Inside Social Games

The growth of the iPhone and the overall success of the Apple’s App Store has been covered extensively. However, while we have looked at some early metrics on app downloads, the most overbearing question has always been whether or not to make your app free or premium.

Despite the numbers presented by Pinch Media suggesting most apps should go for paid model, 33% of mobile users still have never paid for a mobile game. The number comes from the January Consumer Insights Report from Greystripe, a mobile game ad network.

Greystripe is one of the largest ad networks for game developers going with ad-based models in their games. Last summer, the company turned its attention to the iPhone, and since then its publisher network has hit 140 million downloads for the mobile device (180 million across all supported mobile platforms).

However, Greystripe says that 50% of its impressions come from the iPhone. This is hardly surprising, as according to their same report, 64% of users screened play video games anywhere from 9-20+ hours a week.

To that end, Greystripe works extensively with publishers to allow easy integration of dynamic and interactive Flash (though the “Flash” is their own version since Adobe’s Flash doesn’t cooperate with the iPhone) advertisements into their games. The company offers no new APIs nor requires the repackaging of code, but rather it simply has publishers upload their mobile game and follow a wizard.

Of course, if developers so desire, they can also get greater distribution within Greystripe’s collection of about 50 iPhone apps and 850 for other platforms by using their catalog platform or their mobile gaming portal, GameJump.

As with all things, however, there have been some naysayers towards Greystripe’s mobile ads. In an article by the New York Times, Peter Gardiner, chief media officer for the ad agency Deutsch claimed that web ads do not work on cell phones, sand that different ads should be tailored to the small screen.

Michael Chang, CEO of Greystripe disagrees, stating, “I think that’s a relevant way to describe mobile two years ago. That radically changed with smartphones and especially with the iPhone. It is not a different digital medium than the Web – it is really the same.” Chang states that about one-third of digital medial buyers are currently requesting mobile ad space.

Just last month, the company raised $5.5 million in Series C funding led by Venture Capital, with Steamboat Ventures and Monitor Ventures participating as well.

We’ll continue tracking the intersection of mobile game monetization models and social gaming monetization models here on ISG.