Future Business Model for Mobile Cloud Gaming: the Case of South Korea and Implications

Abstract

5G was expected to have a disruptive impact on society owing to its high bandwidth, hyper-connectivity, and low latency. Mobile cloud gaming, therefore, was expected to take off with the introduction of 5G. However, progress has not been successful and it means that factors beyond technological advancement need to be considered. This paper interviews experts to analyze the current status of mobile cloud gaming services to better understand the mobile cloud gaming industry. The findings reaffirm that the performance of the service (e.g., latency, coverage of 5G networks, etc.) is a critical factor, but also reveal the lack of consideration of the polarized user segments and bidirectional requirements of gaming services. Therefore, to facilitate the expansion of mobile cloud gaming, industry and academia alike should focus on transforming the mobile cloud gaming services in two ways. First, provide bundles of casual games with a freemium business model using existing infrastructure. Second, expand coverage of 5G networks and optimize service for ultra-low latency. Since it is more feasible to take the first approach, it is recommended that the initial efforts focus on the first, rather than the second, which frequently has been the case.