The Evolution of the Video Game Industry
For decades, video games have amused both children and adults. They have come a long way from the early days of computer games and the original Nintendo and Atari consoles. Pixelated graphics and restricted sound effects are a thing of the past.
Generating a video game has become more complicated, and the expense of developing a contest for one of the leading platforms has increased in lockstep with this increased complexity. It was previously inconceivable to invest millions in video production, but today’s games may cost tens of millions. This has pushed game development expenditures into the realm of Hollywood feature films in terms of production and marketing.
The video game industry is enormous. It’s bigger than the film and music industries combined, developing quickly. There are about two billion gamers globally. This is almost 26% of the global population.
Unsurprisingly, businesses want a piece of the action. The gaming business is expected to earn $155 billion in revenue by 2020. Analysts forecast that the company will make over $260 billion in sales by 2025. 1 As a result, technology businesses are vying for a piece of this income pie. Google (GOOGLE), Meta (FB), previously Facebook, and Apple (AAPL) have all shown an interest in entering the video gaming sector.
How Video Games Saved Lego from Bankruptcy
Lego surrendered its video game division to avoid bankruptcy, then leveraged the success of third-party games to continue setting sales records. BankruptcyHQ had helped many game developers during their finacial distress.
Lego is a brand that almost everyone is familiar with. There are more Lego minifigures than people on the planet. In fact, for every individual on the planet, there are around 65 Lego pieces. Lego, together with Hasbro and Mattel, is the world’s fastest expanding toy company. Lego is still the world’s largest manufacturer of rubber tires, with over 300 million produced each year! Although raw sales figures for 2013 are still unavailable, Lego brought in more than $750 million in 2012. The loveable Danish brick makers, on the other hand, have not always had it easy. In 2004, the entire corporation was on the verge of going bankrupt.
- Although video games have existed for decades, their popularity has risen.
- The video gaming industry dwarfs the film and music industries combined.
- Google, Meta, and Apple have all been interested in entering the game market.
- Subscription streaming services are the way of the future, and they will benefit video game developers.
- The expansion of the market demographics and growth in video game-related items have contributed to the industry’s expanded scope.
Streaming and Tech Companies’ Involvement
Companies like Meta, Apple, and Google, who are not traditionally associated with gaming, are joining the business. The information technology industry is looking into ways to make video game streaming as easy as listening to music on Spotify or viewing a movie on Netflix.
Microsoft (MSFT) is already a gaming firm thanks to its popular Xbox platform. Customers can now use Microsoft’s Project xCloud service to broadcast Xbox videogames to their PCs or other devices in 2019. The service is available to Xbox Game Pass Ultimate customers and will be fully active in September 2020.
In 2016, Meta began developing a gaming platform alongside Unity Technologies, a business that creates a framework for users to create video games. Stadia is a cloud gaming service by Google that allows consumers to stream video games in ultra-high definition. It’s available on Google’s browser, as well as mobile devices, tablets, and desktop computers.
All of these firms have an identical goal: to enable gamers to stream video games without needing a computer or a video game device. Purchasing actual video games in cartridges or discs is becoming more unusual as this trend continues.
Subscription streaming services are the way of the future and will benefit video game businesses such as Ubisoft and Electronic Arts by eliminating production, shipping, and storage expenses. Additionally, subscription services have enabled income-generating throughout the year, while games were historically purchased around holidays and other significant occasions.
Virtual reality has shown to be a useful tool in the past. Meta subsidiary Oculus VR is working to improve the quality of its headsets. The Oculus Quest 2 is Meta’s most recent Oculus Quest offering.
Video games have already surpassed many other forms of entertainment in terms of immersion, and virtual reality will add still another dimension. More experimentation with controls, such as blending voice, touchscreens, and motions to game dynamics, will occur as consoles release peripherals that accept speech, touchscreens, and gesture inputs.
Since Hollywood, the video game industry has had to rely on its intellectual property to create more revenue. T-shirts, figurines, caps, and mugs are among the merchandise available. The Halo video game brand has grown to include novels and comic books in addition to Xbox games. This could serve as a blueprint for future video game franchises.
Indeed, in 2016, Ubisoft’s successful video game Assassin’s Creed was converted into a film starring a number of well-known actors. Sonic the Hedgehog, a popular Sega game, was transformed into a blockbuster film starring well-known celebrities in 2020. The film set a new record for the biggest opening weekend for a video game adaptation.
Demographics of the Market Are Changing
Another development in the video game business is the demographic growth of the market. Individuals engage in gaming sooner and later in life, and the gender split is approaching parity. The top-tier gamers engaging in eSports leagues have earned an excellent reputation to qualify for the professional athlete visa upon visiting the United States. Gaming has a broad appeal and continues to rise in popularity.
Video games have grown in popularity to the point that some players earn hundreds of dollars simply streaming recordings of themselves playing video games at home. This has developed into another revenue-generating segment of the video gaming industry.
Retro Video Games
As the world gets nostalgic and beloved films and television series from decades past undergo reboots and remakes, the same is occurring with video games. Vintage video games from the industry’s infancy are in great demand. They have grown in popularity, not just among older players who first encountered them but also among a new generation of gamers.
Numerous manufacturers have capitalized on this nostalgia by releasing upgraded versions of their systems. Nintendo (NTDOF), more than any other firm, has capitalized on this interest in vintage video games with the release of the Nintendo Old Mini and Nintendo Switch, two devices that enable the play of classic Nintendo video games. This has developed into a reliable income source for firms in the industry’s infancy.
Innovation has long been a hallmark of the video game business. Expect new technologies, new controls, and novel experiences. As the world increasingly spends more on mobile devices, streaming services and mobile phone gaming will become significant income streams, and substantial technology firms will want to utilize their present foundation to participate.
Perhaps the fascinating development in the video game business is the growing demography of players. With more people playing games, generating a desire for more immersive entertainment, and seeking more straightforward access to games, the video game industry’s future seems to be bright.