The rise of the digital games industry is fueled by the increasing broadband penetration and the convenience of gaming on mobile devices. It also complements marketing strategies for publishers by allowing constant messaging and new feature introductions. This allows for the wide availability of games and enables gamers to play anywhere, any time.
Mobile phones and tablets provide more portability and accessibility than traditional game consoles. Games can be downloaded on these devices and players can take their favorites with them wherever they go. A recent report from SuperData forecasts that the global interactive entertainment industry will grow by 2% in 2021, reaching $142 billion. In addition, subscription streaming services will provide year-round revenue generation, thereby eliminating storage and manufacturing costs.
There are four primary categories in the digital games industry: premium, free-to-play, mobile, and gaming as a service. Premium games include those that are played on consoles or PCs. Free-to-play games are typically found on mobile devices. These games often introduce opportunities for monetization.
Mobile gaming is estimated to be the fastest-growing segment of the overall gaming industry. With more people using their mobile devices to play games, the total spending is expected to increase by 10% in 2020. Additionally, the number of active mobile gamers will surpass the number of active PC gamers for the first time.
Mobile gaming revenues grew to $73.8 billion in 2020, bringing the total digital gaming market to 58% of all gaming revenues. This is largely due to the growth of mobile phones, which account for 89% of all digital gamers.
In the early 2000s, most gamers were accustomed to buying games from physical stores. However, a rise in the internet and high-speed broadband connections changed the way games were delivered. Since then, the prominence of digital distribution has increased.
Several tech companies have seized on the opportunity to upend the home video and gaming industries. Netflix, Amazon, and other companies offer streaming services that allow users to enjoy television shows and movies on their smartphones. Likewise, Nintendo responded to the rising interest in old Nintendo video games with the release of the Switch, which is a hybrid gaming console that lets users enjoy their favorite classic games on the go.
Gaming companies like Sony and Microsoft continue to evolve and expand their portfolios. Sony introduced full game downloads for its PlayStation 3 in 2009. Meanwhile, Microsoft launched a service for downloading full versions of its games in 2009.
Gaming consoles and PCs have seen their popularity decline since the advent of the digital era. In the US, physical game sales account for just 17% of all game revenues. Despite this, the digital games industry remains highly lucrative, and the industry is expected to continue to grow. In addition, the gaming industry has a diverse demographic, including older generations and younger gamers.
The video game industry is expected to continue to grow, with revenues expected to reach $219 billion by 2024. The industry also expects a surge in new entrants. New products and geographical development will also help maintain its presence.