Juniper: Tablet gamers will spend $3B on in-app purchases in 2016

February 20, 2013 | By Jason Ankeny

Tablet gamers are on pace to spend $3.03 billion on in-app goods like power-ups and virtual currency in 2016, exploding from $301 million in 2012, according to a new Juniper Research forecast.

Juniper credits the expected growth to catalysts including rapid tablet adoption, growing consumer acceptance of premium in-game enhancements and the continued migration away from dedicated portable gaming handheld to connected mobile devices. The firm anticipates subscribers in North America and the Far East/China market will drive the overwhelming majority of in-game purchase revenues on tablets, accounting for more than 86 percent of user spending in 2016.

Juniper anticipates subscribers in North America and the Far East/China market will drive the overwhelming majority of in-game purchase revenues on tablets.

Despite the booming tablet market, Juniper expects smartphones will continue driving greater in-app purchase revenues throughout the forecast period, with in-game smartphone spending generating more than $6 billion in 2016.

Juniper notes that while a growing number of mobile game developers are introducing virtual currency options to monetize their smartphone and tablet titles, only a limited number of consumers are currently opening their wallets to boost their gaming experience. "When we consider that only a small amount of gamers actually make in-game purchases, and those that do typically only spend a few dollars, it becomes apparent that there are a small proportion of consumers spending thousands annually on these virtual currencies, who subsidize the game for everyone else," said report author Siân Rowlands.

The firm adds that free-to-play casino-style games are also beginning to rake in profits from in-app purchases, even though users are not playing for real money. "Games such as Slotomania, Poker by Zynga and Texas Poker were seeing a sharp increase in the number of users buying chips and other in-game items, in some instances spending as much as $100 in one transaction, to allow for a lengthy, uninterrupted gameplay session," Juniper said.

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