The Multi-Billion Dollar Gaming Industry
Games have a very rich history. They have been around for thousands of years. Senet, found in Predynastic and First Dynasty burials of Egypt, c. 3500 BC and 3100 BC respectively, is the oldest board game known to have existed and there is still a possibility that they have been around for much longer than that. But ever since the advent of the internet there has been a revolution in the gaming industry. In mere decades, it has become the most profitable industry. Some experts have speculated that it will reach over $300 Billion by 2025, considering the massive growth in the last few years.
Gaming After Internet: A Brief History
1990: Advent of the Internet.
2003: Launch of Steam, which lets gamers buy online games.
2004: Worlds of Warcraft becomes the first online multiplayer game to get 10 Million subscribers.
2007: Online gaming on mobile.
2009: Minecraft is launched.
2015: 1.5 Billion people gaming around the world.
2017: Augmented Reality game Pokémon Go is launched.
2019: Google launches Stadia, a cloud gaming platform.
The Gaming Industry and Its Impact on the Entertainment Industry
With the astronomical growth of the gaming industry in recent years, the revenues raked in by it has left everyone awe-struck. It has also challenged various traditional forms of entertainment. The global market only for online gaming in 2019 stood at $150 Billion which is more than twice of the global market of box office and recorded music combined. This is a mind-boggling insight into the recent developments of the entertainment industry. It shows a dramatic shift in the choice of consumers which are inexplicable but enlightening.
The countries fueling this gaming revolution are China and the United States, the global gaming market spending is dominated by them. The United States spends $36.9 Billion dollars closely followed by China with $35.5 Billion dollars, which makes up to 48 per cent of the total global gaming spending. In recent years, the gaming market has become an unstoppable force to reckon with and is now all set to dominate the entertainment market for decades to come.
Online Gaming
Online gaming platforms can be categorized into three groups –
a. PC gaming
b. Mobile gaming
c. Console gaming
Mobile gaming has the largest share of online gaming among the three. 45% of the total market share which comes to be around $68 Billion in 2019 came from mobile gaming. With technologies like 5G which are going to become mainstream in coming years the dominance of mobile gaming is going to become even more pronounced.
What remains to be seen is to what degree is the advent of 5g is going to change the dynamics of the gaming industry but it won’t be a surprise if we see a great shift in favour of mobile gaming, P.C gaming and Console gaming will definitely find it hard to cope with this shift of greater preference for it. But these are mere speculations only time will tell what happens, what is beyond doubt is that it is going to be extremely tough for PC and Console gaming to compete in the gaming market.
How Does Free-To-Play Online Games Make Money?
There has been a large growth in the number of free to play games in recent years. Games like PUBG and Fortnite have become household names. The popularity of such games is not surprising. But what is interesting to notice is that they are free to play. So do they not make money? What is their revenue source and how much do they make on average? A lot of people have such questions. It might seem like free to play games may not be much profitable but on the contrary, their business model brings in billions of dollars in revenue. What they do is they let people play free of cost. But they have tons of tempting in-game purchases which help them make billions. For example, the total revenue that PUBG mobile generated last year was $1.3 billion. The revenues of these companies are expected to grow exponentially in the future as well.
So What Is the Future of Gaming Going to Be Like?
The growing technological advancements in the coming decade will probably revolutionize the gaming industry in unimaginable ways. As soon as 5G becomes mainstream it is obvious the mobile gaming industry will see a huge jump. The exponential growth of the last few years will continue and it might take over the online gaming industry. But there are few developments that might challenge mobile gaming dominance as well, with industry leaders’ Oculus and Valve providing cheaper headset options, blurring the line between fantasy and reality has become even more accessible. Cloud gaming, as well as future real-time game personalizations depending on gamers personality and play-time, will definitely change the gaming industry.
What remains to be seen is how these technologies develop over time and how quickly they are accessible in the market. Undoubtedly, the future of gaming is here and the next decade will probably define the gaming industry for the future.
