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A new report suggests that mobile gaming, which includes smartphones, tablets, and dedicated units, could earn $12 billion by the end of the year.

The Nintendo 3DS and PlayStation Vita are gaming`s latest dedicated handheld devices, but they haven’t had an ideal reception. Thanks to high prices and small launch libraries, both systems generated significant losses for their manufacturers, even in an otherwise profitable mobile industry. That said, the prospects for these systems may finally be turning around; according to a report by the IDS and analytic firm App Annie, the 3DS and Vita are expected to reverse their trends of falling average revenues by the end of 2014.

The report states that dedicated handheld units will go from earning $15 average revenue per user in 2013 to $19 dollars within a year and a half. That may not sound like much, but that’s actually a higher revenue than smartphones or tablets, both of which are expected to drop to $10 per user. Smartphones and tablets are still earning higher overall profits, and will continue to do so until fans start buying 3DS and Vita systems in the same numbers as Android and iOS devices.

While prospects for the 3DS and Vita may improve, that doesn’t necessarily mean they`ll catch up to smartphones and tablets. The actual installed user base for dedicated handhelds is expected to remain steady, while the market for smartphone and tablet games should grow exponentially. All told, App Annie and IDC expect mobile markets to increase from 800 million portable devices in 2012 to 1.2 billion by the end of next year. Approximately 51% of the revenue generated from these devices is predicted to come from microtransactions.

Source: Games Industry International

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