Author: Stephen

Mobile games benefit from freemium model

| March 9, 2013

Mobile Games FreemiumFreemium makes mobile games a booming market

Mobile games have become a very prominant market for the game industry. Games for smartphones and tablets represent a market worth billions of dollars in revenue and this market has begun to attract game developers that had previously been focused exclusively on developing titles for consoles and PCs. Though mobile games generate a massive amount of revenue on a yearly basis, most of these games are entirely free, though boast of a wide variety of in-game transactions. This business model is often referred to as “freemium.”

In-game transactions relatively accepted by gamers

Freemium is a simple concept: Mobile games that are free to obtain and free to play, but provide gamers with the opportunity to purchase in-game items and power-ups that can make the game more enjoyable. This is where the majority of the revenue that is generated by mobile games comes from. The freemium model allows developers to offer services to gamers for a relatively low price and because these prices are so low, consumers tend to participate in in-game transactions on a regular bases.

Freemium opens mobile games to more consumers

Analysts from Index Ventures, a venture capital investment firm, suggest that the freemium model is ideal for the mobile games market. This model allows developers to price-discriminate individual consumers, eliminating the upfront costs that are associated with other business models. A typical console game can cost anywhere from $30 to $60, but most mobile games are offered for free, with additional content being offered for as little as $1. Index Ventures suggests that the freemium model does not exploit consumers, but rather allows for a broader consumer base to participate in mobile games.

Business model not accepted by all gamers

Index Ventures suggests that many consumers are willing to sink money into mobile games in order to gain as much entertainment from these games as possible. The freemium model may be great for developers, but it is not universally accepted among gamers. Many argue that the freemium model encourages developers and publishers to create games that are deliberately restrictive in order to heavily promote in-game transactions.

Apple could revolutionize the market with rumored iWatch

| March 7, 2013

Apple iwatchApple shows strong interest in wearable technology

Rumors concerning Apple’s development of wearable technology reached a fever pitch this week as Bloomberg reports suggest that a watch-like smart device could generate more revenue for the company than its line of iPads and its potential foray into the world of TVs. It is rumored that Apple has been working on a wearable device that speculators call the iWatch. This device is, essentially, a smartphone combined with a wristwatch, and while it may sound very simple, the device could have major implications for the company’s financial future.

Patents point to wearable technology from Apple

Apple has filed 79 patents concerning the development of wearable technologies. Some of these patents pertain specifically to devices worn on the wrist. Apple has shown strong interest in moving smart technology beyond the realm of cell phones and tablets, believing that wearable technologies may be attractive products for future consumers. Apple’s interest in the watch industry is not misplaced, as analysts from Citigroup suggest that the global watch industry will generate more than $60 billion in sales this year.

iWatch may be a promising opportunity

Analysts suggest that the iWatch represents a $6 billion opportunity for Apple. Moreover, the development of such a device could have major implications for the company’s future. When Apple released the iPod, it was considered something entirely new in the realm of consumer electronics. The iWatch may have a similar impact on the sector, returning Apple to the proverbial throne of mobile technology, which was recently taken over by Samsung.

Innovative steps must be taken to compete with Google and Samsung

Apple has not announced any definitive plans concerning the development of a wearable smart device. CEO Tim Cook has alluded to the company positioning itself to compete with both Samsung and Google more aggressively in the near future. The company has plans to take innovative steps in the realm of mobile technology in order to compete in the consumer electronics market, but whether the iWatch is anything more than rumor has yet to be seen.