Paid Game Revenue Falls to All-Time Low on the App Store—But is Apple Arcade Having an Impact?

As new premium game subscription services such as Apple Arcade launch on mobile, the share revenue generated by paid games on iOS has fallen to 1.8 percent as of September 30, 2019—its lowest ever, according to Sensor Tower Store Intelligence data.

For this report, we analyzed paid games available on the App Store globally since January 2014, excluding China where Apple Arcade isn't currently available.

As of September 30, premium games had grossed approximately $337.3 million year-to-date on the App Store. Since 2015, when paid games generated $641.9 million, or 5.4 percent of all revenue, the premium market has been in decline. In 2018, paid games saw users spend $475.7 million, or 2.2 percent of all revenue.

The number of game releases has also declined substantially in recent years, from 39,705 premium releases in 2014, or 26.1 percent of all games released, to 3,255 so far in 2019, or 7.3 percent of new launches.

In September 2019, 51,663 of the App Store's 399,056 games were paid, accounting for 12.9 percent. Prior to a large reduction of games in July 2018—perhaps at least in part due to Apple's move to 64-bit apps—108,956 out of the marketplace's 624,579 games were paid, making up 17.4 percent.

For comparison, in January 2014, 74,360 out of 170,697 games on the App Store were paid, accounting for 43.6 percent of the total catalog.

Apple Arcade's Impact

Apple's solution to drive a revival of premium game experiences on the App Store has been to launch its subscription service, Apple Arcade, which features more than 100 games at a cost of $4.99 a month. At that price, the subscription service would require approximately 11.7 million subscribers paying for 11 months after their one-month free trial to equal 2015's $641.9 million generated in paid game revenue.

When it comes to Apple Arcade's impact on the premium and free-to-play games market, it doesn't appear as if it has had a significant chilling effect on the uptake of other premium iOS games. Apple Arcade's launch month between September 19 and October 18, 2019 saw paid games generate $34.2 million on iOS, down about 13 percent from $39.2 million between August 20 and September 18, 2019. It should be noted that seasonal factors, such as summer vacation, typically lead to games revenue declining as summer transitions to fall.

For comparison, the period of September 19 and October 18, 2018, when premium games grossed nearly $33.8 million, was down 4 percent from $35.2 million spent between between August 20 and September 18, 2018. While the drop in 2019 revenue is greater than in 2018 between these periods, premium game revenue during Apple Arcade's launch month was fairly static year-on-year, rising by just under 1 percent.