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Mobile Gaming Trends and Revenue Models

Conference Paper · July 2016

DOI: 10.1007/978-3-319-42007-3_58

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 Mobile Gaming Trends and Revenue Models

Khaled Mohammad Alomari1(&), Tariq Rahim Soomro2,

and Khaled Shaalan3
1
Faculty of Arts and Sciences, Abu Dhabi University, Abu Dhabi, UAE
khaled.alomari@adu.ac.ae
2
Faculty of Computing and Engineering Sciences,
SZABIST Dubai Campus, Dubai, UAE
tariq@szabist.ac.ae
3
Faculty of Engineering and IT, British University in Dubai, Dubai, UAE
khaled.shaalan@buid.ac.ae

Abstract. The study tries to find out the most important features in building
games based on the grossing. The study is limited to fifty iPhone games that
have achieved top grossing in the USA. The game features were extracted from
a previous study [1] and classified through ARM funnel into five groups (“A”,
“R”, “M”, “AR”, and “RM”). The paper follows CRISP-DM approach under
SPSS Modeler through business and data understanding, Data preparation,
model building and evaluation. The researcher uses Decision Tree model since
the features have closed value i.e. (Yes/No) on the grossing weight. The study
reached to the most important 10 features out of 31. These features are important
to build successful mobile games. The study emphasizes on the availability of
(Acquisition, Retention and Monetization) elements on every successful game
and if any is missed, will lead to the failure of the game.

Keywords: Mobile games
Mobile game trends
Mobile games revenue

models

1 Introduction

According to the UN International Telecommunications Union, the of end 2014 there

were 7 billion subscriptions in the world for mobile phone - compared to 2.2 billion in
2005 and 719 million in 2000 [2]. Mobile phones are used extensively for entertain-
ments, communicationsand it became a part of personal accessories. The new trends
and applications developments in the mobile phone open the door for developers to
offer their expertise in the development of better to mobile phone applications [3].
Currently, mobile phones support a wide range of connectivity features like Bluetooth,
NFC, Wi-Fi and Data Mobile. Today, mobile data become more prevalent. According
to the UNInternational Telecommunications Union there 2.3 billion mobile-broadband
subscriptions globally [2] and 352 operators globally. The 4G mobile technology was
launched in December 2009 and until the end of January 2015, more than a third of the
global users were using 4G mobile data [4]. The technology is not going to stop here
and 5G was predicted at 360-europe event held in Brussels last year [5].

© Springer International Publishing Switzerland 2016

H. Fujita et al. (Eds.): IEA/AIE 2016, LNAI 9799, pp. 671–683, 2016.
DOI: 10.1007/978-3-319-42007-3_58
672 K.M. Alomari et al.

As far as games are concerned on mobile devices, “Snake” was the first game
installed on Nokia mobile phone in 1997 – the now-ubiquitous Snake – in one of its
models [6]. As compared to game console and PC games using mobile devices to play
games are quite easier [7, 8]. Today mobile game becomes more important issue in
technical development of Smartphone and/or tablets device [9] and mobile games
become the prime component of the video game industry [6]. Mobile games part is one
of the fastest growing fields in the mobile market [9] and increasing by around 20 %
annually [10].
Mobile Games is not limited to entertainment only, but entered in the fields of
learning and treatment. In the field of Learning and Education, it is observed that
learning potentials for players Games higher than non-players [9]. It is noted in the
literature that serious games can make a positive contribution [11]. Mobile game-based
learning (mGBL) use gameplay to strengthen the motivation to learn, engage in the
acquisition of knowledge and to improve the effectiveness of learning content transfer
and should mix between education and purpose entertainment to make mGBL suc-
cessful [3]. The games promote skills of thinking and planning more than assigned to
content knowledge [12] also promote problem-solving and collaboration [13].
According to [3] it was found that the students preferred mobile phone for learning
rather than other devices. There are several examples in the field of treatment too.
“Lumosity” is a mobile game to brain training based on the latest discoveries in
neuroscience and the goal of this game is to make Human Cognition more rapidly and
efficiently [14]. Another example is, e-Health game “Re-Mission” to improve behav-
ioral outcomes for young patients with cancer in a multisite randomized controlled trial
[15]. There is also SPARX program that uses a platform of a fantasy game to teach
CBT skills for adolescents with depression [16]. According to the Apple app store and
Google play, the popular mobile game markets, the mobile games can be classified into
18 classes [17, 18], as shown in Table 1 below.

Table 1. Mobile game categories [17, 18]

Action Adventure Arcade Board Music
Casino Dice Educational Family Sports
Puzzle Racing Role playing Simulation Strategy
Trivia Word Card

Few years ago, most video games industry moves their development towards
mobile games and today reap billions of dollars. This paper will discuss important
features to build mobile games and will also cover how to build successful game
development environment and will study top grossing games and analyze data through
CRISP-DM approach where this approach plays a big role in building models, utilizing
the logical sequence of construction steps which applied in this study, such as business
and data understanding, Data preparation, model building and evaluation.
This paper is organized as follows; Sect. 2 will discover trends and revenue models
in mobile gaming; Sect. 3 will discuss Materials and methods used in this study;
Sect. 4 will represent analysis and findings; Sect. 5 will conclude this study.
 Mobile Gaming Trends and Revenue Models 673

2 Trends and Revenue in Mobile Gaming

In the year 2014, there were more than 850,000 apps in Apple App Store and 700,000
apps in Google Play store [1]. The statistic shows in Feb 2014 that the game appli-
cations get on 41.2 % of all applications category in Google Play store [19] and it
shows in Sep 2014 that the game applications were the 1st popular category, with a
share of 21.14 % of all applications in Apple app store [20]. The year 2014 has been a
jammy year for the mobile games industry. United States get on the highest earnings
occurred, where games accounted for nearly all revenue of the platform (Leonov 2014).
That mobile games remained the largest segment in terms of revenue, accounting for
around a quarter of the total market [10].
Most games are based on “Free to play” model it is the fastest growing during the
past 15 years [21]. Following are few important models described:
• Free to Play (F2P): These games are free to download and play, but contain micro
transactions [22].
• Pay to play (P2P) or Premium: In these types of models the users required to pay
before playing [1].
• Freemium: These are part of F2P [23], and are based on the combination between
“free” and “Premium”. Freemium become the popular business model for smart-
phone app developers today [24]. In the year 2014, there are 69 % of gross revenue
from IOS and 75 % from Android devices coming from the freemium model.
Freemium is achieving monetization from two ways direct and indirect [1].
– Direct monetization: In-App Purchases (IAP) for example, it sales Virtual
Goods inside games, best example, Hay Day and clash of clan. In the year 2014,
they were able to generate more than 2 million US$ a day from these two titles
[25].
– Indirect monetization: Coming from advertising and the best example is Fruits
Ninja of Half Brick, this game monthly generates 400000 US$ from Ads only.
• Paynium: This model is like a freemium, but the difference is that it requires a
payment on an initial purchase, then playing is completely free [26].
This study focuses on the latest trends of the mobile game market and explores its
revenue model in general and freemium revenue model in particular. Also, what is the
importance of acquisition, retention and monetization for F2P games? Mobile Games
that depend on freemium revenue models are analyzed along with the relationship
between revenue and games features are explained. Other important relationships are
also analyzed, for example, the relationship between revenue, category, developer,
users daily play, users daily install and others, for the future researchers and developers.
Features in this study are extracted from Askelöf’s [27] and Moreira et al. [1] they used
ARM (Acquisition, Retention and Monetization) funnel, as shown in Fig. 1, to chosen
a group of features related to F2P Model. Total 31 features were used in this study.
Figure 5 later in the paper shows the features and classification.
674 K.M. Alomari et al.

Fig. 1. ARM funnel

3 Materials and Methods

Applying the experimental method to extract, transform, and analyze data, the
researchers followed CRISP-DM (Cross Industry Standard Process for Data Mining)
approach to handlingthe problem. Researcher this approach adopted for its success in
providing scientific contributions in a previous study [1] in the same field. Where
presented, what the features are needs to build a successful game.

3.1 Data
Step-1: Researcher extracted data from “thinkgaming” [28]. Apple app store’s Top
50 Grossing iPhone Games were investigated. Out of 50, two paid games were
removed, as study focus on a freemium model; all data inserted in an MS Excel
spreadsheet, with attributes, for example, Game Name, Revenue, New Installs,
Daily Active User, Category and Developer Name for each game to facilitate data
analysis.
Step-2: Researchers create another MS Excel spreadsheet with attributes Game
Name in Columns and game features in rows. Out of 48 further 2 games were
removed because of missing data.
Step-3: After understanding the phases of business and data, data preparation was
initiated to use it in the modeling tool.
 Mobile Gaming Trends and Revenue Models 675

3.2 Transformation
Total 1824 entries collected through two ways. First install top grossing games in
iPhone and extracted 31 features for each game; second extracted other data from
thinkgaming for further analysis. The data was processed and converted in such a way
to the values to fit with statistical operations in new MS Excel spreadsheet. This
prepared data now can use in software, such as Excel, SpSS statistical & SpSS
Modeler, to get the best result.

3.3 Normalization
In order to get the easiest value in the columns (Revenue, New Installs and Daily
Active User) data was normalization to get value between (0,1) by using following
formula:1

ðxi  Minðrange xiÞÞ

value ¼
ðMaxðrange xiÞ  Minðrange xiÞÞ

To measure performance evaluation used ROC Curve test, where this test just accepts
values between (0–1) i.e. Candy Crush Saga revenue is 1005806$ after normalization
Candy Crush Saga revenue the result becomes (0.590196166).

3.4 Model
In this study, three step processes have been used to generate a model. In the first step,
a “Decision Tree” is used to extract knowledge about the problem domain. In the
second step, a “Regression Analysis” used to support the most significance between
variables. Finally, the third step measures “Performance Evaluation” to ensure the
validity of results that get from two previous steps.
Decision Tree. In the finding of this study, a decision tree is the best way for modeling
data, as data contents features have close values i.e. (yes/no) were used to find the
features are available in some particular game or not. The data representation by
decision tree allows advantage compared with other approaches and easy to interpret.
The goal of a data model is to create classification model to predict target attributes
using SpSS modeler software. The value was used in this model was: (label: Game-
Name, values: All Features, weight: Revenue). Figure 2 below depicts the strong
relationship between revenue and the features through decisions tree model was gen-
erated and it was found that there are total 10 features, which are most important among
all 31 features. These 10 features model was generated and find that there is a realistic
choice of features to achieve higher profits, as shown below in Fig. 3.

1
“Xi” is value for each game under columns (Revenue, New Installs and Daily Active User) and
“range Xi” mean all games values in the same columns.
676 K.M. Alomari et al.

Fig. 2. Features through decision tree

Fig. 3. Decision tree rules for 10 Features

Regression Analysis. To extract the relationship between attributes in the database,

linear regression analysis has been used through SpSS statistical software. Before
analysis, two variable dependent and independent variable were chosen. All features
 Mobile Gaming Trends and Revenue Models 677

that got from Decision Tree after applying analysis through revenue attributes were
used as dependent variable and feature factors were used as an independent variable as
shown in Table 2. From Table 2, it is depicted that the statistical value T-Test of
(2.176) at the 0.05 level. This value is statistically significant, which indicates the
existence of a relationship between features factor and revenue.

Table 2. Linear regression between features factor and revenue

Coefficientsa
Model Un-standardized Standardized t Sig.
coefficients coefficients
B Std. error Beta
1 (Constant) −104368.711 130133.878 −.802 0.427
Features.fac 45103.448 20727.667 .305 2.176 0.035
a
Dependent Variable: Revenue

Performance Evaluation. ROC Curve is the fundamental tool for diagnostic test
evaluation. The ROC Curve test was used for this step. ROC Curve is binary classifier
system for illustrates performance. ROC Curve was acceptable if the result is between
1.0 and 0.5 and if it is less than 0.5 is not acceptable. The SpSS statistical software was
used to apply ROC Curve through variable “Revenue” and as a test variable all features
were extracted from Decision Tree, as shown in Fig. 4 below and result of test variable
as shown in Table 3.

Fig. 4. ROC Curve (Color figure online)

678 K.M. Alomari et al.

Table 3. Result of test ROC curve variable

Test result variable (s) Area
Invite friends feature .628
Skill tree .883
Facebook .585
Leaderboard .574
Time skips .872
Request friend help .670
Event offer .745
Customizable .862
Soft currency .606
Unlock content .660

4 Analysis and Findings

This part will discuss the approach to game features and its relationship of revenue with
the category, developers, other features, for example, the number of users’ daily play, a
number of users’ daily install.

4.1 Category
Study finds 14 categories out of 18 categories of 48 top grossing games (as in 2 games
researchers were not able to find all related data), as shown in Table 4:

Table 4. Category-wise
Role Playing

Simulation

Adventure
Strategy
Arcade

Casino

Family
Casual

Action

Sports

Puzzle

racing
Trivia

Total
Card

Category
13

48

Frequency
1

100.0
12.5

14.6

27.1
2.1

2.1

2.1

4.2

4.2

4.2

4.2

6.3

4.2

8.3

4.2

Percent
3281339

1813050

1165649

7799681
224565

172057

165401

175827

233260

131956

218554
83007

37537

32345

65134

Gross $
 Mobile Gaming Trends and Revenue Models 679

As shown in Table 4, the casino games listed the highest 13 games out of 48 top
grossing games in the USA on iPhone devices. This is due to culture and lifestyle. The
casual and strategy games came next at 7 and 6 respectively.

4.2 Developers
Study finds 8 developers out of 31 Developers of 48 top grossing games (as in 2 games
researchers were not able to find all related data), as shown in Table 5:

Table 5. Developers-wise

PLAYTIKA LTD
ELECTRONIC

FUNZIO INC
GAMES INC
ZYNGA INC

SUPERCELL
KING.COM

BIG FISH
ARTS

SGN
Developers

Frequency
5

2
10.4

8.3

8.3

6.3

6.3

4.2

4.2

4.2
Percent
171648

341659

140003

219999

322896

318159

124277

72314
Gross $
7

2
22.0

4.38

1.79

28.2

4.14

4.08

1.59

0.93
1%

1%
%

Percent

As shown in Table 5, King.com had 5 games out of 48 games. The net gross
exceeded $ 1 m and 700 thousand per day. Whereas Supercell had 3 games out of 48
but it reached nearly 2 m and 200 thousand per day. These results were measured on
iPhone devices in the USA.
There are many developers in the field of games. However, a successful game
developer might attract the majority of users if one of their successful games was the
most popular and used among others.

4.3 Features Analysis

Study used 31 features and divided it into five groups, such as “A”, “R”, “M”, “AR”,
and “RM” of ARM Funnel approach (Fig. 1 above) and the results are shown in Fig. 5.
Through review the 10 features, as shown in Table 6 below, which are important to
680 K.M. Alomari et al.

build the successful game with the ARM Funnel Column finding the three elements
(Acquisition, Retention and Monetization) in the F2P games are very important for the
success of the game and a failure to one side leads to the failure of the game, where two
features have classified under acquisition and four features have classified under each
retention and monetization.

Fig. 5. Feature frequency of 48 top grossing mobile game and groups (Color figure online)

Table 6. Ten important features with ARM funnel classification

Nodes Importance ARM funnel
Invite friends feature 0.4356 A01
Skill tree 0.1708 R03
Leaderboard 0.0869 R11
Unlock content 0.0341 R04
Soft currency 0.0341 M10
Facebook 0.0341 R01
Customizable 0.0341 M09
Event offer 0.0341 M06
Request friend help 0.0341 AR01
Time skips 0.0341 M07

4.4 Other Relationships

Study finds other relationships belonging to problem and findings were summaries in
Table 7 using linear regression.
 Mobile Gaming Trends and Revenue Models 681

Table 7. Linear regression between other relationships belonging to problem and findings
Dependent Independent Sig
Unique offer Daily Active User .014
Daily offer Revenue .002
Daily Active User .027
Event offer Revenue .010
Time skips Revenue .011
Timed boost Revenue .018
Soft currency Revenue .019
Daily Active User .001
Chat Daily New Installs .027
Revenue .008
Daily Active User .009
Competitive Revenue .001
Daily Active User .006
Single Revenue .024
Daily Active User .046
Cumulative Revenue .011
Daily Active User .043
Item upgrade Revenue .010
Daily Active User .031
Status upgrade Revenue .020
Daily Active User .135
M.Factor Revenue .001
Daily Active User .008
R.Factor Revenue .004
RM.Factor Revenue .037
SUM.ALL.factor Revenue .000
Daily Active User .014
Developer Daily Active User .049
Daily Active User Revenue .000
Daily New Installs .000
Daily New Installs Revenue .029
Daily Active User .000

Table 7 depicted that the statistical value T-Test at the 0.05 level. This value is
statistically significant, which indicates the existence of a relationship between
Dependent and Independent variables. As far as there are daily active users of the
games, there will surely be revenue and new installations of games, where a regression
linear analysis (Table 7) shows significant equal 0.0 between the elements above. This
proves a strong relationship between them.
682 K.M. Alomari et al.

5 Conclusions

This paper presents the development of previous research regard building a successful
game. The 31 features were extracted from the decision tree. The study found that there
are 10 most important features to build a successful game. The result is useful for future
researchers and developers who want to develop and implement a successful game.
Other features were also analyzed in Table 7 and their significant values were pre-
sented with the relationship among revenue and other features the strongest relation
affecting the revenue was the Daily Active User. So the developer should strengthen
the retention element in building games. It is also believed that the other features will
also play important roles in successful games, such as culture, lifestyle and loyalty to
brand names.

Acknowledgement. Special thanks to ÁtilaValgueiro Malta Moreira who provides some data,
which help this research to be completed (Moreira et al. 2014).

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