEO of Zynga.
  • "When you look at the history of games over the last years, anytime game developers were given [an even bigger] bandwidth, they innovated in ways they didn't expect," Gibeau said.
Frank Gibeau, CEO of Zynga
Source: Zynga

If you're a mobile games fan, you can expect "bigger, better and badder" franchises coming down the line thanks to 5G.

That's according to Frank Gibeau, CEO of Zynga, whose claim to fame resided with its Facebook-based games like "'Farmville" before it transitioned to creating its own mobile gaming services and brands.

Gibeau told CNBC that while there's a number of catalysts that could boost the mobile games industry, 5G sits "at the top of the list." Research firm Newzoo estimated the industry would generate more than $63 billion in revenue for 2018.

"When you look at the history of games over the last years, anytime game developers were given [an even bigger] bandwidth, they innovated in ways they didn't expect," he said.

The 5G race has heated up with the biggest telecom names launching the network in a handful of cities. Verizon recently announced that it would be testing 5G in Chicago and Minneapolis starting April 11, while Sprint has teamed up with Google and Samsung for a May launch.

And while Jennifer Fritzsche, an analyst at Wells Fargo, says that 5G still needs infrastructure and investment before more significant developments can kick in, its potential for gaming is undeniable.

"The big thing to remember with 5G is two words: low latency," she said, referring to the shorter delay in data transfers that 5G networks will reportedly bring. "With gaming especially, you want low latency, that's what 5G promises [which would bring gaming] to a whole new level."

But Fritzsche stresses that the development of 5G networks is very much in its "batting warmup" stages and that the biggest telecom companies are far from a widespread rollout of the service.

Nevertheless, that eventuality has Gibeau predicting a future where thanks to the potential to stream content quickly, mobile gamers can expect higher fidelity games and easier access to product given that more efficient streaming means that players "[are] able to play the game right off the add."

Discussions of the potential of higher connectivity streaming came to a head this past week at the Game Developers Conference, where Google unveiled its Stadia gaming service platform. A number of independent publishers like Rovio, that created the "Angry Birds" franchise, also have their own game streaming services in the works.

This impact on distribution is particularly important to Gibeau, whose own company is constantly looking to expand what it calls its "forever franchises" like "Words with Friends" and "Zynga Poker." Essentially, they are franchises at the core of Zynga's mobile games business whose longevity and growth Gibeau wants to extend even as the company starts building new games based on the popular "Star Wars," "Harry Potter" and "Game of Thrones brands."

"As 5G rolls out, this is a continuous improvement for all parts of the mobile," he said. "[This is especially true with the] global expansion in mobile in emerging markets."

"You're seeing the proliferation of high-performance devices," Gibeau added. "They're opening markets that won't be reached by console and PC games."

Newzoo also estimates that by 2020, mobile games would generate almost 60 percent of the global games industry revenue.