ONLINE GAMING MARKET
- The global Online gaming market will be worth ~$33.6 Billion in 2020 and ~$36.2 Billion in 2025
- The world of online gaming is witnessing substantial growth with more and more user engagement now more than ever before. Novel technologies such as Virtual reality and Augmented reality have played a major role in elevating the adoption rate and popularity
- Action games and Sports games are the two most popular genres of Online gaming Market. It is likely to witness the maximum developments in terms of new gaming content and game releases owing to its popularity among audience in the long term
- Game developers are constantly trying to re-establish their position in the market by rolling out games that are compatible on more than one platform such as Xbox, PCs and mobile phones further increasing its popularity and expanding their consumer base.
- After years of uncertainty over its capabilities, 5G is a reality, and it’s proving to be a vital component of the future of mobile gaming. Thus far, China is the biggest beneficiary of 5G, although the US, the UK, have also started implementing the technology. At its core, 5G promises ten times more speed than 4G.
- Recent advances in advanced cloud technology have turned the idea of cloud gaming into reality. In cloud gaming, the server, where all the games are stored, does all the computation work, which includes game scene rendering, game logic processing, video encoding, and video streaming.
- Paytm First Games announced growth to over 80 million registered users. There has been a 200% growth in userbase and a 4X increase in gameplays in the first half of this year with over 25 million active users. During the ongoing cricket season, there was seen a rise in the number of fantasy sports players engaging on the platform.
- In the second quarter, Activision’s player base grew 30% year over year, adding more than 100 million monthly active players. Time spent in their games grew 70% over the same period, and Q2 engagement and player investment were at historic highs.
- Classic games perform the best for 7-day user retention period followed by mid core games and casual games. Most casual game genres have a decreasing retention rate after 28 days with exception of puzzle games.
- Net Bookings contribute majorly towards revenue generation for gaming publishers. Net bookings for games were witnessed to be at record highs for the year 2020.
Games have been a source of entertainment for mankind ever since. However, from tabletops to virtual reality, how we play games has changed extensively over time. Since its commercial birth in the 1950’s in the form of prototypes for video games to highly popular open-world games, Online Gaming has blossomed into one of the most profitable entertainment industries in the world today.
Online gaming means playing video games over a computer network, particularly over the internet. It can be played solo as well as in multiplayer mode. Compatible with both Pc’s and mobile devices today, Online Gaming has been a revolution in the history of games.
Many genres have been introduced in the world of gaming since its introduction, thus grabbing the attention of every individual irrespective of their age.
ONLINE GAMING MARKET DYNAMICS
Technological innovations in both hardware and software development backed with an increasing Internet penetration across the globe have majorly contributed to the evolution of the online gaming industry. Advancements in various aspects such as graphics and experience enhancements in the gaming sector have further influenced the online gaming market growth.
Novel technologies such as Virtual reality and Augmented reality have played a major role in elevating the adoption rate for such games.More and more game developers across emerging economies are looking to constantly engage and improve the gamers’ experience by launching and rewriting new codes for diverse platforms across new channels
Thus, it is leading to a fierce competition in the gaming landscape: and thus proving to be a gamers’ paradise as a counterpart.
People have much more access to the internet now than ever and that’s the reason people are spending an enormous amount of time online. So, a tablet or smartphone coupled with an internet connection is influencing the growth of the online e-gaming market.
COMPONENTS OF ONLINE GAMING
- Distributors and Retailers: Platforms that distribute and sell games
- Streaming Services: Services that allow users to livestream games
- Hardware Developers: Companies that build the electronic infrastructure required to play games
- Gaming Arenas: Venues that host gaming events
- Esports: Organized, multiplayer video game competitions, typically between professional players
- Software Developers: Develop applications that allow users to do specific tasks
- Game Publishers: Companies that finance and distribute games
- Game Developers: Studios that develop games
Impact of COVID 19 Pandemic: With the outbreak of the novel Covid19 and people stranded at home due to nationwide lockdown and travel restrictions, people have been forced to meet with their entertainment needs at home.
Online gaming industry is one of the few industries which in turn has greatly benefitted from this ban as people find ways to stay connected with their friends and family and find themselves indulging greatly into the world of online gaming. Games like PUBG and Call of duty which have the option of multiplayer gaming quickly garnered attention.
This period has seen a rise in the competitive gaming industry and with it the rise in digital sales of these online games and gaming devices, thus projecting a bright future for online gaming and its components as its demand continues to rise.
With such lucrative revenues and profitable margins, many new players have entered the market to provide for this demand, thus making it more accessible to the mass and further increasing its popularity. The use of virtual reality is constantly blurring the lines between fantasy and reality and indulging its audiences greatly.
One important factor that is hugely contributing to the rising demand for online gaming is the advent of cross platform gaming. Game developers are constantly trying to re-establish their position in the market by rolling out games that are compatible on more than one platforms such as Xbox, PCs and mobile phones further increasing its popularity and expanding their consumer base.
GROWTH IN YOUTUBE STREAMING
With the expansion of the online gaming market, the online streaming platforms have also seen an upward trend. As more and more people are indulging into online gaming, the demand for video game tutorials and play through videos has also witnessed a surge.
Several upcoming players, professional gamers and even celebrities are resorting to these platforms like Twitch and YouTube to reach out to their audiences and engage them into the world of online gaming as many audiences choose to live stream these videos proving to be a win-win situation for both.
- Felix Arvid Ulf Kjellberg, commonly known as PewDiePie was one of the pioneers in streaming and has one of the highest subscribers on the platform with over 100 M subscribers. He earned ~$13 M in revenue from YouTube.
- Daniel Robert Middleton, with his channel DanTDM is also a gaming streamer with over 24 M subscribers. He earned ~$12 M in revenue in 2019 from YouTube
This online streaming trend is expected to greatly boost the online gaming market. As per recent trends, it has also been noticed that many audiences prefer watching other players play.
To know more about YouTube streaming trends, read our report “ Global vlogging camera market”
There was a notable surge in live gaming stream recently, where notable players could showcase their gaming skills on a streaming platform such as Twitch and their fans could just sign up and watch them play. This demand for streaming services is further going to accelerate the demand and market for online gaming.
ONLINE GAMING MARKET GROWTH
Many online gaming companies are putting efforts into the development of the new games and bringing in a lot of new software updates in order to keep their customer interested in the games as they have seen enormous gaming traffic on their games.
For example, Activision Blizzard, an online gaming company released its Call of Duty: Warzone online game as free to play version, compatible across PC, and gaming console and was able to generate huge amounts of revenue on the same.
The company said that the game was downloaded about 15 million times within 3 days if its release. A considerable amount from this population consists of teenagers and school-going children who are left with very limited activities to do.
And, similar trends have been observed among other game makers companies as well. And these initiatives are the main reason for the inline e-gaming market’s growth.
COVID-19 IMPACT ON GLOBAL ONLINE GAMING MARKET
COVID-19 is one of the main reasons for a sudden boost in the demand for online e-gaming. A lot of suppressing instructions including travel restrictions and business shutdowns are contributing to the same. So, a lot of people are staying at their home and spending time online and internet traffic is generally up by 25-30% than usual.
As per one of the reports given by Nokia, online gaming traffic has also grown significantly. A report shared by a U.S telecom company Verizon says that they found that gaming traffic is increased by 75% during the lockdown enforced because of COVID-19 situations all over the globe.
NEW GAMING PRODUCTS LAUNCHED POST COVID
|COMPANY||GAME ADDITIONS ANNOUNCED||GAME GENRE||RELEASE DATE||PLATFORMS|
|Activision Blizzard||Tony Hawk’s Pro Skater 1 and 2||Adventure||September 4,2020||PC, PS4, Xbox One|
|Activision Blizzard||World of Warcraft: Shadowlands||Multiplayer, role-playing||November 23, 2020||PC, Macintosh operating system|
|Activision Blizzard||Call of Duty Black Ops: Cold War||Action||November 13, 2020||PS4, Xbox One, XSX, PS5 and PC|
|Nintendo||Hyrule Warriors: Age of Calamity||Hack and slash- Action||November 20, 2020||Switch|
|Ubisoft||Assassin’s Creed Valhalla||Action- role playing||November 10, 2020||PS4, Xbox One, PC, Stadia|
|Realmforge Studios||Spacebase Startopia||Strategy and real time||October 23, 2020||PC, PS4, Xbox One|
|Ubisoft||Watch Dogs: Legion||Action-adventure||October 29, 2020||PS4, Xbox One, PC, Stadia|
|Activision Blizzard||Crash Bandicoot 4: It’s About Time||Platform- Action||October 2, 2020||PS4, Xbox One|
ONLINE GAMING MARKET SIZE AND FORECAST
The smartphone market is growing tremendously at a significant rate which in turn is contributing to the global market globally. The online multiplayer games like Call of Duty, PUBG, CS Go have gained a lot of attention because of the social elements like teaming up with other players despite of being at different locations globally.
Electronic sports (eSports) are the tournaments planned for video game players. It’s a platform where a lot of players meet and compete with each other. Esports event includes competitive league tournaments. The Esports generate income through sponsorship and advertisements, tickets, media rights, and merchandise.
On the basis of platforms, the mobile segment witnessed the maximum contribution toward the growth of the e-gaming market and has the maximum market share.
On the basis of pricing models, the freemium segment is expected to show maximum growth and would contribute to the market over the forecasting period of 8 years. North America accounted for the highest share in the global e-gaming market. We can also find a lot of professional players in the same region.
The global online gaming market is estimated at $33.6 Billion in 2020 growing at 1.5% CAGR till 2025
Smartphone Gaming has exploded in recent years. The increase in the number of smartphone users coupled with a stable internet connection has risen quite significantly, which in turn is boosting the global online gaming industry. The online multiplayer games like that of PUBG and Call of Duty Mobile have recently become extremely popular among users due to the presence of its social elements.
People can team up with peers irrespective of their locations globally. These multiplayer formats engage their audiences by giving them the opportunity to socially interact with their peers and also give them a sense of achievement over other gamers.
In addition, the advancement of technology in this aspect and the advent of cloud gaming and virtual reality has made it possible for mixed reality features and real time user experience of gaming on a smartphone as gamers today are preferring games on mobile devices more. It gives them the option of faster gameplay thus catering to the needs of millennials for instant results and instant gratification of their needs.
The explosive growth of social media in the 21st century has further fostered the growth of the online gaming market creating more buzz and attracting new potential audiences.
Mobile gaming is thus the fastest growing segment in the online gaming market with the lowest barrier in entry and less room for delays in developing and processing due to Covid19, proving to be a more cost-effective opportunity for developers, gamers and publishers alike.
Asia Pacific region emerging leaders
Asia Pacific region is emancipated to hold the largest market share in the online gaming industry where countries such as China, Japan and South Korea show great potential in market growth.
Chinese Enterprises like that of Tencent Holdings and Nintendo are looking to take up any business opportunity in this regard and remain relevant in the industry to generate enough users’ gaze and even attract new players into the market.
The gaming industry is thus proving to be a functioning ecosystem of its own: with many collaborations and partnerships for mutual benefits. This ecosystem creates dozens of revenue streams for the industry as a whole and great opportunities for growth.
ONLINE GAMING MARKET COMPETITIVE LANDSCAPE
The online gaming market is highly fragmented as the demand for online games and rising penetration of smartphone usage across various regions is catering to an intense rivalry in the market.
Key players in the market include Microsoft Corporation, Nintendo Co. Ltd, Valve Corporation, Electronic Arts Inc, Activision Blizzard Nintendo, Microsoft Corporation., Rovio Entertainment, NVIDIA Corporation; Valve Corporation; Playjam Ltd.; BlueStack System and Sony Corporation etc.
These companies are largely focusing on building and developing more engaging gaming content and next generation gaming experiences.
Market players are significantly emphasizing on improving customer experiences by offering innovative products with multi-utility features like real time personalization and cloud gaming thus providing vast opportunities for different brands and advertisers to tap into this lucrative market.
Copyright and piracy issues are going to impact market growth in a negative way. The issues related to frauds while playing games like hackers are going to impact the growth of e-gaming markets in a negative way as well.
Zynga’s revenue depends on its continued ability to publish their games on mobile platforms, primarily Apple’s iOS and Google’s Android. In 2019, Zynga derived 50% of its’ revenue and 49% of its’ bookings through Apple and 43% of its’ revenue and 46% of their bookings through Google.
THE WAY FORWARD IN ONLINE GAMING MARKET
Several companies such as Onlive, G-Cluster, StreamMyGame, Gaikai, and T5-Labs are already offering commercial cloud gaming services. This new sector is also seen as a serious competitor for the traditional game market.
Some of the popular consoles developed by these companies are XBOX One by Microsoft corporations, PS4 (Play station 4) and Wii U by Nintendo Co., Ltd. And these market players are focusing on delivering to the customers is product differentiation and innovation with a view to increasing their market share.
With the competitive market and a lot of big players in the market offering a fruitful experience to their customers with games like PUBG, Call of Duty and others the E-gaming market is expected to grow tremendously in the coming years.
|2||Scope of the report|
|7||Insights from Industry stakeholders|
|8||Cost breakdown of Product by sub-components and average profit margin|
|9||Disruptive innovation in the Industry|
|10||Technology trends in the Industry|
|11||Consumer trends in the industry|
|12||Recent Production Milestones|
|13||Component Manufacturing in US, EU and China|
|14||COVID-19 impact on overall market|
|15||COVID-19 impact on Production of components|
|16||COVID-19 impact on Point of sale|
|17||Market Segmentation, Dynamics and Forecast by Geography, 2020-2025|
|18||Market Segmentation, Dynamics and Forecast by Product Type, 2020-2025|
|19||Market Segmentation, Dynamics and Forecast by Application, 2020-2025|
|20||Market Segmentation, Dynamics and Forecast by End use, 2020-2025|
|21||Product installation rate by OEM, 2020|
|22||Incline/Decline in Average B-2-B selling price in past 5 years|
|23||Competition from substitute products|
|24||Gross margin and average profitability of suppliers|
|25||New product development in past 12 months|
|26||M&A in past 12 months|
|27||Growth strategy of leading players|
|28||Market share of vendors, 2020|
|30||Unmet needs and opportunity for new suppliers|