Cashing in on Free-to-Play Games

Coinciding with the rise of smartphone games, the video game industry has witnessed a trend towards games that are free-to-play and at the same time not really free. Games like Fortnite, Pokémon Go or Candy Crush can be downloaded and played for free but charge players for additional content or features that really make the game worthwhile.

Based on the notion that smartphone users wouldn’t be willing to spend a lot of money upfront on casual games, the idea of making them free to access and only charge players once they're hooked quickly caught on, and today most major game studios apply the so-called freemium model when it comes to mobile or online games.

And it’s working: according to SuperData, a Nielsen subsidiary specializing in digital games, free-to-play games generated $87.1 billion in revenue worldwide last year, accounting for 80 percent of digital games revenues (incl. premium console and PC games distributed digitally). As the following chart shows, mobile games account for the lion’s share of free-to-play revenues, followed by PC games and console games, where the freemium model is not very common.