China is poised to surpass the U.S. as the world’s largest mobile gaming market in 2016, according to an industry white paper released this week.
The 2015 Global Mobile Games Whitebook, published by the Beijing-based Global Mobile Game Confederation (GMGC), market research firm Newzoo, and data firm TalkingData on Friday, predicted that China's mobile game revenues will reach $7.7 billion next year, compared to $7.3 billion of the U.S.
"The fastest growth in mobile games is happening in China and the surrounding Southeast Asian market," said Peter Warman, co-founder and CEO of Newzoo.
The growth is driven in part by an increase of Chinese smartphone users as well as a rise in the number of paying gamers as China becomes more affluent, the GMGC said.
2014 saw a total of 383 million mobile gamers in China, compared to just 183 million in the U.S., with each gamer averaging 35 minutes on gaming apps. This is expected to rise to 475 million and 157 million, respectively, in the next three years, according to the report.
Worldwide revenue from mobile gaming is expected to reach $30.1 billion by 2015, the report said. It also predicted that by 2017, global mobile game revenues will hit $40.4 billion. In comparison, global box-office revenues are projected to be $44.5 billion in that same year, according to PricewaterhouseCoopers.
"China's just growing so fast that I expect that China itself will be larger than our U.S. revenues," Kevin Chou, chief executive of California-based game developer Kabam, said in an interview earlier this month.
Kabam, which developed the recent mobile hit Marvel Contest of Champions, a mobile fighting game based on the highly popular Marvel comic book franchise, is releasing its first Chinese title by the end of this year.
"Asia's just an incredibly important part of our growth strategy, about 60 percent of our revenue today is from the U.S. market and 40 percent of our revenue is from European markets and Asia is nothing for us today," said Chou.
In Aug. 2014, Chinese e-commerce firm Alibaba Group Holdings invested $120 million in Kabam, which opened a development center in Beijing in 2009.
According to data from Newzoo, Web and mobile giant Tencent, which owns a majority stake in League of Legends developer Riot Games, was the leading gaming company by revenue in 2014. The second highest-ranking company was NetEase, which posted revenues of $597 million in the final quarter of 2014.