Gaming sells on cells

By Candice Jones for Accenture
Johannesburg, 21 Jun 2007

It's game on as competitive data prices and the latest Java-enabled phones boost demand for mobile gaming in SA. Local Java application development is also benefiting from this trend.

A high-end mobile game costs around R40-R50 compared to a subscriber's total monthly cellphone spend of around R160. This equates to a game costing about 25% of a subscriber's monthly spend, says Paul Carter-Brown, senior manager of Accenture Communications and High-Tech.

Brian Burns, product operations director of Motorola, says the company has seen similar figures. "Customers download on average two to three games per year, which represents 20% to 25% of their average spend, or around R30 to R60 per year," he says.

Cheaper downloads

Carter-Brown believes SA's competitive data prices have encouraged the growth in the country's mobile gaming revenue. "Specifically for customers using MTN and Vodacom, data prices are now globally very competitive, which has led to increased data access."

Eric Clements, manager of Accenture Communications and High-Tech, says with more competitive data prices offered by major service providers, he expects revenue growth will continue to rise as users become more proficient in mobile data access.

"As people learn more about what content is available and start personalising their phones, they will also look at downloading cellphone games," he says.

Clements says the trend is evident in providers' reaction to the gaming industry. "A service provider has launched a package that includes one high-end game pre-loaded to phones," he says. "When a large operator launches a package in line with current trends, we can definitely expect to see an increase in the market."

Vodacom could not, by the time of publication, provide its gaming revenue figures. However, the company reports a 64% growth in data revenue.

MTN says it did not see the same growth listed by the rest of the gaming data market segment in 2006. However, Lana Strydom, senior manager for portals and interactors at MTN, says: "We are expecting this segment to grow over the next year by at least 5%." She believes this trend will continue through 2008.

Burns says the boom in this market segment has increased SA's Java application development. "We just have to see the number of Mxit downloads to gauge the growth in mobile Java downloads, which has both built familiarity with the technology and driven revenue."

Room to manoeuvre

Carter-Brown says there is still room in SA for mobile gaming growth. "Compared to other data products such as wallpapers and ringtones, most of the top-end games are relatively expensive. Games are also still fairly expensive in the South African market relative to cellphone spend," he says. "And games also depend on the compatibility of the handset."

There is still a large percentage of handsets in SA, directed at the low-end of the market, that do not support Java or WAP access, which are both required for downloading and playing mobile games, says Clements.

However, Burns believes this is changing. "More manufacturers are selling compatible phones to the lower end of the market and prepaid customers are now beginning to have access to Java- and WAP-enabled handsets."

Most prepaid customers are now looking at devices that cost between R700 and R1 400, many of which are Java-enabled, he adds. "Motorola shipped around 1.5 million devices that are Java-enabled and we are expecting a 25% year-on-year increase to this figure," concludes Burns.