The growing revenues demonstrate the increasing willingness of gamers to spend real money on their virtual characters in online worlds. Players of popular games such as Fortnite tend to be convinced to pay in-game as the items cost smaller amounts and are called microtransactions.
Also many mainstream games operate a ‘closed loop’ system, where items can only be bought from the developer and players cannot then sell or trade them with each other.
Yet some more niche game operate a freer in-game economy where items can be bought and traded among players, with rarer items fetching vast prices.
Club NEVERDIE entrepreneur Mr Jacobs entered the record books when he purchased an asteroid space resort for $100,000 (£75,000) in 2005, in the sci-fi massively multiplayer online role-playing game (MMORPG) Entropia Universe, which uniquely boasts its own real cash economy.
Players can deposit real cash to purchase the in-game currency, Project Entropia Dollars (PED), which in turn can be used to buy high-end items such as healing kits, rifles and spaceships, some of which are then regularly traded between players for six-figure sums.
Mr Jacobs explains that while these numbers might seem “insane” to non-gamers, players see the items as “tools for making money” and can be “very profitable” for their owners, however critics argue that making a profit in the game is unattainable for the average player.
“When everything you do costs something, then everything that you find, that can be used, has more value,” says Mr Jacobs.
The space resort deal was a no-brainer for the gaming millionaire, who many years earlier had predicted the boom of a virtual reality economy. It would prove to be a shrewd move by Mr Jacobs, who quickly turned a healthy profit by taxing players for using his asteroid’s resources.
On the asteroid players could hunt animals and mine resources that they could then sell onto other players.
“I put my house on the line, it was $100,000 (£75,000) at the time,” he recalls. “I ended making between $200,000 (£150k) to $250,000 (£190k) a year from the asteroid...”
Mr Jacobs, better known in the gaming community as NEVERDIE, his avatar, became obsessed with video games from an early age when his father presented him with a Sinclair ZX81, the first affordable mass-market home computer, declaring to him: “This is the future.”
Mobile games have changed a lot over the years.
Some gamers still have their misgivings, but the quality of mobile games continues to rise, and with that, some serious money is being made.
An increasing number of mobile games have generated over $1 billion of lifetime revenue.
Some now do so on an annual basis.