JultikaUniversity of Oulu repository

This thesis aims to explore the concept of network effects between platforms and mobile games by analyzing economic theories on network economics, information goods, two-side market, and the game industry itself. There is previous research on gaming, but it deals with online gaming and consoles, not “mobile” specifically, which is why this thesis is specifically dealing with mobile games. Over the past decade, the game industry has been changing because of advancements in technology, and the changing demography of who plays games. This makes the gaming industry economically interesting from the perspective of the business models, pricing structure, and the relationship of the information good with the platform it exists on. These are concepts that are discussed throughout the thesis. Network economics is discussed at length because it is what aided in answering the question of whether or not there are network effects between the platforms and mobile games. Although it does explain the connection between number of users and software variety, it was necessary to expand on the concepts of information goods and two-side market because these explain the specific phenomena of selling software through a dedicated platform. In order to strengthen the economic theory and previous research, an interview with a mobile game company was conducted. The questions revolved around how it developed the games, how it sets prices, and its behavior with the platforms. In addition to supporting theory, the interview also served the purpose of verifying whether or not the descriptions of the game industry found in literature really occur. In conclusion, the interview answers did support the theories and the literature, with the exception of the company being a price-taker. In conclusion, the literature, previous research, and the interview, all support the concept that there are network effects between mobile games and platforms. Although the thesis statement is supported, this does not mean that it is proven due to a lack of empirical analysis, and more case studies.