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From light gun accessory for Magnavox (Brown Box), Xbox to Xbox Series X, PlayStation to PlayStation 5, and SEGA SG-1000 to SEGA Advanced Pico Bena, the main rivals in the gaming market have evolved drastically with the advancement in technology.
Gaming console refers to a computer system that enables users to play video games by connecting it to display devices such as television, monitors.
The gaming consoles have witnessed various hardware changes over the past couple of decades. The overall Lifecycle of the consoles has changed over the years; the earlier generation gaming consoles used far longer lifespan than current generation consoles. Manufacturers have made various iterations to the current platforms.
For instance, Sony’s PlayStation 5 platform has two consoles, such as PlayStation 5, PlayStation 5 Pro, and PlayStation slim; Microsoft upgraded the Xbox line up with Xbox Series X. Besides, the amount of time spent by consumers on gaming is increasing, with the global average being 7.11 hours per week.
The evolution of the gaming community also pushed the growth of the market, ranging from Super Mario to Far Cry 6 and Watch Dogs (legion).
Moreover, owing to the launches of new-generation console products from prominent players, like Sony and Microsoft, there has been a massive increase in sales in recent years. In addition, the game titles on these platforms are not backward compatible due to which the gamers are always trying to upgrade their consoles with the current advanced technologies and innovations.
Currently, the hardware requirement of various games and the multipurpose use of home consoles for purposes such as browsing, provision of various other applications, etc. have further enabled growth.
In addition, the release of supportive multiple provision accessories, such as 4 K TVs, has been effective, and have been driving the demand for the home consoles, as they provide a way better gaming experience to an average gamer than other options available.
To know more about Global Connected Gaming Console Market, read our report
Earlier, handheld gaming consoles were ruling the market with Sony PSP and Nintendo Game Boy. As technology developed, the basic platform for gaming also changed. This introduced a new path for TV gaming consoles like Sony PlayStation Series and Xbox Series.
Today, more than 700 million people prefer to play video games on a dedicated console. And the way companies in the sector make money has changed rapidly over the years. Now, with new consoles from Microsoft and Sony on sale, there’s a clear push from both companies deeper into software and subscriptions.
They’re hoping to capitalize on rising demand for games as consumers around the world spend more time at home during the coronavirus pandemic. But a viral pandemic isn’t the only thing that’s changed the gaming industry recently.
As the gaming community grew, TV Gaming consoles were considered as the next level of gaming. They gained much popularity which resulted in majority of the gaming consoles being TV based.
While the gaming market produced products with enhanced features for hardcore gamers, they initiated the production of gaming suitable for casual gamers as well owing to progression of the shifting market demand.
For casual gamers, vendors released consoles like Nintendo Switch, Nintendo Switch Lite, and Sony PSP Series. Along with that a series of consoles like smartphones, tablets, and Budget Laptop were also introduced for casual gamers. This brought in a large number of casual gamers into the gaming industry.
Gaming Consoles have now become a much more profitable business for firms like Microsoft, Sony and Nintendo than they were a decade or two ago. There’s been a move to a point where hardware is profitable, software has always been profitable and network services are playing a much larger role in keeping people within the console gaming ecosystems.
Although, the companies, like Valve and Google, have been putting efforts to change the dynamics of the console market. These cloud-based services have eliminated the requirement of specific consoles to have superior gaming experience.
Valve has been a significant player in the cloud-based gaming segment, and Google also introduced its line-up of 22 games in 2019 through the Stadia service. Thus, making it less likely for the gamer to depend on a console to play.
However, gaming enthusiasts are not ready to give away their consoles just yet for that immersive gaming experience. These innovations are just a cherry on the cake for enhancing and further expanding the gaming community across the nation with new innovations coming up, thus attracting new users into the big community.
The global gaming console market is estimated at $XX Billion in 2023 growing at –% CAGR till 2030. Gaming revenues have gone unscathed despite a pandemic, a retraction in economic activity, and the tightening of budgets for households in 2023. This trend could well be a result of video games growing as a form of stay-home entertainment.
The outbreak of Covid19 followed by mandatory nationwide quarantine norms have presented an opportunity for dedicated console and computer gamers to spend more time with new games in store. However, high penetration of smartphones has increased the demand for mobile gaming as compared to that of console games for casual gamers.
Digital distribution of games has also allowed firms to rake in bigger profit margins than selling physical copies in stores. Whereas publishers would traditionally make about $35 on a $60 game sold in-store, online downloads mean they can now make as much as $45 per game; this can increase exponentially for platform holders like Sony selling their first-party games digitally.
Sony and Nintendo have reported much higher digital download numbers this year. That trend looks likely to continue, with both Microsoft and Sony selling digital-only versions of their new consoles at lower prices.
However, the market is expected to stabilize after growing at a considerable rate in the recent years owing to customer loyalists who would keep contributing to market demand along with newly found usability of these gaming consoles in developed households owing to constant developments and innovations in the said product.
The two main key factors that are responsible for the massive growth of gaming consoles are online gaming and high performance.
Today, the gaming console realm runs the gamut from basic consoles that takes one down memory lane to ultra-portable rigs for gaming on-to-go to really powerful offerings for high-resolution HDR and virtual reality gaming.
The Xbox Series X and the PlayStation 5, the next-generation gaming consoles by Microsoft and Sony hit the shelves in late 2020 with $499.99 price tags.
Due to an influx of high demand, getting the latest Xbox and PlayStation gaming consoles almost became a significant challenge for users. The products were impossible to find in stock, either. Supply shortages for the in-demand Microsoft and Sony consoles will likely persist throughout 2021.
Nintendo’s products don’t offer the same high-powered gameplay as their all-new Microsoft and Sony rivals. However, thanks to iconic characters like Mario and Zelda, to name a couple, as well as exclusive and wildly popular titles like Animal Crossing: New Horizons, they are rightfully popular and are more affordable, too.
Nintendo reported that Switch was the top-selling gaming console in 2020, with 15.6 million units sold as of September, 65% more than Play Station 4 and Xbox combined. One of the key reasons for the Switch’s success is the popularity of Nintendo’s first-party titles.
The incorporation of the latest technology and providing additional features to the gaming consoles can boost the revenue of the global gaming market. Gaming with consoles in 2020 is becoming more like a real-life experience with fine quality in terms of both video and audio by the application of Augmented Reality and Virtual Reality.
The recent release of Sony’s PlayStation 5 and Microsoft’s Xbox Series X in late 2020 are important developments in this market
Even though its rival Xbox Series X shares similar specifications, Sony’s PlayStation 5 has more sheer power processing compared to Xbox Series X. This advantage can result in a lead even though they share the same price in the market.
Emergence of AR/VR Gaming is Expected to Drive Market Growth: The increasing application of immersive technologies, such as virtual reality, augmented reality, and mixed reality, is going to be a cornerstone for the gaming industry, where users can enhance their overall experience and make it more enjoyable and convenient than traditional alternatives. This instance is expected to drive the game console application, as VR/AR headsets will be a growth driver, as they will ultimately combine with game consoles.
To capture the growing trend in AR/VR, companies like Oculus and HTC have positioned their product offering according to the demand in the AR/VR market. Oculus offers two VR consoles, while HTC also offers two VR based consoles. The demand of the AR/VR consoles has been majorly led by the quality and quantity of the titles available on their platforms.
Evolution and adoption of Visual Display Resolutions: The majority of companies operating in the market are shifting from standard-definition television (SDTV) and high-definition television (HDTV) to advanced ultra-high-definition (UHDTV) and full-high-definition television (FHDTV).
Ultra-high-definition resolution includes 4K, DCI 4K and 8K display resolutions. Key players in the gaming console market are now developing gaming consoles enabled with UHDTV and FHDTV display resolution capabilities.
The launch of various video game consoles accessories like 4K TVs, 3D audio headphones, keyboard and others, has proven to be beneficial for the market growth of gaming consoles. These accessories offer enhanced gaming experiences to its users. Further, the adoption of other technologies including haptic vibration, Blu-ray, and wireless connectivity will further contribute to the market revenue in the upcoming years.
Rising demand for wireless and 3D gaming consoles: The rising demand for game consoles based on advanced wireless technologies, including 5.0, Wi-Fi and 5G network among others are expected to drive market growth. Key players, including Sony Corporation and others are offering gaming consoles based on wireless technologies to deliver an enriched user experience.
Moreover, the rising popularity of 3D gaming is increasing exponentially across the globe. 3D gaming consoles support stereoscopic graphic gameplays on an integrated high-resolution display. Also, 3D gaming provides features such as precise 3D localisation, which helps to improvise on the users’ experience and deliver realism to the gameplay.
Further, various drivers such as rising “massively multiplayer online gaming options” and rising global investments in video games, are expected to boost the gaming console market further. Console video game developers are adopting to subscription-based gaming.
For example, Xbox Live and PlayStation Plus provide licenses for a few games on monthly rotation basis. The first major subscription program by EA was the EA Access on Xbox One which offered discounts on EA games, a limited number of hours of pre-release play, and a vault of back catalogue offerings. This strategy in play was to built up brand loyalists who would not be willing to make a switch to their competitors’ brand by providing some exclusive content to them.
Tech Giants joining the Gaming Industry: Other tech giants in the market are stepping on gaming companies’ turf. Google, Amazon and Facebook have all released their own cloud gaming services, looking to carve out a share of the billion dollars gaming market. On the one hand, Google and Amazon are trying to compete with the likes of Steam and Epic Games as digital game distribution platforms themselves. On the other, Facebook is using game streaming as an advertising tool.
Facebook-owned Oculus released an all-in-one VR headset, Oculus Quest, which is driving market growth in the segment. Apple also launched its new video game subscription service, Apple Arcade, for US$4.99/month. Google also launched a high-performance cloud gaming service, Google Stadia. These services will enable gamers to play high-end games on the internet, without the need for expensive hardware.
This concept of cloud gaming and VR gaming do not pose a threat to the game console market in the near future as the target customers will be different. In addition, VR/AR headsets will actually be a growth driver, as they will ultimately combine with game consoles.
For now, cloud gaming is mainly seeing adoption among console gamers who want to continue playing the titles they enjoy on other devices proving to be an opportunity for tech companies of all stripes to take advantage of the growth in mobile gaming, which now accounts for almost half of the entire market
The key market players are Sony, Microsoft, Nvidia Corporation, Valve Corporation, Play Jam, Blue Stacks, Nintendo Co. Ltd., Mad Catz, OUYA Inc.
For game consoles, intense competition currently exists between Nintendo (switch), Microsoft (Xbox), and Sony (PS4). Product features, latest game release, and the price are the main areas where the vendors compete on.
Vendors, including Sony and Microsoft, have dominated the gaming console industry for a considerable time and continue to align their strategies to leverage the willingness of hardcore gamers to pay a premium on high-performance consoles. With their pricing and marketing, both companies seek to regain their dominance in the game console market with new generation products to be released in 2021.
Since there are a large number of gamers who play a vital role in influencing the gaming market, each model is released with new advanced features in order to gain a competitive edge over others.
One of the most successful products in terms of performance and sales unit was “Nintendo Switch” introduced by Nintendo. It was released during early 2017 and it gained much popularity between casual gamers who prefer to game with handheld consoles.
New updates, changes, and the addition of new features are always appreciated as they enhance the growth of the market. The audio and video experience for a user has improved each time with the release of a new product in the market.
