• by Mark Walsh  @markfwal, September 8, 2011

Generation Y likes to play, but Generation X is willing to pay. That's the upshot of a new study by app analytics and advertising firm Flurry on free-to-play mobile games. Based on analyzing 1.4 billion sessions from over 20 million users, the firm found that younger users were more likely to play "freemium" games than older ones, but older ones were more likely to pay to gain higher-level access or make in-app purchases.

A prior report by Flurry found that free-to-play games overall actually end up driving more revenue than paid ones. The latest research showed that people 13 to 24 were the heaviest users, accounting for more than half (54%) of the time spent playing games, but only 21% of spending. Those 18 to 24 were the most avid gamers, driving 32% of usage. Overall, the average age of the consumer, based on time spent playing freemium games, is 26.6 years old.

But most of the money game developers make comes from people in the 25 to 54 age group, which accounts for 77% of the spending on things like virtual weapons or tools for in-game play. The sweet spot is those 25 to 34 -- who make up 49% of the spending, although generating only 29% of usage. People 55 and over are not really caught up in the gaming craze. They accounted for only 3% of time spent playing and 2% of spending.

The results are not surprising. Younger users have more available time, while older gamers are more likely to have less time but more disposable income.

Flurry points out that to advance in games without spending requires players to do what's known as "the grind" -- the core set of gameplay actions that enable users to level up, earn in-game currency and progress. That takes time and patience.

"For consumers that have more time (or less money), they can afford (or must be) more patient. Younger gamers, presumably high school and college-age, likely have more time but less money. So the grind is something they are willing or must commit to, in order to progress. And with more total available time throughout their days, they can play more frequently," stated a blog post on the company site Thursday.

The conundrum for game developers is that younger players are the most loyal customers, but it's harder to make money off them.

Older players have less time to work their way through the grind, but are likely to buy their way out of it. "They play less often, but make quicker progress by simply spending. Furthermore, when we expand the age range to 24-54, this older group generates nearly four-fifths of all revenue in freemium games," noted Flurry.

That's different from, say, the movie industry, where young adults are more likely to go out to the movies than older ones, and therefore generate more revenue for Hollywood. The upside for game makers is knowing that all those younger, heavier gamers will eventually become higher-spending ones.