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Mobile gaming revenues to exceed US$7 billion in SEA by 2019: Frost & Sullivan

Zafirah Salim | June 25, 2015
By 2019, Frost & Sullivan also believes that smartphone usage will become mainstream in the region.

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The mobile gaming industry in Southeast Asia (SEA) is the fastest growing region globally, and it has reached over US$1 billion in revenues last year, reported Frost & Sullivan.

Following this finding, Frost & Sullivan predicts that the revenues in SEA will surpass US$7 billion by 2019. This means that the industry would have grown at a very healthy compound annual growth rate of 48% from 2015 to 2019.

It added that revenue is still largely attributable to the more mature markets in the region such as Singapore and Malaysia; but Indonesia and Thailand are quickly expanding and the least developed markets - such as Laos, Cambodia and Myanmar - are still in the nascent growth phase.

Some other top mobile gaming trends predicted by the market research company that will shape the industry in 2015 and beyond include:

Smartphone and tablet usage will become mainstream by 2019

The adoption of smartphones and tablets are still driving growth in the market, as many countries in SEA are still primarily feature phone markets. However, this is quickly changing as markets like Thailand are now over 50% smartphone markets; and Indonesia and Vietnam are also rising rapidly.  

The market for tablet gaming is also interesting in SEA. Although tablets represent a small number of devices in the region, they generate a gaming ARPU of 4.2 times that of a smartphone in the region, and hence are an important part of the market. By 2019, Frost & Sullivan believes that smartphone usage will become mainstream in the region.

Android development will become easier in the region

Currently, Android is by far the dominant mobile OS in the region and Frost & Sullivan believes that it will remain its leadership position due to its affordability and the high popularity of Chinese low-end smartphones in developing markets. This however creates a problem for game developers in terms of understanding which version of Android certain games should support.  

For example, only 6% of global Indonesian Google Play users are using Android 2.3, but the number of users in Indonesia is over 25%. It is also disproportionately high in Vietnam, Thailand and other markets. However, Android as a platform is becoming less fragmented and this will eventually become less of a burden for developers.  

Payment is still a major problem in SEA

Payment channels are increasingly becoming the major impediment to revenue growth in the region as smart devices become mainstream. As a region, credit card penetration is extremely low as all countries in the region - excluding Singapore and Malaysia - have credit card penetration of less than 10%. This makes purchasing virtual goods extremely difficult for most gamers in the region.


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