The gaming industry is undergoing a period of significant transition. Changes in how games are discovered and monetized have reshaped the strategies of developers across mobile, PC, and console platforms. In an environment where competition is intensifying and user attention is increasingly difficult to capture, third-party intellectual property (IP) licensing is becoming a central tool for mitigating risk, improving visibility, and increasing player engagement.

IP Licensing in Gaming: Overcoming Market Saturation

Platform Dynamics and Discoverability

Since the deprecation of IDFA in 2021, mobile game developers have faced rising costs to acquire new users. Although global smartphone adoption has continued to increase, the number of unique games available on the iOS App Store has declined sharply, from around 600,000 in 2016 to fewer than 200,000 by 2024. Despite this reduction in available titles, developers are spending more on advertising than ever before. Marketing budgets are becoming an essential part of the business strategy for mobile games, as discoverability becomes more difficult and organic reach continues to decline. A clear example of this shift is Monopoly Go!, the highest-grossing mobile game of 2024, which spent approximately 36 percent of its net revenue on advertising during its first eleven months.

On PC and console platforms, the challenge is not a decline in the number of new games, but rather the growing difficulty of standing out. Platforms like Steam have experienced a steady increase in game releases, but user attention remains concentrated on a small number of top-performing titles. In 2023, only 6.5 percent of player time on PC and major consoles was spent on games released that year. Of that, only 3.6 percent of time was spent on games outside the top four titles, highlighting how most new releases struggle to gain meaningful traction. This saturation is forcing developers to rely more heavily on paid marketing to drive discovery.

Monopoly Go

Familiar IP in Player Acquisition and Retention

In response to these market conditions, game developers are increasingly turning to third-party IP as a way to improve performance across user acquisition, engagement, and retention metrics. Familiar IP can help reduce the perceived risk among new players by creating an immediate connection based on recognition and pre-existing positive associations. However, while IP can support better initial impressions, it does not necessarily guarantee higher organic discoverability, particularly in genres that are already crowded.

The more reliable benefits of using well-known IP are reflected in paid acquisition efficiency and user lifetime value. According to a study conducted by Newzoo, IP association was a notable motivator for both average and high spenders, with 11 percent and 13 percent respectively citing it as a reason for downloading a game. This link between IP and financial performance is also seen in broader market data. In 2023, 43 percent of the top 200 grossing mobile games in the United States included third-party IP, generating approximately $16 billion in in-app purchases. This figure accounted for 21 percent of the year’s total mobile IAP revenue.

Global Gaming Revenue By Category (Billions)

Case Studies in IP-Driven Development

Scopely offers a clear example of a game company that has successfully focused its strategy around licensed IP. While the company launched several original games in its early years, it shifted over time to exclusively releasing games based on licensed properties. Titles such as Yahtzee With Buddies, Star Trek Fleet Command, and MONOPOLY GO! have become staples of its portfolio. By 2023, Scopely had generated over $10 billion in lifetime revenue and was acquired for $4.9 billion. In early 2024, the company further solidified its role in licensed game development through the acquisition of Niantic’s game division for $3.5 billion.

Lower Barriers to Content Creation

As development tools become more accessible, content creation is becoming faster and less resource-intensive. Low-code and no-code platforms, alongside AI-driven asset generation tools, are enabling more developers to bring new games to market. While this trend supports greater experimentation, it also contributes to further saturation. In such an environment, known IP becomes a more important signal of trust and quality, helping games stand out from a growing field of new releases.

Number of New Games Release Per Year on Steam in Last Decade

IP Licensing as a Strategic Business Decision

Beyond the benefits for developers, IP licensing is also gaining traction as a preferred strategy for IP holders. Maintaining in-house game development teams can be costly and carries significant operational risk, especially for companies whose core businesses lie outside of gaming. As a result, brands such as Disney and LEGO have chosen to license their IP to experienced game developers rather than investing in internal studios. This approach allows them to maintain a presence in gaming, one of the strongest segments of consumer entertainment, without incurring the overhead associated with direct development.

Number of IP Based Mobile Games Launched Each Year

Conclusion

Across mobile, PC, and console platforms, discoverability challenges and the rising costs of user acquisition are reshaping how games are developed and marketed. In this environment, third-party IP is proving to be a valuable asset. It helps reduce acquisition costs, improves player engagement, and increases lifetime value, particularly among the highest spenders. As development becomes cheaper and more accessible, familiarity and trust become essential to stand out. For both developers and IP holders, licensing presents a practical, lower-risk strategy to navigate the increasingly complex and competitive gaming landscape.

Source: Konvoy