I’ve been asked this a bunch of times in the previous months when opening up the subject of this blog and my career as a mobile Game Designer. For some people, the fact that most games are free on mobile is the norm. It should be this way, I shouldn’t have to pay money for a “silly” game. For others, who grew up gaming on other platforms, the fact that mobile games are free is unsettling. So let’s talk about it. Why are mobile games free?
Your Answer Upfront:
Mobile games are free because the market for mobile games is huge. There are billions of mobile gamers out there. It’s much easier to get hundreds of thousands of gamers to install your game if there’s no price to pay for it. Game developers monetize their games with ads and in-app purchases, ensuring that every single download generates at least a small amount of revenue for them.
In this article we’re going to take a look at the mobile gaming industry and a bit of it’s history. After that, we’ll explain why exactly mobile games are overwhelmingly free to play and why the rest of the industry is bound to follow. By the end of this article you’ll have a pretty good idea why mobile games are free.
Before the launch of the iPhone, most smartphones were running a much, much simpler operating system with a button/key driven interface. The screens were small to accommodate the keyboard for inputs and the processing power of the early smartphones was nothing compared to their modern day counterparts.
The games themselves were nothing to write home about, although, in my opinion, we got some of the best retro and limited gaming experiences out of that era of mobile gaming. I actually talked a bit about pre-smartphone gaming in my article titled “Is Mobile Gaming The Future?” where I explained where mobile gaming comes from and where it’s going.
But, for all intents and purposes, what you need to remember is that most mobile phones back in the day had a screen resolution the size of a high res icon on your iPhone or Android device. I’m not joking. The most common resolution was 240 x 320 while a modern iOS Icon size for an app can reach and even topple that size.
Now here’s a fun fact for you: most games for mobile phones even back then were free-ish. Most of them came preinstalled on the phones and their cost were subsidized by the phone’s cost. Buying a new game for your phone was tough because phones had different hardware and ran different operating systems customized for the hardware itself.
How We Used to Get Old Mobile Games
So, if you had to buy a mobile game, you would have to make sure that:
- The game supports your phone
- The game is approved by the carrier
- The game supports your phone and carrier and configuration
- the same phone was released with different variations between carriers and had different versions of the OS on it.
You could purchase a game that works on your phone but not with your carrier and that was actually a thing. I spend many nights trying to play Elder Scrolls Travels on my phone, purchasing various versions and trying to get it to work to no avail. Back then I could send an SMS to a number that would authorize the payment and the SMS needed to include:
- Game Name
- Game Version
- Phone specific version
- Carrier specific version
Get a letter wrong? You would pay for the wrong game or the wrong version and there was no way to get your money back.
In short, it was horrible and hard to purchase and get mobile games on your phone back in the days. Things got better with consoles and Gameloft rose to greatness by offering a streamlined way of purchasing Java games from them. Here’s a screenshot of Gameloft’s Java games website from back in the day:
It’s safe to say that it wasn’t as easy as the one-tap install process we have nowadays. But why was it important that you know this? Well, take a look at it this way:
The amount of people who had phones capable of playing games was small. According to statista there were 3.3 billion people who owned and used a mobile phone back in 2007. However the amount of people who owned a phone that could play modern games like Gameloft used to make? More or less 3%, is a quote I kept hearing around that time from devs on TigSource Forums. So that’s about 100 million possible gamers.
Out of the 100 million smart-ish phone users how many do you think were actively playing games? And from those gamers how many do you think were capable and technical enough to jump through the hoops to get a new game installed on their phone?
The mobile gaming market was small. And with a small niche, a select niche, comes the ability for increased pricing and pricing in general. But nowadays? In 2022 there are 6.4 billion modern smartphone users.
Gaming on Modern Phones
The thing with modern smartphones is that everyone and their grandma has one. They are ubiquitous with our every day lives. This means that, even if 3% of all smartphone owners are gamers (the same percentage as before) the actual number has basically doubled.
And the hardships of installing a game have been removed. To get a new game on your smartphone nowadays all you have to do is open the app store and click GET or Download. That’s it.
So let’s say we ended up with double the market size of the pre-smartphone mobile gaming era (in reality about 50% of smartphone owners play games on their phones, aka 3 billion people). And we removed the barrier to entry. That means a ton more people can play games on their phones.
Which means a bigger audience that results in more products released on the marketing. And with more products, comes more competition and lower prices. And a bigger market means happy advertisers.
Think about it this way: Let’s say you made a smartphone game in 2007 and your audience is 100 people. And you’re selling the game for $5. With a 3% conversion rate (aka 3% of your target audience purchase your game after becoming aware of it) you would end up with 3 customers and $15 in your pocket.
But remove the price from the equation. You increase your conversion rate to 25% by having the price set to $0. However you choose to display ads in your game and every ad displayed brings you about $0.10. You show 5 ads in a single gaming session and people play your game for a week with 3 sessions per day.
You show the game to 100 people and 25 of them purchase your game. Let’s do a quick, simple, math exercise on the previous numbers.
- (5 ads/session) * (3 sessions/day) * (7 days of game time) * ($0.10/ad) * (25 people) = $262.5
Let’s say the ad rates are even worse and you only make $0.01/ad displayed. You end up with $26.25 which is still more than the initial $15 you’d get for your premium game.
Same game, same market size with a zero upfront cost and driven by ads. And you make a ~$11 more. Or $247 more. Scale up that number from 100 people to let’s say, 500.000 people.
And I’m not even talking about the rampant piracy that used to be the norm with premium games before. By making them free and supported by adverts or in-app purchases you basically outplay the pirate services. And why risk pirating a game when you can get it for free?
Why are mobile games free?
Mobile games are free because the market for mobile games is huge. There are billions of mobile gamers out there. It’s much easier to get hundreds of thousands of gamers to install your game if there’s no price to pay for it. Game Developers monetize their games with ads and in-app purchases, ensuring that every single download generates at least a small amount of revenue for them.
Where To Next?
I write extensively about the mobile gaming industry, their tactics and how greed influences a game’s design, subjects which were brought up in this post.
I believe that you might be interested in more articles on game monetization. So if you want to stick around, you can check out “How Do Free Mobile Games Make money“, “Why Do Mobile Games Have Fake Ads” and “Why Do Mobile Games Have In-App Purchases“.
If you’re wondering “Why Games Run Better On iOS” I have you covered with an article that explains this in great detail!
There’s also a monster post (about 4000 words) that answers the question: “How Hard Is It To Make A Mobile Game“. It goes in depth with actual examples on how Experience, Resources and Financials affect the difficulty of developing and releasing new mobile games!
If you like our content and want to stay up-to-date, you can subscribe via the mailing list widget on this page! Or give us a follow on twitter. Is there something else you’d want covered on our Best Smartphone Games blog? Let us know in a comment below.