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US digital games market: December 2014

Total spending on digital games in the US reached $1.2B in December, up 11% from the same month last year. Major drivers were mobile and digital console, which grew 17% and 10% in that same period, respectively. Among the digital platforms, mobile and digital console both follow the seasonal pattern of retail publishing most closely, with peak sales during the end of the year. Social gaming, on the other hand, is showing a 10% decline, totaling $184 million in sales compared to $204 million a year earlier.

SuperData Total digital games market US 2014

Digital unit sales jump 10% on PS4 and XOne during holiday season

Aggressive sales of digital games on consoles allowed the category to grow 10 percent compared to December a year earlier. Totaling $110 million in sales, digital unit sales on both the PS4 and XOne jumped as the year came to a close. Compared to November, both platforms sold on average 12 times more units (full game downloads), but obviously did so at a lower than usual price-per-unit. The monthly average transaction value on PS4 dropped from $20 to $11, and from $21 to $7 on the XOne. By comparison, the average transaction value on Steam dropped to $2, down from $8 in November, as a result of this year’s Winter Sale.

Average transaction size on console

Increased spending offsets declining growth in mobile games audience

If you asked Santa, he’d say the mobile games market had been both naughty and nice to publishers this season. During the holidays the overall user base for mobile gaming tends to grow in absolute numbers, but has now started to show early signs of saturation. In December 2014 the monthly active user base in the United States grew 8%, from 264 million to 287 million, compared to the same month a year earlier. A year before that the mobile game audience jumped 20%, up from 218 million in December 2013. The inevitable decline in growth as market penetration for tablets and smartphones climbs forces a shift in strategy among publishers. The goods news is that mobile game spending hit a new record with the average monthly spend across the entire mobile gaming audience reaching $1.41 in December.

King recaptures players with Candy Crush Soda Saga

Since its November launch, which included larger than life installations in London and New York City, King saw Candy Crush Soda Saga, the sequel to its earlier hit, quickly climbing the charts. Today, the title continues to be one of the top five grossing mobile games on Android and iOS and is the second most downloaded game on both app markets. King’s timing could not be more perfect, as its original breakout title Candy Crush Saga has started to lose steam. King currently claims three of the top five grossing apps on mobile and three of the most popular games on Facebook. The company’s success underscores a growing trend among publishers, like SuperCell, that currently dominate the ranks by financing large marketing campaigns, mostly via traditional channels such billboards and television.

4K TVs at CES herald a new wave of smart devices and a new platform for digital games

After a lukewarm reception in 2012 and 2013, Smart TVs are set for a comeback with the Trojan horse we have come to know as the 4K TV. The technology will be built into virtually every new Ultra HD screen and the devices will offer a number of games and apps. Leading the charge is Sony, who is equipping every new Bravia model with Android TV, Google’s new platform for television streaming. The Japanese giant is also teaming up with Samsung to to incorporate PlayStation Now, the console’s game streaming service, into all of Samsung’s Internet connected TVs in the US and Canada. Users with a paid subscription will be able to stream over 200 PlayStation 3 games by simply connecting Sony’s Dualshock controller. Additionally, both Samsung and Yahoo 4K TVs will include Playsino’s Home Bingo, which illustrates the number of possible Android-based apps that could soon enter the living room. At the same time, virtual reality took center stage at this year’s CES, but does not yet look ready for prime time.

Call of Duty Online now in Open Beta in China

After a year of testing in Closed Beta, Activision recently launched the Open Beta for its highly anticipated free-to-play PC shooter together with Tencent. In offering one of its key franchises for free, using a free-to-play monetization scheme, the Western power house aims to gain a foothold in the desirable but tricky Chinese game market. The move follows a larger industry trend as also mobile game companies and console manufacturers have recently made inroads into China. Activision’s ambitious project, which included a promotional trailer with actor Chris Evans (AKA Captain America), hopes to rival popular Asian titles like Crossfire, which grossed $1.15 billion in 2014. Developed by Raven Software and Activision Shanghai, Call of Duty Online is specifically tailored to the Chinese market and includes unique microtransactions like renting in-game items. The content itself, a collage of the best elements from Black Ops and Modern Warfare, has also been carefully localized, swapping Zombies for more culturally relevant Cyborgs. If successful, the developer will likely adopt the strategy to enter other markets like Brazil, where consoles have been difficult to promote.