We can all agree that the video game industry is hugely profitable, and it’s a major part of modern entertainment. Thanks to the advancements in technology and a solid place within pop culture, the gaming industry has now gone beyond both the film and sports industries in regards to reach and revenue. Of course, this isn’t something that happened overnight, and video games have been part of our entertainment culture for close to five decades. This became even more prominent with the invention of smartphones, as video games are now available to everyone, everywhere and at any time.
In fact, according to Exploding Topics, 39% of the world’s population played video games in 2022. This figure is expected to grow in recent years, with a 3.11% increase expected in 2023. A lot of the world’s gaming population comes from Asia, where there are more players than Europe and America combined. This has led to the Asia-Pacific (APAC) region accounting for 42% of the gaming industry's total worldwide revenue.
The Reasons Behind the Gaming Industry’s Growth
One of the big driving forces behind the gaming industry’s growth is technological advancements, as the world has gone from having no electronic devices, to video games being available on computers, smartphones, tablets and a whole host of other appliances. This growth has been further boosted by cloud computing, which means that all gamers need is an internet connection to play some of the top games on the market. However, there are still parts of the video game market that need to be consolidated. For example, Google Stadia has shown that some platforms are struggling to find their place in the industry somewhat.
According to a report from Newzoo, $2.28 billion was spent on cloud computing throughout 2022, and this is expected to generate revenue of $8.5 billion in 2025. There’s also a lot of growth happening as far as XR experiences are concerned, with 2022 boasting a player base of 27.7 million and $1.8 billion in revenue. This is largely due to the fact that VR headsets and devices are now more accessible and affordable. The same Newzoo report also states that the mobile gaming sector garnered a revenue of $92.2 billion in 2022, which is half of the worldwide gaming market’s total revenue. Though this was a 6.2% decrease from 2021, it’s still a significant number and this small drop is unlikely to affect the gaming market in a significant way.
The Changing Face of Video Gaming
Previously, video games have been a largely male interest, but successful marketing efforts have led to a more balanced market. Now, according to Exploding Tactics, 45% of gamers are female. This shows that video games are now reaching a universal market, and how much the gaming market has changed over the years. Plus, people of all ages are now starting to embrace video games. Though an unsurprising 80% of gamers are adults, 7% are actually aged 65 years old and above, which is a far cry from the assumption that video games are for kids.
There is also a large focus on gaming subscriptions and services, with 52% of gamers in the US having subscribed to at least one gaming service. Considering the price of these subscriptions, it’s easy to see how the video game market is capable of generating such impressive revenue in 2023.