Report: Social virtual goods via mobile to reach $4.6B in 2016
Juniper Research announced the findings in a new report today. The research firm said that the increased use of social gaming, due in large part to the rise in smartphone adoption, will push the global market for virtual goods bought from mobile social media services from $3 billion this year to $4.6 billion by 2016.
Even with that increase, Juniper said the "stranglehold" that app stores have on payments could curtail growth for virtual goods. According to Juniper, app stores take a 30-percent cut of revenue. This is on top of the fee collected by third-party developers that can sometimes be as high as 70 percent.
"Mobile social media services have a serious monetization problem," said Charlotte Miller, the report's author.
"Virtual goods is one solution that has worked well in Japan and China, where consumers already have an enormous appetite for content such as clothing for avatars," Miller said. She added, "The only question is: can they successfully avoid the app stores taking a slice of virtual goods revenues?"
According to the report, sales of virtual goods through mobile social media services are doing well in Japan and China. The report says social gaming familiarizes consumers with virtual goods and predicts the trend to quickly become global, aided in part by the growth of tablet usage.
Other key findings from the report include:
- Nearly half of advertising in social media will be targeted at tablets by 2016.
- The Far East and China will see the largest share of mobile social media revenues with North America following
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