Gaming giant Electronic Arts, which has seen years of success on console, PC and handheld, is seeing more and more success in the burgeoning mobile games market. The company released the highly-anticipated driving game Real Racing 3 yesterday and will launch Command and Conquer: Tiberium Alliances soon for mobile.

Nick Earl, senior vice president and general manager of EA’s All Play label, recently spoke with Inside Mobile Apps about EA’s transition to free-to-play, its relationships with the mobile platforms (Apple and Google) and the core gamer market on tablet.

Inside Mobile Apps: What has EA learned so far from some of its freemium titles like The Simpson: Tapped Out and The Sims FreePlay?

Nick Earl, senior vice president and general manager of EA’s All Play label (pictured right): We’ve learned a lot. Top of the list is how open this model is in terms of the number of players and how big the audience can be when a game is free-to-play, even though there are a lot of opportunities if you’re willing to spend money inside these freemium games. Having [games] as this model means it’s completely open and free for millions to play on a daily basis. We’ve learned that we have to be able to support a large audience and that’s the infrastructure of the game. The operations has to be able to support large audiences and we’ve learned that on games like The Simpsons, for example, which now has now more than five million daily active users, and when we started it, we struggled. We rebuilt the infrastructure to support and maintain large audiences.

We’ve learned that the design of a free-to-play game is different from a premium game or console game where you pay upfront and get all you can eat. It requires a different style of design, that’s a core compulsion loop, that the user experience as well as the sinks where the game tends to monetize. You need to construct a game that’s going to work for the majority of people that are not going to pay at all but is still going to make sense for people who have the disposable income and desire to speed up and experience or get access to a premium item, and that doesn’t really upset the balance that exists for the entire community that are playing the game. There’s a real art to creating and designing these games.

IMA: With Real Racing 3 recently releasing, which is a free-to-play game, could you talk about the decision or the process of making the change from Real Racing 2′s premium model to the freemium model?

Earl: From the beginning, we made the decision, both EA and Firemonkeys to go freemium from the beginning for a couple of reasons. One, is that the market was moving and voting for going freemium, even though this it’s not supported by everyone because some people don’t like change. We acknowledge that and understand it. The vast majority like that there is no barrier to download a game and to start enjoying it and be a part of that community and experience. It’s clear to us that the way we we’re going to make this the most accessible and get the audience to appreciate what we believe to be a high-quality experience — free-to-play was the way to go. Secondly, we came up during the course of development with this unique, innovative multiplayer mode called Time-Shifted Multiplayer, which allows you to compete with your friends but do it in an asynchronous manner. Once we came up with that, we realized that this game is going to be more fun if there was a large audience. If there wasn’t a limit of people willing to spend $5 or $7 or $10 dollars on a game. We wanted to open it up and make it free. As we were developing, it was validating the decision to go freemium and that’s why we went all in at that point.

IMA: On the flip side, you still have premium titles in your portfolio on iOS and Android and you’ve seen some success with games that are premuium with a price upfront and in-app purchases as well, like Need for Speed: Most Wanted and FIFA Soccer 13. Is EA still seeing success with premium mobile games?

Earl: We have not made the decision to focus exclusively on premium. There’s a place for premium with in-app purchases — we call that “paymium” to make it more confusing. There’s a place for those games and we’ll continue to evaluate each game by a franchise by franchise or game by game basis to figure out what’s the optimal way to construct a game and construct a business model for that game. The majority of games are going to be freemium going forward unless something radical shifts inside the industry. I don’t see it departing from this model any time soon.

IMA: In EA’s last earnings call, the company mentioned again how much revenue The Simpsons: Tapped Out generated. Distimo recently put out a report, which showed EA at the top spot among all top grossing cross-app store publishers. With mobile development having better margins than console development, will EA be focusing more of its business on the mobile platform?

Earl: We can’t talk about our gross profits and gross margins from system to system, but what I would say is this — we are enormous believers in the mobile platform and we’re excited about the future. If you take a look at the numbers and the trajectory, there’s no argument against how fast these devices are being adopted. We’re seeing unbelievable activation rates on a daily basis. We saw enormous numbers over Christmas. We’re seeing a whole market spring up in front of us. We’re excited about mobile. There are potentially millions of people that will upgrade from feature phones to smartphones and tablets in the years ahead. So there’s just no denying that mobile is enormously exciting to this company. And, our goal is to make the greatest highest quality games we can in front as many people as possible.

With all of that said, the company is invested in the future of consoles, and now that there’s some announcements about the next gen, we’re excited about the possibilities there and we’re also big players in the PC business and have some big franchises like The Sims that make sense for the PC — both online and offline. We’re a large publisher that has the ability and the resources to go after multiple markets and find a way to tie these franchises, so that you can play and interact with them across any device at any time, anywhere. That’s the Holy Grail here — to have the ability to access a given franchise from multiple devices, and your data moves seamlessly across sessions. That’s something EA believes in.

IMA: We recently spoke with the developer working on Command & Conquer: Tiberium Alliances, which will launch on mobile soon, featuring cross-platform play between mobile and PC. Will more EA games feature cross-platform play?

Earl: That’s something we’ll push toward. There’s a lot of intricacies around design. I don’t think you can necessarily stop playing on web and then pick up where you were on mobile, but I do think you can interact with it. I like to use FIFA as a good example of that. On your phone, you can act more like the manager and switch positions — who your players are on the starting eleven and later you can take that new roster and play a new game in all its 3D glory with your 5.1 surround sound on a beautiful HD screen. And then the next time you can open your iPad and look at all the stats that you generated from that game. We love the notion of having your data in the cloud and being able to interact with it no matter where you are and when. (more…)

Editor’s note: The U.S Patents and Trademark Office (USPTO) is hosting a second software patent roundtable on Wednesday in New York City, which aims to give the public an opportunity to share their thoughts on how to improve on software-related patents. Josh Hartwell, CEO of Mobile Deluxe, an independent mobile game publisher from the U.S., discusses below the issue in terms of small business owners’ struggle with patent trolls.

We have an incentive system at work in the apps ecosystem. Angry Birds has been downloaded one billion times, Temple Run more than 150 million. Other developers see the potential for great financial reward with their work, which encourages further development, risk taking and invention. This benefits not only developers but also smartphone owners and our economy.

Ideally our patent system would be humming alongside this app freight train, rewarding original and unique ideas, conferring exclusivity on the truly novel. Unfortunately, it has been doing the opposite in many cases, creating undue burdens on this vibrant sector due to a few bad actors. Developers have grown fearful of receiving letters from patent trolls seeking nominal license fees for seemingly unrelated patents, written long ago in many cases.

Our system facilitates, even encourages, the two business models of patent trolls. Some trolls seek overly broad patents and pursue large tech companies for hefty paydays. Other trolls seek similarly weak patents, but choose thousands of small tech companies as their quarry, seeking seemingly small “license” payments.  With both types the initial math is simple: convince the target company that fighting in court is hundreds of times more expensive than merely licensing the dubious patent, even if you win.

In 2011, for the first time ever, more information technology patent lawsuits were filed by non-practicing entities (NPEs) than by practicing entities. I don’t mean to imply that all NPE’s are bad actors.  To the contrary, they play a vital role in a properly functioning system. However, more NPE’s have turned to trolling, taking the tack of accumulating older technology patents, devising creative and over-broad interpretations of what exactly is covered by the patent, then threatening hundreds or thousands of practicing businesses with lawsuits if the patent is not licensed. The license fees are always nominal when compared to the cost of a federal court defense, which is what makes trolling such an attractive numbers game for these unscrupulous actors.

The U.S. Patent and Trademark Office is in the business of granting patents. As a rule, it lets the courts handle everything else. But with an expensive legal system and the granting of overly broad patents, the current system is simply untenable for the average entrepreneur.

Congress attempted to address the problem in 2011 with the America Invents Act, which gives additional methods for patent invalidation. However, in many troll cases the patents are valid, they simply don’t pertain to the target company’s business. Trolls seek expansive and creative definitions of their patents’ scope, sometimes pretending that new technologies are analogous or equivalent to the old technologies that the patent actually covers.

The first step in the solution is simple. We must offer an alternative to the two current choices: a full-blown federal court defense or caving to the patent trolls’ demand for a license. The oft-proposed small claims court for patent matters needs to be implemented now. It should be set up as a one-defendant court so that trolls can’t sue multiple parties at one time. It should also be set up as a loser-pays court to bring the scales back in balance for the current patent system.

Further, threatened companies should be capable of bringing trolls to court preemptively, for a ruling regarding the scope of patents asserted by trolls against them. Such a system would preserve the rights of bona fide patent holders while discouraging the growing scourge of trolls that threaten to otherwise derail this vibrant and growing sector of our nation’s economy.

Our country’s spirit of entrepreneurship and our technological leadership have given rise to an incredible tech industry, and in particular, a booming apps ecosystem. As an entrepreneur, this has helped me create a vibrant company of more than 25 full and part time employees. Our patent system must work in concert with entrepreneurs, providing further incentives without undue burdens. Living under the threat of being sued for an irrelevant patent is no way to grow a business, or in this case, tens of thousands of businesses. I have immense faith in our entrepreneurs and startups. I am a believer in our intellectual property system, and I believe that we can and must change our patent system such that it is part of this growth engine — not part of the problem.

App tracking company Distimo today released its latest report, dissecting the state of new publishers and apps in the Apple App Store and Google Play.

Before analyzing new publishers and apps, Distimo took a look at the growth of the two app stores. Google Play showed the most growth since August 2012, increasing daily revenues by 107 percent across the 20 biggest countries. In the past six months, the Apple App Store for iPhone and iPad showed less growth compared to Google Play, but daily revenues still grew by 52 percent. Last month, Google Play’s daily revenues increased 17 percent, while the Apple App Store increased by 3 percent. Note that the absolute values on the Apple App Store were already much higher than Google Play’s. Lastly, there’s a combined 1.5 million apps on the Apple App Store and Google Play

The Dutch firm first analyzed the top 250 publishers within the last four months from October 2012 to January 2013 in the U.S., finding that only 2 percent of the top 250 publishers are new on the U.S. Apple App Store for iPhone compared to 3 percent for Google Play in the U.S. Revenue-wise, the new publishers in Google Play accounted for 1.2 percent of total revenue, which includes in-app purchases, for the app store, while new publishers in the Apple App store for iPhone accounted for .25 percent. Some of the top new publishers included Magic Mirror, developer of the ElfYourself by Office Max app on iPhone and iPad, and the makers Snapchat on Android. Among the newcomers in both app stores, Google Play had more new publishers launching apps versus the Apple App Store, with an average of six free apps, while new publishers in the Apple App Store for iPhone published an average of two free apps.

Now when Distimo took an in-depth look into new apps, 17 percent of the top 300 apps in the U.S. Apple App Store for iPhone were new apps, while 12 percent of the apps were new on Google Play in the U.S. The company classified a new app in this report as an app from a publisher that was first seen within the last four months — from October 2012 to January 2013. Despite a larger percentage of new apps among the top 300 apps on the Apple App Store when compared to Google Play, new apps in Google Play gained more revenue than new apps in the Apple App Store. On Google Play in the U.S., 18 percent of total revenue, including in-app purchases, came from new apps, on the flip side, 12 percent of total revenue was generated by new apps in the U.S. Apple App Store for iPhone.

Distimo then looked at the velocity of the new apps in terms of how fast the apps were downloaded and made money. The most downloaded new apps on the Apple App Store worldwide were Temple Run 2, Google Maps and NHN Japan’s puzzler Line Pop. In 24 hours after the app released, all three apps garnered more than one million downloads worldwide. Temple Run 2 from Imangi Studios in particular, raked in 20 million downloads across all platforms in four days and 50 million in two weeks. The U.S. was the country that drove the most downloads to the top 10 new apps.

Distimo also revealed the top new apps to generate $1 million in revenue worldwide from October 2012 to January 2013. The top three apps to do so were Angry Birds Star Wars (HD version as well), Grand Theft Auto: Vice City and Temple Run 2. Each of these apps pulled in $1 million worldwide, one week after release. For the business model of these apps, eight of the 10 apps were paid apps, of which four had in-app purchases. The other two apps were based on the freemium model.

Distimo will host a free webinar on the subject of new publishers and apps, which was covered in this report, on March 4 at 5:00 p.m. CET. Head here to register.

There is no better sales incentive than free money. It’s just a pity that Amazon’s new virtual currency, Amazon Coins, are not a particularly useful sales incentive.

The company unveiled Amazon Coins on Feb. 5, explaining they could be used to purchase apps, games and in-app items on Kindle Fire tablets. Most industry watchers praised the announcement, but more than a few pundits questioned the logic of the coins.

While I’ve already made my opinion fairly clear (skip to 0:34 to get to the relevant part), Amazon’s Coins do deserve more analysis, particularly since so many people are convinced they are brilliant. The real rub is that those people are technically right. Stimulating the Kindle Fire economy is an excellent idea, more so because Amazon desperately needs to do it.

Not long after the Kindle Fire was released, many developers boasted that it monetized far better than other Android based tablets, and that its app store was much more lucrative the official Android market run by Google. As interest in the Kindle Fire has dropped off, however, so have the claims that it was the ultra-profitable Shangri-La Android developers were dreaming of. Competition from the Google’s Nexus-branded Android tablets and Apple’s new iPad Mini have squeezed the Kindle Fire’s share of the mid to low-end tablet market, and the device no longer has the “hot gift” cachet it had when it debuted just before Christmas 2011.

The Kindle Fire app store has always had a much smaller pool of apps and users than Google Play and the iTunes App Store, and as interest wanes in the device, so has the influx of excited new users ready to download apps. Amazon knows this is bad news. After all, developers aren’t interested in making apps for a platform without consumers and consumers don’t want devices with a lousy selection of apps.

Microsoft is in a similar situation; its work-around for the problem has been to incentivize development, assuming the consumers will eventually come for the apps. Meanwhile Amazon is trying the opposite approach, supplying the financial incentives to the consumers and letting developers know there will soon be a lot more liquidity in the Amazon app economy.

It’s a fair tactic that doesn’t penalize the developers that bet on the Amazon Appstore before the company started its stimulus efforts, and it’s technically giving both consumers and developers what they really want — money.

So, why not just supply money? Perhaps credit every Kindle Fire owner’s account with a few dollars via a virtual gift card? Kindle Fire owners already understand how to buy apps with real money and Amazon’s customers are already comfortable with the concept of gift cards. Even if Amazon is planning to roll out some sort of rewards program with Coins (i.e. spend $10 on Kindle Fire apps, games or in-app items and get 100 Amazon Coins), why not just use a cash-back system similar to the one many credit card companies already use?

There is also the matter of what Amazon is looking to gain by creating its own virtual currency.  Microsoft Points were designed specifically to make items look cheaper than they are (an item that costs 79 Microsoft Points actually costs $0.99). Amazon Coins meanwhile, convert one for one to real cents, so Amazon clearly isn’t hoping to target bargain hunters.

Perhaps Amazon is hoping to use Coins to convince people to spend money without having to (technically) open their wallets — after all, when Facebook introduced Credits, the idea was that a universal currency would boost conversion. Again, this is a questionable choice since in the end, Facebook Credits ended up being a mixed bag. While developers saw an increase in conversion, others reported a decrease in average revenue per paying user. In the end, Facebook eliminated Credits less than a year after they were introduced opting to use a local-currency system just like Apple, Android and yes, Amazon were already using.

Millions of people already know and trust Amazon with their credit cards, and Kindle Fire users were already using a standardized payment system with the currency they understood best — dollars. Amazon’s new virtual currency is just complicating the matter with a second payment option.

CEO Tim Cook said during a Goldman Sachs conference that Apple has now paid out $8 billion to developers, up $1 billion from the $7 billion payout figure Apple reported in late January.

In October 2012, Cook announced that Apple had paid out $6.5 billion to developers, and in January Apple announced that the figure had increased to $7 billion, an increase of $500 million in a three month span. From January to February, Apple’s payout to developers increased by $1 billion in only a month, with sales most likely driven by the holiday season.

Apple’s SEC filing for its Q4 2012 earnings showed that 775,000 apps were on the Apple App Store, a number the corporation had already reported in early January. Although, in the Q&A part of the earnings call in late January, Cook said there were 800,000 apps on the App Store. About 300,000 of the 800,000 apps are native iPad apps as well.

“We have over 300,000 apps custom designed for the tablet,” Cook says. “The other guys have a few hundred.”

Editor’s note: Today’s guest post comes to us from Jan Beckers, co-founder and CEO of HitFox, an incubator focused on investing in and acquiring game distribution and user acquisition startups. This article will be the first in a five-part series of articles analyzing game platforms and the patterns that historically repeat itself.

In the middle of the first decade of the new millennium, the browser materialized as an important new gaming platform. Shortly afterward, Facebook, and other social networks, emerged as the crucial gaming platforms of the time. At the start of the current decade, mobile systems, iOS and Android in particular, moved to the center of attention, revolutionizing global communication and the games market along the way.

These are also the three distinctive eras of the gaming industry that I experienced as an entrepreneur. Going through these phases there was something that became very apparent: each time a new gaming platform emerges, the evolution of the platform and the related business opportunities and traps follow the same basic patterns. Knowing these patterns provides market participants with the ability to anticipate certain developments and make the right business decisions today and be ahead of the competition tomorrow.

In this five-part series, I will provide insight into the most important patterns.

Before we dive deeper into these patterns you should be aware of the following analogy:

A country or a society is just like a platform — without an underlying technology

Both have a set of rules and regulations established and enforced by those in power, the owners. Citizens have to abide by the laws of their country and users have to abide by the terms and policies of a platform such as Facebook. Both platforms and countries can be governed democratically or dictatorially. The open web can be considered governed democratically, make your own judgment about the ways Google, Facebook or Apple run their respective platforms.

Countries and gaming platforms see periods of growth and decline, for instance, in terms of economy, territory and inhabitants. And as the inhabitants of a country flow, so do the users of a platform. At the same time, the platform owners might enter or leave market-areas, adjusting their territory.

Countries and game platforms both have competition, not only within but also across each other. Facebook and Google struggle for domination of the web just as China and the U.S. are up against each other in the global economy right now.

And last but not least: taxes have to be paid in order to maintain the infrastructure. In countries you pay usually 10 to 20 percent  value-added tax — on Facebook and Apple you pay 30 percent Facebook or Apple tax. (more…)

A new report by Distimo finds that dropping the price of an iPhone app increased revenue by 95 percent three days after the price drop, while lowering the price of an iPad app increased revenue by 51 percent. Distimo’s debuted its analytics product AppIQ in October 2012, which allows its customers to see how many downloads and how much money almost any Android or iOS app makes, aiding in the pricing strategy process most mobile app developers deal with.

Distimo said that the effect of a price drop on revenue is significant, amplifying the longer iPhone and iPad apps remain on sale in the Apple App Store. Seven days after a price drop, revenue increased by 159 percent for iPhone apps, and by 71 percent for iPad apps. Distimo also cited increased revenue from one-off fees and in-app purchases as contributors to the increase in revenue in the long run.

On the other hand, when the price of an iPhone app was increased, download volumes fell 46 percent over five days, with download volumes dropping by 57 percent on iPad. Dropping the price of an app not only effects revenue, it effects downloads. Dropping the price of an iPhone app increased downloads by 1665 percent five days after the price drop, while lowering the price of an iPad app increased downloads by 871 percent.

Distimo then took a look at price elasticity, a number that stands for the change in revenue caused by a one percent price change. The Dutch firm found that iPhone apps show the lowest price elasticity on revenue, meaning that revenue reacted most heavily on any price change of a particular app in the Apple App Store. A one percent price drop for an iPhone app led to a 1.2 percent increase in revenue within five days. On iPad, price elasticity is -0.07 percent, indicating that a one percent price drop caused a 0.7 percent increase in revenue.

After noting that 850 apps for iPhone and 930 apps for iPad changed its prices at least once in the Apple App Store in December 2012, Distimo discovered that the majority of price changes fall within the $1 to $3 range, with the largest price changes occurring on iPad apps where 20 percent of all price changes moved the needle more than $4 in the Apple App Store.

The effects of price changes on download volumes and revenue for apps in the Apple App Store is similar on Google Play. However, Distimo said the effect in the app store for Android devices was less powerful compared to the Apple App Store. Distimo cited the higher difficulty to reach the top of the Google Play charts as the explanation for the difference between the two stores. Distimo also listed the top 10 iPhone and iPad apps that benefited from price drops by revenue, in which the majority of apps on both lists were games.

All the data from this report came from the Apple App Store for iPhone and iPad during December 2012, in the 10 largest countries consisting of Australia, Canada, France, Germany, Italy, Japan, Korea, Russia, the U.K. and the U.S. This report is only based on mobile apps that have reached the top 400 overall and had at least one price change in the month of December last year. Also, keep in mind that all this data was collected in December, a time when the holidays dramatically boost app downloads as noted by Fiksu, Flurry and others.

Distimo will host a free webinar on the impact of price changes subject, which this report analyzed, on Feb. 7 at 5:00 p.m. CET. For those interested, register here.

The Federal Trade Commission today released a new report, which outlines recommendations for mobile platforms and mobile app developers across the country to better inform its users what personal data is being collected and how the data is being used. The report comes less than a month after the California Attorney General’s office released its own privacy guidelines for mobile app developers in the state.

FTC Chairman Jon Leibowitz, who yesterday announced his resignation, said in a statement, “the mobile world is expanding and innovating at breathtaking speed, allowing consumers to do things that would have been hard to imagine only a few years ago. These best practices will help to safeguard consumer privacy and build trust in the mobile marketplace, ensuring that the market can continue to thrive.”

The FTC, the federal agency that oversees business practices, stated that mobile devices “facilitate unprecedented amounts of data collection” because users, for the most part, have their mobile device on and with them at most times. In an effort to improve mobile privacy disclosures, the FTC recommended platforms and developers provide privacy data disclosures to consumers before allowing an app to access sensitive content like geolocation and for other personal data such as photos, contacts or calendar entries.

The FTC also recommended that platforms consider implementing a version of Do Not Track (DNT), the privacy mechanism that allows users to prevent tracking by ad networks or other third parties. Multiple desktop web browsers already support DNT including Firefox, Internet Explorer, Chrome and Safari. Mozilla’s Firefox mobile browser has the DNT mechanism and Apple’s Safari has a “limited ad tracking” slider for iOS, but despite Mozilla’s and Apple’s DNT support on mobile, the privacy mechanism is not as standard on mobile as it is on desktops.

At the end of 2012, the FTC strengthened its more than a decade-old child online privacy laws, in particular, the Children’s Online Privacy Protection Act (COPPA). The new laws require child-directed websites and online services to obtain parental consent before collecting children’s personal information like geolocation data or photos before sending the data off to third-party companies. Although, the updated rules explicitly exempt app “platforms” such as the Apple App Store and Google Play from complying with COPPA since the app stores only offer “public access” to kids’ apps, as opposed to targeting kids directly and exclusively.

Both of the top app stores — Apple App Store and Google Play — showed high growth in app revenue from Q3 2012 to Q4 2012, App Annie reports. Google Play, in particular, doubled app revenue from Q3 to Q4 along with a higher growth rate than the Apple App Store. Despite Google Play’s revenue doubling quarter-over-quarter, the Apple App Store gained more in absolute revenue, considering its larger revenue base. Apple is far and away the leader in app revenue, earning more than three-and-a-half times more revenue than Google Play in December 2012.

According to the company’s January 2013 App Annie Index, Apple App Store revenue grew by around one-fifth from Q3 to Q4, increasing revenues by 35 percent from November 2012 to December. In comparison, the Apple App Store’s revenue increased by 25 percent from November 2011 to December 2011. App Annie attributed users receiving new iPhones and iPads as gifts for the holidays that led to a spike in app downloads, and therefore, app revenue.

The top five most lucrative countries for iOS developers remained the same from Q3 to Q4. Starting from first to fifth is the U.S., Japan, the U.K., Australia and Canada. For the quarter, those five countries accounted for more than 60 percent of the Apple App Store’s revenue. China, in particular, is quickly moving up the top ranking countries by revenue on the Apple App Store list, changing from No. 8 spot to the No. 7 spot in October 2012, and from the No. 7 spot to the No. 6 spot as of December. It should come as no surprise as even CEO Tim Cook said in Apple’s Q4 2012 earnings call last week that China is its second largest region. The Cupertino, Calif.-based corporation has even been rumored to be developing a cheaper iPhone that would be aimed at emerging markets like China.

Japan and South Korea led the way for Google’s app store to double its revenue from Q3 to Q4, accounting for nearly half of Google Play’s app revenue in Q4. The three most lucrative countries for Google Play developers, in order from first to third, were Japan, the U.S. and South Korea. Coincidentally, all three of the same countries had the highest percentage of app money spent on games. In December 2012, 76 percent of app revenue came from games among U.S. users. In Japan, it was 88 percent and in South Korea it was 95 percent.

After racking up 2 million downloads on Christmas Day, mobile-social game developer Storm8 was the only notable publisher to crack the iOS top publishers by monthly downloads chart, moving from the No. 14 spot in November 2012 to the No. 9 spot in December 2012.

On the iOS top publishers by monthly revenue chart, Electronic Arts reclaimed the No. 1 spot in December, with strong performance from its free-to-play title The Simpsons: Tapped Out. Japanese game company GungHo Online was the biggest mover, leaping six spots to the No. 5 spot. Earlier this week, we reported that GungHo’s Puzzle & Dragons is seeing massive success in Japan, and now the company is more valuable than Zynga. For Android, nine of the top 10 publishes by monthly revenue on Google Play were either Japanese or South Korean, French game company Gameloft was the lone Western publisher.

South Korean Naver Corp., developer of the messaging app Line, was the notable publisher on all four top publisher charts for iOS and Google Play by downloads and revenue. Line recently surpassed the 100 million user mark in less than 19 months. Line was also the top grossing non-game app worldwide for both iOS and Android, according to App Annie.

On App Annie’s top iOS game apps by monthly revenue chart, King.com’s Candy Crush Saga catapulted 28 spots from November to December, landing at the No. 5 spot. (more…)

App store analytics company App Annie today took an in-depth look at Japan, analyzing the Japanese mobile industry, the state of the platforms in the country and the companies, app genres and apps dominating the Japanese market.

In October 2012, Japan surpassed the U.S. in revenue on Google Play, becoming the most lucrative country for the Android platform, with 29 percent of the app store’s total global revenue.

Before Japan surpassed the U.S. as the leader in terms of revenue on Google Play, the country was actually late to the smartphone party, with smartphones taking only a 23 percent share of the handset market share at the end of 2011.

In Japan, the mobile market is dominated by three wireless carriers — NTT DoCoMo, KDDI and SoftBank. Traditionally, these companies have been the gatekeepers of content, but since the debut of the iOS and Android app store ecosystems, the top three wireless carriers are seeing its control over content change hands to the iOS and Android mobile platforms. This is why feature phones held on for so long in the country while smartphones blossomed in other regions, because the wireless carriers could restrict access to content and have influence over device manufacturers.

The No. 1 wireless carrier, NTT DoCoMo, doesn’t carry Apple products because it can’t control the sale of content from the Apple iTunes Store. Instead, NTT DoCoMo put its chips on Android and also built its own carrier stores to continue to maintain control on content that flows through its wireless network. For example, “dmenu” is a portal for accessing internet-based content, and “dmarket” is a market offering videos, music, books and apps.

On the other hand, the No. 2 and 3 wireless carriers, KDDI and Softbank, offer the iPhone, enabling Japanese consumers to buy content through the Apple iTunes Store instead of through the wireless carrier. The move to carry Apple products in turn has boosted the subscriber rate for both KDDI and Softbank, while NTT DoCoMo is now losing more subscribers than the competition, which leaves hope for KDDI or Softbank to overtake NTT DoCoMo as the wireless carrier leader in Japan.

All the happenings in the Japanese wireless carrier industry led to Android holding two-thirds of the Japanese smartphone market share, while iPhone has the other third. Despite Android’s handset market share, the Apple iTunes Store generates far more revenue than Google Play, although Google Play has been catching up over 2012. A trend seen in other regions as well.

App Annie also analyzed the top 20 iOS publishers in Japan by revenue from January 2012 to September 2012, finding that 18 of the top 20 publishers are gaming companies. The 20 publishers combine for more than half of the total value of all grossing content, with the top five publishers representing nearly one-third of all revenues. Also, Japanese companies dominate the chart, with only South Korean NHN, developer of LINE, French game developer Gameloft and Apple as the lone Western companies in the top 20. Publishers with deep pockets and market dominance in other regions such as Electronic Arts, Zynga, and Rovio, aren’t even in the top 20, which demonstrates the difficulty for Western companies to excel in the Japanese gaming market.

The games genre, to no one’s surprise, crushes the other app genres in revenue, with 77 percent of total revenues across all categories. The gaming category is the leader in revenue in other regions as well — the U.S. at 59 percent — but the category is not as dominate as the category is in Japan. GungHo Online’s Puzzle & Dragons, which recently reached the seven million user mark, is an example of a native mobile game for smartphones that’s leading the way for the gaming genre in Japan, demolishing the competition in terms of revenue.

Aside from games, social networking is a genre worth noting. iOS revenues for social networking apps grew 383 percent when App Annie compared its January 2012 versus its September 2012 data. Messaging app Line, which recently reached 100 million users, was the leading app in the social networking genre by revenue over a 12-month period ending in September 2012.