Since Q1 2010, online gaming has led mobile gaming every quarter in both venture capital dollars and deals. In fact, online gaming companies over that period have garnered $3.1 billion in VC funding across 356 deals as compared to mobile gaming which has netted $1.3 billion in VC funding across 190 deals.
Despite the large disparity between online vs mobile gaming over the entire 10 quarter span, mobile gaming has begun to close the gap significantly as of late. This has been partly as a result of a sharp decline in funding for online gaming over the last five quarters (driven in part by increasingly negative sentiment about social gaming. The Zynga Effect?). After experiencing a high in total investment in Q2 2011, funding to online gaming fell to a ten-quarter low in Q2 2012. Mobile gaming has not been particularly strong since Q1’11 either, but in Q2’12, mobile gaming saw only $13 million less in VC funding than online gaming.
Deal activity, which we generally view as a better indicator of industry trends, showed mobile gaming catching up to online gaming. In 2010, online gaming averaged 39 deals per quarter, compared to 14 deals for mobile gaming. Through the first two quarters of 2012, the distance has narrowed as online gaming averages 32 deals per quarter and mobile gaming averaged 23.5 deals.