According to app store data, Japan has become the world’s No. 1 country in app store revenue, overtaking the United States, thanks to an explosion in growth of smartphone and tablet games. According to the same data from app tracker App Annie, Japanese consumers spent roughly 10% more than U.S. consumers did on apps found on smartphones and tablets in October. The amount spent in Japan is triple the spending in South Korea and six times greater than that in Great Britain. Just a year ago, Japanese consumers spent 40% less than U.S. consumers.
This reversal and trend reflects a shift from Japan’s usual “feature phones” to smartphones in a country that pioneered mobile Internet systems. Japanese consumers have long been conditioned to buy digital content from train schedules to games to fancy emoticons on advanced feature phones. Japanese carrier NTT DoCoMo introduced its mobile Internet service i-mode at the beginning of 1999, eight years before the first iPhone and nine years before the first Android-powered phone. In 2009, Japanese consumers were already spending more than 553 billion yen (around US$5.4 billion) on digital content. So the potential was very much inherent to Japanese society.
“The adoption of smartphones is much faster than what we expected,” said Peter Warman, chief executive at Amsterdam-based game data research firm Newzoo BV. “It’s fueling further growth.” The main sales driver, it seems, has been mobile games. Japanese consumers spent nearly four times as much as a year ago on gaming apps, the data from App Annie revealed. That has lifted spending on Android-powered devices to quadruple in the year to October, making Japan the first in the world in Google Play spending, and Android app spending has caught up to spending on Apple’s iPhones and iPads.
In this environment, many Japanese companies are now eyeing partnerships with local game developers to combine overseas tastes with Japanese know-how. Gree Inc., a pioneer in social games with its popular “Fishing Star” game in 2007, last year bought U.S.-based “Modern War” mobile game developer Funzio for US$210 million to build games for Western audiences. Line Corp. is looking to expand partnerships around the world. It recently partnered with PT Kreon Mobile, a subsidiary of Indonesia’s largest online game publisher, PT Kreon.