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Will Sony’s Smartphone Games Be a Key Revenue Driver?

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A fast-growing market

Last week, Japan’s (EWJ) Sony Corporation (SNE) announced that it will start making smartphone games for Apple’s (AAPL) iPhone as well as for Android (GOOG) phones. This means Sony is diversifying its gaming business by expanding beyond its PlayStation business.

Will Sony's Smartphone Games Be a Key Revenue Driver?

According to analysts, smartphone users in Asia enjoy playing “mobile” games, especially in the spare moments they get while commuting, and Sony is looking to tap into the potential revenues in this market. A few months back, rival company Nintendo (NTDOY) also announced its intention to enter the smartphone gaming segment.

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Revenues from Japan reach $6.2 billion

As shown in the above chart, mobile gaming revenues from Japan reached $6.2 billion in 2015. The figure stood at $4.2 billion in 2014, which was more than the $3.3 billion from the console video game market.

Sony has stated that it will be launching mobile games in Japan first and then in other Asian countries. Sony’s Computer Entertainment, the business unit in charge of the company’s PlayStation segment, will set up a subsidiary, ForwardWorks. This subsidiary will develop and distribute mobile games.

“We decided to focus on Japan and Asia for this new initiative because the mobile games are especially large in these regions when compared with other markets,” the Sony’s spokesperson said.

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