The global Gaming market is expected to grow by 15.4 per cent to $116.43 billion in 2022, soaring from $101.21 billion the year prior, according to the newly released “Mobile Gaming Global Market Report 2022” by the Business Research Company. In the next few years, the market is projected to accelerate its compound annual growth rate (CAGR) to 15.77 percent and reach a size of $209.12 billion in 2026.

The report defines the Mobile Gaming Market as consisting of sales of gaming services and games designed and played on mobile devices including smartphones, feature phones, smartwatches, tablets, pocket PCs, personal digital assistants (PDAs), and other similar devices. However, the vast majority of mobile games are played on Android and iOS smartphones, which offer high processing power, advanced graphics engines, growing levels of RAM, and sharp high-definition displays.

Technological advancements such as the integration of Virtual Reality (VR) and Augmented Reality (AR) which offer more immersive gaming experiences are also gaining popularity and driving the growth of the mobile gaming market.

The continued growth of the mobile gaming market continues fuelled by the rising smartphone penetration caused by expanding mobile data accessibility and the growing capabilities of mobile devices, alongside increasing demand for communication and social media services, rising incomes, social status and other factors.

In the US, smartphone penetration grew from 35 per cent in 2011 to 81 per cent in 2019, according to data by nonpartisan think tank the Pew Research Center, with devices becoming some of the most ubiquitous technological devices. Western European and Australasian countries have followed a similar path, but there remains significant capacity for growth in the developing world, with only around 60 per cent of the Chinese population and under half of the Indian population currently owning smartphones according to NewZoo’s recent Global Games Marketing Report. However, despite the lower market penetration, the size of the userbase means that the Asia-Pacific region is already the largest in terms of mobile gaming revenues.

Market growth necessitates the creation of consumer-protection regulations

Many mobile games are free to play or are paid for as simple single purchases or ongoing subscriptions. Nonetheless, over the last few years games developers have moved towards monetising games by selling in-app purchases and “loot boxes”.

In-app purchases offer games developers a way to monetise their most committed fans by offering them upgrades such as special characters, weapons or outfits, add-ons which they can continue to create without needing to develop and market a whole new game.

However, loot boxes pose a more difficult question, as they offer players the chance to buy a mystery box of upgrades, which many have equated to gambling, and are regularly included in games marketed towards younger players. Whilst there are plenty of ways to gamble on mobile devices, with various casinos offering ways to play online baccarat, poker, and other games, the difference with loot boxes is that it is less clear that they are also a form of gambling but regulations around the world have yet to catch up.

Some countries, such as Belgium, have banned loot boxes from games sold within their territory, but with the global nature of the internet such blanket bans may not be the most successful route to solve the issue. Instead, consumer regulations and gambling licensing could be broadened to include loot boxes and similar in-game functionality.

Those that are looking to gamble online know that they should look for a website or app to be licensed by a gambling authority such as the UK’s Gambling Commission or Malta Gaming Authority to know that the game is fair and the gambling firms offer some form of protections against problem gambling. Games with loot boxes, however, are generally not covered by any such authorities, leaving them in a regulatory grey area.

As the mobile gaming market matures, national and international bodies need to act to protect the public from the issues associated rising popularity of playing roulette online for real money and other gambling titles. Strict licensing regimes controlled by dedicated national or state gaming authorities provide a means to effectively monitor and supervise the mobile gaming sector and to allow the participation only of market players that regularly pass the test and bear the stamp of approval.

Licensing procedures are usually lengthy and thorough and designed to ensure reliability. Scrutiny is given not only to business plans, site policies, and funding origins, but also to game certificates, random number generator (RNG) and return-to-player (RTP) algorithms, among other aspects. The substantial fees can also serve the dual purpose of guaranteeing the licensee takes the regulations seriously and can help with public health campaigns to help those that do end up struggling with gambling-associated problems.

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