Start of the 9th console generation, cloud gaming, XR and eSports
2019 is a transition year as the 9th home console generation looms. Sony and Microsoft will both be launching a new console at the end of 2020. For this hardware, the challenges will be around distribution dematerialisation and cloud gaming. Mobile has become the largest video game market segment in value.
Confirmation that the industry is in good shape against a backdrop of global transition
On a global scale, video game sales will have generated nearly 115 billion EUR in revenues (close to 130 million USD) in 2019. This is up 11.3% from 2018. Mobile remains the leading market segment in value accounting for 44.9% of revenues. Thanks to the growth of digital stores, revenues from console game sales are on an upward growth trajectory (27.4% of revenues in 2019). Accounting for 23.5% of revenues in 2019, PC game sales remain the third largest segment.
Two of the three 8th gen consoles are coming to the end of their cycle. New consoles will launch between 2020 and 2021. This is an opportunity for stakeholders in the publishing, development and technology solutions sectors to revisit their partnership strategies, production schedules and investment for the coming years.
Mobile gaming dominates the market
Global video game market growth by segment
Imminent launch of Stadia and more to come
Several major tech and web players want to invest or reinvest in the video games sector. Google is launching Stadia, an unlimited-access multiscreen subscription service for streaming video games. There’s a new dynamic surrounding the third generation of streaming technologies (otherwise known as “cloud gaming” or “games on demand”), which will impact game developers and publishers. Competition between console manufacturers is heating up. Sony has lowered the price of its PlayStation VR service (700,000 subscribers as of late 2019), while Microsoft has announced over 50 games for its future Xcloud service. Meanwhile, the French company Blade has raised 30 million EUR to continue developing its Shadow service.
Apple has announced Apple Arcade, an unlimited-access multiscreen subscription service for games playable online and offline. Apple has reiterated its plans to develop services for video games.
Asia-Pacific still number one
Regional breakdown of the global video game market, 2019 – 2023
Success for immersive technologies is finally coming
Immersive technologies, also known as XR or artificial reality technologies, seem to be heading for widespread adoption. Games in virtual reality, augmented reality and mixed reality are getting better and better. This new segment of the video game market is an attractive growth driver for video game developers and publishers. A significant number of them are now working on it and developing their content for the 20 million consumer headsets sold worldwide in 2019.
Other than the rollout of cloud gaming and immersive technologies for homes, eSports is proving to be in good economic shape and is enjoying success with the media and younger generations. It continues to develop and is giving rise to new technological and industrial challenges and business opportunities for stakeholders in the value chain.