Is the situation on the market of mobile and social games as cloudless as the representatives of the platforms claim, Igor Klyukin, the leading analyst of Pixonic, analyzes in his article “The Departing Train”.  

Igor KlyukinRecently, Forbes published an article with the advice of Facebook representative Julien Codorgnu, which can encourage particularly impressionable readers to plunge into the “gold-bearing” world of social and mobile game development.

To plunge too fast and deep, without the necessary preparation and evaluation of many underwater boulders. Therefore, I think it is important to voice, in contrast to the article, a few caveats that should be taken into account by non-core investors and independent developers without practical experience in the gaming industry.

The outgoing train, which a Facebook representative suggests jumping into, has long since left the social media station: Julien Codorgnu talks about $450 million paid by the social network to developers over the last quarter, forgetting to mention that Apple paid $1 billion in December 2013 alone, of which at least 80% should have gone to games. GooglePlay platform can also provide a good income to the application, whose earnings have been approaching the Apple Store indicators for the past few years. The advice from the article about cross-platforming is excellent, but more complete information about earnings allows you to choose the priority platform for the game more correctly.

Get your priorities rightIf we talk about the development of games for mobile devices, it is important to realize what the definition of “hit dream business” mentioned by Julien Codorgnu means, used in relation to the mobile games industry.

Many see it as luxurious mansions with a swimming pool and Scrooge McDuck’s vaults stuffed with gold. But, first of all, this definition should tell you that the main jackpot goes to units, and each beautiful success story obscures thousands of stories about wasted investments and time. According to various surveys, from 60% to 80% of developers for mobile devices have not earned anything or have earned little money from a business point of view. 

Those who are used to risk and still intend to “go to this casino” for the chance to hit the jackpot, I want to warn against such a position. The mobile application market has long gone through a stage of crazy growth, when an unknown game could independently be in the field of visibility of a wide range of users. The number of applications uploaded to mobile stores exceeds 1 million, and successful developer companies have to spend hundreds of thousands of dollars a month to promote their games. There is a share of luck, but the market is now such that any luck can no longer replace experience, large budgets or hard and methodical work.

Now it’s not about luckMy mission is not over yet, even if I have already convinced you to abandon the creation of a gaming company to earn hundreds of millions, and you “modestly” agreed to one million dollars from a “cool” runner that you will make in a couple of months with a budget of $ 50,000.

You should know that each installation first of all costs you money spent on advertising, and only then it brings you profit. And now is the time to remember that the average price per user has exceeded $ 1 a few years ago and has not stopped, and a rare game can get even $1 from the installation. 

As a conclusion, I will say the following. The gaming industry attracts thousands of investors and developers for a reason, and the tips in the Forbes article are not empty words, but it is important to understand that this is not a “Field of Miracles” from a fairy tale and not a casino where luck rules. The games industry, despite the entertaining color of its product, is quite a serious business and requires a serious approach. So, study both tips and warnings, but act wisely, and who knows, maybe the next success story will be about you.

From the editorial office: At the Winter Nights 2014 conference for game developers, which will open next week in St. Petersburg, Igor Klyukin will read a report on the payback of projects, tell what metrics make up earnings, and visually analyze what indicators an application should achieve in order to recapture advertising money. Pixonic is a Russian developer and publisher of games for mobile platforms and Mac.

The company is also the developer of the AppMetr analytical platform, which allows you to research and, according to the creators, significantly increase the effectiveness of marketing campaigns, as well as analyze any user actions in the game.