Damn Stinking Apes – Lookout For The Small Game Developers

Our industry is clearly moving to freemium – sales of virtual goods on social networking sites, online worlds, and casual games were $9B in 2011(1) growing at 9.2% CAGR with Facebook and App Stores as the main distribution channel.

Social casual games (bubble, match 3 and casino) represent more than 50 percent of Facebook’s MAUs, and attract more players than the next 10 genres combined. Casual games like bubble, match 3 and casino are also gaining traction on mobile when free verses paid. But even with all these free games, only 25 percent of all of Facebook’s monthly active users play games on the site, according to an IHS Screen Digest report.

We also know that nearly half of all Facebook users log on through a mobile device including tablets, yet mobile versions of social games are still maturing and discovering these apps remain highly fragmented for consumers.

As an industry and as a games business, we need evolve in order to expand market share, and market position. But we also need to recognize that while games are a necessary endeavor to get a bigger slice of the current market, it doesn’t necessary grow the market overall. We need to make strategic investments in new ideas and innovations, create valuable partnerships that build stable and profitable businesses, and foster new economies that can attract and retain more social gamers.

Smaller game companies who are nimble and tenacious have a far better advantage to lead this industry evolution, and master social gaming experiences across multiple screens by 2015. Even Zynga’s CEO Mark Pincus predicted that in the next five to 10 years small developer that creates a breakthrough game has a real chance for a game to spread virally and leverage all of the traffic already produced by the mobile gaming industry, which in turns move the whole industry forward.

So it’s on us – the monkeys of the game industry.