A new study by UK-based research firm Juniper predicts that revenues from purchases made within app games, similar to the free-to-play model, are on track to exceed $11 billion annually in five years’ time.
Juniper also forecasts that “in-game purchases will overtake the traditional pay-per-download model as the primary source of monetising mobile games by 2013.”
The firm says Apple’s in-app billing model is showing the way forward for the industry, but that visibility on certain platforms is a problem for developers and publishers. Daniel Ashdown, the author of Juniper’s report, says: “Discoverability can be a ‘chicken and egg’ problem: high downloads lead to prominence, but achieving a high number of downloads is largely dependent on already being prominent. Consequently, a small minority of games achieve very high downloads, whilst the vast majority achieve very small download figures."
The report echoes predictions by Futuresource Consulting last month, which estimated that “apps-based gaming will account for more than 95% of total mobile gaming revenues by 2014”.
Founder of id Software John Carmack recently described the app store as "the model of the future".