Mobile games industry attracts major funding

The mobile games market attracted â'¬327 million worth of funding since September 1999, according to a report by media researchers Screen Digest. Of that total, 56% was raised last year.

"A significant part of this investment has been driven by private equity houses as the mobile games market begins to realise its potential," said the report.

Between 2002 and 2004 fundraising for mobile games companies - such as Digital Bridges and Atatio in the UK and Jamdat in the US - increased from â'¬23 million to â'¬183 million.

Worldwide spending on downloadable mobile games stood at â'¬380 million in 2003, and over the course of the following year this figure rose to â'¬778 million.

Screen Digest also found that merger and acquisition activity has been on the increase for the past 12 months. A total of 19 mobile game developer transactions were made in 2004 - up from just four in 2003 and two in 2002.

"The recent development of a dedicated mobile publishing division by a number of computer and video games companies, most notably Electronic Arts, is evidence that the mobile games market has finally come of age," said the report.

Ben Keen, Screen Digest's chief analyst, commented: "Once the top developers have been acquired, there is likely to be a trend towards consolidation at the publishing/aggregation level to achieve greater 'scale' in the marketplace.

"We believe that once again it will be the private equity houses that will emerge as the driving force behind any sector 'roll-ups'."