Triggering the emergence of digital ecosystems: the role of mobile and video games in emerging economies
| Date | 13 August 2018 |
| DOI | https://doi.org/10.1108/DPRG-03-2018-0008 |
| Pages | 449-478 |
| Published date | 13 August 2018 |
| Author | Jean Paul Simon |
| Subject Matter | Information & knowledge management,Information management & governance,Information policy |
Triggering the emergence of digital
ecosystems: the role of mobile and
video games in emerging economies
Jean Paul Simon
Abstract
Purpose –This paper aims to shedsome light on the role of video games withinthe media industry and
IT sector, on its contributionto the production and distributionof digital content in emerging economies. It
offers a case study on the role of mobile devices as a factor of transformation and shows how under
changing socio–economic conditions, the transformations enabled the creation of digital ecosystems
and innovativebusiness models.
Design/methodology/approach –The paperis based on desk research, a review of literatureand trade
press andcomments from experts and industryplayers.
Findings –The paper arguesthat as the internet is going mobile, driven by data –mostly video–the new
mobile platformsare becoming the key for the distributionof content and mobile games.Whether it is the
history of browser gamesin China, mobile games in India or PC games in Russia, each national gaming
industry has required a uniquestrategy for making money, building on some prominent cultural factors
and adaptingto the local economic conditions. The paper reveals that videogames are now clearly a vital
part of digitalcontent production in these countries,while stressing upon the role of public policies.
Research limitations/implications –The paper relies mostly on industry and consultancy data,as in
such a fast-changingenvironment official data even when accessibleare in most cases too old to remain
relevant to identify the trends and the fastchanging stakes. This calls for some caution about the data.
Therefore, the data used should be treated as just signals of potential trends, sufficient to provide an
appropriateoverview of the evolution of the globalmobile ecosystem.
Practical implications –This paper showsthat the video games industry can serve as a pivot for the ICT
industry. Besides, this prompts upstreamand downstream industries of the entire digital entertainment
marketto thrive.
Social implications –The paper shows that companiesfrom emerging markets companies have been
betting on a combinationof factors: the development of the economies, the growth of the mobilemarket,
emergingmiddle-classes and young customers. It providesa growth model that appears to be close to a
‘‘regular’’industrial growth model.
Originality/value –Although there is a growing academic literature on the video games industry, few
research have been devoted to specific issues of emerging economies and to the roleof video games
withinthe media industry and IT sector.
Keywords China, India, Mass media, Developing countries, Public policy,
Mobile communications systems
Paper type Research paper
Over the last 40 years, the video games industry has grown steadily, increasing its
audiences worldwide, widening its demographics and adding access platforms along the
way (video consoles, portable consoles, portals, mobile handsets, etc.). Indeed, the video
games market has been growing, not only in value but also in its audiences. Now, gaming
itself is beginning to be seen as a mainstream source of entertainment for families.
According to Newzoo (2018), the worldwide games market will reach $113.3bn by 2018.
Jean Paul Simon is Director
at JPS Public Policy
Consulting.
Received 2 March 2018
Revised 19 May 2018
Accepted 29 May 2018
Checking and editing of the text
by Jackie Wildau is gratefully
acknowledged.
DOI 10.1108/DPRG-03-2018-0008 VOL. 20 NO. 5 2018, pp. 449-478, ©Emerald Publishing Limited, ISSN 2398-5038 jDIGITAL POLICY, REGULATION AND GOVERNANCE jPAGE 449
This sector has become as importantfor the production of content (especially digital) as the
movie industry.
Since 2004, the online and wireless video games market has grown with remarkable
rapidity, driven by the increase in the number of broadband subscribers, the innovation in
available games, the transition to handheld devices and the newest generation consoles.
Now smartphones are a popular gaming platform. Smartphones provide the engine for
growth. Since 2013, particularly large increases have occurred in several populous
countries, including China, Indiaand Russia (Pew Internet, 2016).
Smartphones and the mobile internet saw the advent of applications for the consumer. App
stores have changed the value chain of software (distribution and pricing). Games are the
number one app by downloads or revenues (iOS and Google Play). In 2016, games
generated 75 and 90 per cent of all app store revenue through the iOS App Store and
Google Play, respectively (AppAnnie, 2017a, p. 10). Games are expected to continue
generating the bulk of app revenue accordingto AppAnnie (2017b).
Mobile gaming is indeed gaining strong traction in China, India and Russia. China and
India are also the fastest growing mobile (data) markets in the world. As a result, Asia has
been witnessing considerable changes in its games market and has introduced some
business model innovation for example “freemium” games, now the dominant model in
the world.
Although there is a growing academic literature on the video games industry (Benghozi
and Chantepie, 2017;De Prato et al, 2014a,2014b;Juul, 2012;Kerr,2006, 2017;
Zackariasson and Wilson, 2012;Wi, 2009), little research[1] has been devoted to specific
issues of emerging economies, neither to the role of video games within the media
industry and IT sector, nor to its contributions to the production and distribution of digital
content. These would include the role of video games within the media industry and IT
sector, to its and the industry’s contribution to the production and its distribution of digital
content. This paper attempts to shed some light on these issues by defining the
backdrop for their development, stressing their shared features and highlighting their
differences, which are mostly owing to cultural factors. It offers a case study on the role of
mobile devices as a factor of transformation. It shows how, under changing
socio–economic conditions, the transformations enabled the creation of digital
ecosystems and innovative business models.
The first section of the paper accounts for the changes in the IT landscape and the role of
the third mobile wave (internet mobile). It stresses the main common features of the growth
of these markets in the three countries (i.e. dramatic growth of the mobile market, fast
growing economies, emerging middle-classes and young customers). The next three
sections offer a case study of each country. These sections open with an introduction to the
state of the ICT industries and then move to a presentation of the video games markets
(market structure, players, type of games). The paper concludes with the specific
combination of parameters that characterizes each market and account for its growth.It will
particularly focus on the role of local content (localization and vernacular) and that of public
policies. It ends with a quick review of cases from three other countries: Brazil, Iran and
Turkey.
This paper is based on desk research, a review of literature and trade press and on
comments from experts and industry players. However, the paper relies mostly on industry
and consultancy data given that in such a fast-changing environment, official data, even
when accessible, is, in most cases, too old to remainrelevant for identifying trends and fast-
changing stakes. This calls forsome caution about the data. The data used here should be
treated simply as signals of potential trends. Nevertheless, it is deemedsufficient to give an
appropriate overview of the evolutionof the global mobile ecosystem.
PAGE 450 jDIGITAL POLICY, REGULATION AND GOVERNANCE jVOL. 20 NO. 5 2018
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