This report is by Daniel Ahmad, Analyst, Niko Partners in conjunction with Sensor Tower.

Southeast Asia’s mobile games market is booming, representing a lucrative opportunity for mobile developers and publishers.

Huge numbers of avid gamers, lower user acquisition costs, the prevalence of the English language, and a relatively open market for new entrants all make the region very attractive.

The number of mobile gamers in Southeast Asia is set to grow from 170 million at the end of this year to 250 million by 2021. Likewise, revenue is projected to grow from $1.1 billion in 2017 to $2.4 billion in the same timeframe, faster than previously forecast.

In this snapshot, I’ll look at the top mobile games in the region for October 2017 and discuss the various trends in play.

We should note that the data displayed in the chart above is for iOS and Google Play only. Third party app stores and direct downloads from Garena (for Arena of Valor) are not tracked by Sensor Tower at this time, yet are rising in importance in the region.

MOBA games dominate and drive mobile esports

Southeast Asia’s mobile games market is constantly evolving. Whilst RPG and Strategy games have been traditionally important to the market, the MOBA genre has gained traction and is now a huge driver behind mobile esports in the region.

Garena and Moonton are the two most successful publishers of MOBA games in the region thanks to Arena of Valor and (very similar title) Mobile Legends.

Arena of Valor, known as Honor of Kings in China, is co-developed by Tencent Games and Garena, and published by Garena in Southeast Asia. Honor of Kings is a smash hit in China, where more than 50 million users play every day, and Garena has been able to localise and successfully publish the game in Southeast Asia.

First launched in October 2016, Arena of Valor has been a mainstay at the top of the download and revenue charts as many fans of games such as League of Legends have been able to pick up and play the game on mobile. The game is referred to as the mobile version of LoL.

The game's main competition in the region is Mobile Legends from Moonton, a Chinese developer. Moonton has been able to replicate the MOBA experience, drawing a lot of inspiration from both League of Legends and Arena of Valor.

Moonton has been quick to ensure that its game has feature parity with Arena of Valor and has worked hard to bring constant updates to the game. This has allowed the game to surpass Arena of Valor on the Google Play and iOS combined chart.

However, we should note that this is not the full story as a huge number of downloads for Arena of Valor are via Garena’s own mobile game distribution platform which is not tracked in the above rankings.

We also note that Moonton is currently being sued by Riot Games over claims of copyright infringement. Riot Games believes that Mobile Legends is too similar to League of Legends and uses similar imagery in the game. Moonton has denied this outright but the court case has not reached a conclusion at this point.

Netmarble successfully launches Lineage 2: Revolution

One of the big success stories this year is the SEA June launch of Lineage 2: Revolution, an MMORPG based on the Lineage series, which is quite popular throughout Asia.

The game grossed over $176 million in its first month after launch in it’s home market of Korea, setting a record for fastest grossing mobile title. Netmarble announced that they would bring the game to the West soon after.

An English language version of the game soft-launched in June across Malaysia, the Philippines, Singapore and Thailand. One of the reasons Netmarble soft launched the game in Southeast Asia before launching in the West is because the region is a perfect testing ground for new games.

With a large number of mobile gamers, lower user acquisition costs and plenty of English speakers, many international developers choose to launch games in Southeast Asia before launching in the West. This gives developers the opportunity to view feedback and tweak the game in preparation for a much wider launch.

MMORPG and Strategy games are a mainstay in Southeast Asia

Popular MMORPG games such as Legacy of Discord contain PvP modes which allow users to play with and against their friends.

Strategy games such as Lords Mobile, Clash of Kings, Summoners War and Clash of Clans also have real time multiplayer and PvP modes in them. It’s this social element that drives these games to the top of the grossing chart.

We note that the most popular MMO and Strategy games are from international developers. Com2us is from South Korea, Supercell is from Finland, Youzu, IGG and Elex are based in China. Southeast Asian mobile game developers are still emerging and yet to compete globally.

Casual F2P games dominate the download chart

Whilst Southeast Asia’s mobile games market continues to grow at a fast rate, average spending in games is still low.

A large majority of gamers do not spend on mobile gamers in Southeast Asia and this is why the download charts are dominated by casual games such as Subway Surfers, Candy Crush, My Talking Tom, Slither.io and Plants vs Zombies. These games do not require you to spend much in order to enjoy them.

Our latest report, SOUTHEAST ASIA MOBILE GAMES REPORT & FIVE YEAR FORECAST, contains more analysis on the SEA mobile games market.

Methodology:

Each month Niko Partners provides analysis in this column on trends in mobile gaming in Asia based on data provided by Sensor Tower on monthly rankings of game apps by downloads and revenue.

The country is selected by Niko Partners, out of the list of eight countries we track regularly: China, Indonesia, Malaysia, the Philippines, Singapore, Thailand, Taiwan (Chinese Taipei), and Vietnam.

Sensor Tower’s mobile data analytics provides information on iOS and Android mobile apps in all countries except China, where they currently cover iOS only.