What We Can Learn From King’s IPO Filing

Game Apps

Game Apps

In case you haven’t heard, King, the maker of popular mobile game Candy Crush Saga, has filed for an IPO (Initial Public Offering) in the United States. Reports have now come in that King made over $1.8 billion in revenue in 2013, which is much higher than industry analysts predicted. King is now the second mobile game developer to generate $1 billion in revenue, after Japanese company Gung-Ho (Puzzles & Dragons). What does this success mean for the gaming industry as a whole?

Traditional Gaming

The success of Candy Crush Saga and other mobile games has completely disrupted the gaming industry as a whole.

Firstly, games like Candy Crush are free to download. Compare that to traditional games which are sold in stores at upwards of $60 per game. King’s success is on par with traditional gaming giant Nintendo, which has been at the forefront of the gaming industry for almost two decades. The number of daily active players for King’s mobile games is 17.5 times higher than the number of Playstation 4s sold by Sony.

Gaming has become much less exclusive, with casual gamers destroying the stereotype of a traditional gaming “geek”.

The success of free-to-play games has also forced game studios (big business and independent alike) to up their game, so to speak, on the mobile platform. Intricate, complex games with detailed, in-depth graphics have carved out their niche in the app stores.

Too Big, Too Soon?

One thing to note is that the revenue for all top mobile game makers is actually slowing down. Over the Christmas holiday, King’s revenue was actually less than it was the month before, even though Christmas is a big season for app developers. Supercell’s (Clash of Clans) revenue growth also slowed significantly in 2013. What could be the reason behind this?

First, the mobile game industry is notoriously fickle. Remember Farmville and Angry Birds? These games were once played by nearly everyone, but have now dropped off their user base significantly. The trouble for mobile game developers is keeping users interested for the long term, even after the “next big thing” has come along.

Second, competition is growing. More big-name companies (think Disney) are starting to get into the mobile game mix, taking with them their already built-in user base. Also, as mentioned before, game studios are churning out complex and well-designed mobile games, luring more hardcore gamers away from simpler puzzle games like Candy Crush.

One thing is for sure: the mobile game industry is here to stay. We’re excited to see what the future holds for studios like King and for all other independent mobile game developers!

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