Fees for downloading mobile games will disappear, predicts EA
Paying a fee to download a mobile game is "slowly disappearing," says Blake Jorgensen, chief financial officer at gaming firm Electronic Arts.
"The consumer expects to get the game experience on a mobile device for free," Jorgensen is quoted by GameSpot as saying at the Wedbush 2014 Transformational Technologies Management Access Conference in New York.
According to Gartner, free apps account for around 60 percent of Apple's App Store downloads, while they account for 80 percent of Google Play downloads. Instead of charging for downloads, mobile app developers are increasingly turning to in-app purchasing, or IAP, to generate revenue.
"We believe that IAP is a promising and sustainable monetization method because it encourages performance-based purchasing; that is, users only pay when they are happy with the experience, and developers have to work hard to earn the revenue through good design and performance," says Brian Blau, research director at Gartner.
EA's Jorgensen agrees. Consumers "know they can grow that experience over time by monetizing or paying for more, or continuing to play for free," he says.
The firm has seen its mobile gaming business explode, reaching more than 130 million monthly active users and generating a record $460 million in revenue in its most recent fiscal year.
EA mobile games for iOS and Android devices include Monopoly, The Sims, Madden NFL, FIFA by EA Sports and the Simpsons.
"We feel that the install base is a very important number for us because you're essentially creating a network and a group of users that you can keep moving to other games over time. It reduces your cost of acquisition so to speak," Jorgensen concludes.