Why are More People Investing In The Gaming Industry?

Video Games 3

Over the years, there has been a significant rise in the number of people who consistently invest in this industry. There have also been plenty of stories reported online regarding the apparent fact that there are numerous factors positively affecting the gaming industry.

The industry continues to grow stronger. That’s why we’ll take a look at its growth dynamics, the reasons behind this growth, and the factors that will be driving it in the coming years.

1. The gaming industry market is growing rapidly

In 2021, the global gaming market was estimated at USD 173.70 billion. And there’s more room for growth, for it is anticipated to reach USD 314.40 billion by 2027.

The reason for this is people are spending more time playing video games than ever before. And with a total of 3.24 billion gamers worldwide, it is only sensible that more people are investing in the gaming industry. Since the time had passed when anyone used to think of gaming as a waste of time, it is more and more becoming evident that the gaming world would eventually be seen as one of the most significant sources of big money.

2. The revenue is generated from a new angle

It’s worth noting that video games have a starkly different pricing model than other software-based products. For instance, you must have noticed the growth of free video games like Apex Legends. While these games are entirely free to register and play, it doesn’t mean they’re not making profits.

If anything, they are significantly lucrative for the developer as well as the video game industry as a whole. Today, the gaming industry is generating most of the revenue from the high in-demand in-game items such as weapons, cars, and skins that are bought with real money. For instance, Fortnite is a free game. But the maker is nearing an estimation of about $17 billion.

The entire monetization model is based on Fortnite’s in-game products “costumes” and “skins.” More often than not, it’s nearly impossible to get ahead in the game without acquiring these extra elements. And once the player is hooked to the game, they go out of their way to make these purchases. Fortnite also earns revenue selling V-Bucks at $9.99 per 1,000, which players use to buy dance moves, skins, or accessories.

3. Growth in the number of games

With the exponential increase in the number of gamers investing in gaming PC online, we’re witnessing a surge in the number of games as well, both paid and free-to-play games. In 2020, the total number of games was estimated to be 1181019. And in 2021 alone, 3,031 new games were released on the gaming platform, Steam.

The increase in the number of games means an increase in revenue. No wonder investors are now inclined to invest and make a profit in the gaming industry.

4. High adoption of mobile gaming

The popularity of mobile gaming is setting the trend for more and more people to invest in the industry. Popular games such as Candy Crush, Angry Birds, Clash of Clans have also set a precedent and fueled the popularity of mobile gaming.

The mobile game’s revenue in the U.S. alone was estimated to be 10.73 billion U.S. dollars. And because of the technological advances and lockdowns owing to the coronavirus pandemic, mobile video game players in the U.S. are estimated to increase from 150.45 million in 2020 to 181.3 million in 2025.

The rise in the number of mobile video game players can also be attributed to the affordability, simplicity, and mobility of mobile gaming.

5. Switch to digital distribution

The Gaming industry is snowballing, and the switch to digital distribution means that the gaming community is expanding. This makes investing in the Gaming Industry a good idea as there will be more demand for new games, franchises, and technology.

For instance, gamers can buy more than 2,000 games from Steam. Since Steam is used by more than 120 million players in a month, PC gaming has benefited a great deal from Steam. Instead of releasing games to retail stores, developers use Steam to release their products. Players can then download the game directly and start playing within a few hours.

6. Rise of eSports

Not too long ago, the idea of esports was unheard of. But now, with over 220.5 million occasional eSports viewers and 215.4 million eSports enthusiasts, the industry is worth millions of dollars. eSports also has an audience of 435.9 million.

eSports is the evolution of competitive gaming in its latest form. It’s the new face of electronic sports that has been rapidly growing in popularity over the past few years. And as viewership rises, so does interest in investing and entrepreneurship. In fact, the same study suggests that the CAGR for eSports enthusiasts from 2019-2024 will be about 7.7% by 2024, and the yearly revenues will hit $1084.1 million.

7. Startups are doing well

The gaming industry is taking off, and with it, the number of start-up companies making games is growing as well. And not just in numbers, these startups are growing and scaling to new heights as well.

For instance, Chaos Karts is a kart game that offers users a complete AR experience. Founded in 2019, the start-up’s seed round was invested at an estimation of $3.53M, and 5-year search growth at 1400%.

That’s a Wrap!

The gaming industry is no longer the domain of geeks flitting from consoles to PCs. Today, almost every household must have a person who regularly plays games. In fact, more people are playing games than socializing in person, which especially holds true for the post-covid era. This is real growth, not just a fleeting trend.

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