The Price Tag of Impatience, Stress and Release: An Exploration of the Revenue Model of Mobile Gaming Companies

Abstract

The mobile gaming industry is growing at a rapid pace. Smartphones, tablets and other mobile devices are new channels to deliver games to customers. However, since the birth of Internet, users are accustomed to get things for free. How then mobile game companies are able to make billions € in revenue? What are the main drivers of profitability in this sector? Our objective is to dissect the freemium pricing strategy that is frequently used in the mobile gaming sector. With the help of the case study of Gameloft, we explore the method and the path for converting free into profit by playing with the users’ frustration and stress.