Social game opportunities in Africa

Lloyd Melnick —  June 7, 2012 — 6 Comments

This is a topic I did not expect to be writing about but a recent article in The Economist got me thinking about opportunities for social game companies in Africa. To be perfectly open, this is not a region I have focused on professionally since the late 1980s and I have no first-hand experience with monetization opportunities there. That said, I am going to be exploring the region further and think it may hold potential.

Here are the reasons I am giving Africa a look and ones you may want to consider:

  • Africa is the second fastest growing economy in the world
  • The population is over one billion (more than twice the US and about the size of India or China)
  • Collective GDP is greater than India or Russia (about $2 trillion)
  • The primary language in key African markets is English. These countries include Nigeria, Kenya, South Africa, and Ghana. Conversely, the primary languages in the BRIC markets (considered the key emerging markets) are Portuguese, Russian, Chinese while only India uses English as its main language for business
  • As the social game industry evolves from relying on web platforms to mobile platforms, more Africans become potential game players. As I mentioned in my notes from the Mobile World Congress, it was amazing how many executives came from Africa
  • Nigeria, which has a population of 158 million people, has been growing by almost 7 percent annually over the last eight years
  • General Electric (GE) has just put its African HQ in Kenya
  • Egypt, the country with the second largest per-capita GDP in Africa, recently held free elections and could become a magnet for investment in both Africa and the Middle East
  • South Africa’s GDP per head is greater than China’s or India’s

I am still not sure if Africa is worth diverting significant resources to immediately, but it is definitely worth a closer look. It could be a great new revenue opportunity with much less competition than other social game markets.

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Lloyd Melnick

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I am CEO of fiveonenine games, the social gaming joint venture owned by Capitol Broadcasting and The E.W. Scripps Company.

6 responses to Social game opportunities in Africa

  1. 

    Interesting post Lloyd. Our experience has been in EMEA (with a top 10 game in six countries) that we get plenty of downloads but limited monetization from in-app purchases. From what I’ve seen of African charts on App Annie, games don’t dominate top grossing like they do in other countries. I bet Distimo has precise numbers on total revenue in those markets.

    • 

      The reason you see limited top grossers on app annie is because older people in this region are generally Technophobic and younger people with smart phones in these countries believe that the local app stores are useless, so they rather get fake US accounts for their app purchases. Also, for the most part people are generally still stuck on Black berries and have only just begun to move to iOS or Android, but as with India and China this market is far more likely to end up on the GooglePlayStore than the AppStore because iOS is too expensive, with the vast majority of gamers in the market also being hardcore console or pc gamers. Since there is no public transport system for professionals, the 20somethings are not bitting as they would in other countries, while those of lesser means that have public transport are barely litterate and therefore credit cards for online purchases are impossible. My guess would be that this market will only become a viable tablet option for social gaming in the next 5years with the smaller iPad mini type devices as the curreny generation of kids grow up to be able to afford them. While most of the real money from the region will go through the US stores until a more drastic effort is made to convince the public that they are being served with better quality applications.

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