Conducted by Digi-Capital, the global games investment review states that online and mobile could have a revenue share of $48 billion in 2016, 55 per cent of the entire game industry.

The biggest driver in mobile and tablet app revenue meanwhile will be free-to-play, which could deliver 55 per cent of revenue in the sector and account for 93 per cent of app downloads by 2016.

The research also covers a record year for mergers and acquisitions in the industry, which added up to an impressive $4 billion in 2012 through 83 transactions.

The number of M&A’s however was down 27 per cent from 2011, although transactions only amounted to $3.4 billion during that year.

In 2012, the most popular sector for mergers and acquisitions was the MMO market, which accounted for 38 per cent of all transactions, with mobile closely behind making up 27 per cent of the value of all M&A’s.

Social gaming meanwhile accounted for 18 per cent of the total value in mergers and acquisitions, middleware and gamification made up 13 per cent, with console-focused companies making up just four per cent.

Seven of the ten largest mergers and acquisitions in 2012 were made by Chinese, Japanese or South Korean companies.

SOCIAL GAMING INVESTMENT PLUMMETS

Investment in the game industry totalled $853 million from 165 transactions in 2012, a decline of 57 per cent from 2011.

Middleware and gamifcation led the way making up 35 per cent of the total investments made, followed by mobile at 31 per cent, MMOs at 18 per cent, social and casual at seven per cent and console/PC also at seven per cent.

Social gaming was blamed for the sharp decline, with a drop in investment of $1 billion compared to 2011, a fall of 94 per cent.

Digi-Capital noted that venture capitalists had abandoned social games investment during last year, excluding mid-core and social gambling, while some VCs even outside the social sector left the market completely.

KICKSTARTER'S IMPACT

Kickstarter was also mentioned in the report, accounting for six per cent, or $49 million, of all video game investment in 2012.

The biggest concentration of investment through the crowdfunding site went toward PC games, which made up 63 per cent of all funding, followed by hardware at 23 per cent.

87 per cent of all investment raised went into just seven per cent of successfully funded projects.

As for consoles, despite a decline in market share and popularity, Digi-Capital noted that the next generation of consoles from Nintendo, Microsoft and Sony could rejuvenate the sector should they adapt to free-to-play, become more communal and enable more cross-platform play.

You can view the full review at the official Digi-Capital website here .