Video games and digital PC gaming set to boom this year and beyond, says Research and Markets
The global markets for video games and PC games are set to grow significantly, from US$197.54bn (approx. €182bn) in 2021 to US$226.97bn (€209bn) in 2022 and from US$9.19bn (€8.48bn) in 2021 to $10.80bn (€9.96bn), respectively, with compound annual growth rates of 14.9% and 17.5%.
The research organisation says growth in both market segments is mainly due to the companies rearranging their operations and recovering from the COVID-19 impact, which had earlier led to restrictive containment measures involving social distancing, remote working, and the closure of commercial activities that resulted in operational challenges.
The video games software market is expected to reach US$380bn (€351bn) in 2026 at a CAGR of 13.8%.
The digital PC games market is expected to reach US$19.33bn (€17.84bn) in 2026 at a CAGR of 15.7%.
Drivers for growth
According to Research and Markets, other big drivers in the video game software market included rapid growth in emerging markets in the forecasted period. Recovering commodity prices, after a significant decline in the historic period, is further expected to aid the market growth, says the report.
Additionally, emerging markets are expected to continue to grow slightly faster than the developed markets in the forecast period. Stable economic growth is expected to increase investments in end user markets, thereby driving the market during forecast period.
Where the digital PC games market is concerned, increasing demand to avail PC games digitally is contributing to the growth of the market, the report says.
The advantage of convenience, cross-buying, and ease of storage that are provided by digital distribution impel the players to access the access PC games digitally. The gamers can obtain pre-loaded games when they are pre-ordered and will have immediate access to the games the moment they are launched in the market.
According to a survey conducted by GameIndustry.biz along with Ipsos, 30% of respondents considered buying digitally due to the low price that is being offered and 20% bought them for a discount. 15% responded that they will have access to the games as soon as they see it on any other platform and 7% responded that they would pre-order to get access to the games when it is launched in the market. The increasing demand for digital distribution will drive the digital PC games market.
The emergence of cloud gaming is another major trend in both the video games market and the digital PC games market.
Many video game developers, including major companies such as Activision and Blizzard Entertainment, provide their content through a subscription-based model, and are allowing customers to purchase additional content or features through micro transactions. This includes new in-game items, weapons, clothing, or other gear for the player’s character along with in-game currency and rewards.
This business-model is said to provide a continuous revenue stream for the gaming companies instead of limiting the revenues to one-time purchases.
Cloud gaming in the PC gaming world, meanwhile, is a disruptive platform where the provider runs the game on its servers and then streams back the display and expands the users for premium games. The advantage of streaming games from the cloud increases the number of users for digital PC games as it eliminates the need for upgrading hardware. For instance, in November 2019, Google has launched Stadia, a cloud gaming service capable of streaming video games in 4K resolution at 60 frames per second, in 14 different countries with 22 games during the launch.
Asia Pacific region leads global market
Asia Pacific was the largest region in the global video game software market in 2021. North America was the second largest region in video game software market. The regions covered in the video game software market are Asia-Pacific, Western Europe, Eastern Europe, North America, South America, Middle East and Africa.
Piracy a problem
The piracy of digital PC games is a major hindrance to growth, Research and Markets claims. For instance, Irdeto disclosed that there were 355,664 torrent downloads of a major sports title on pay-to-play (P2P) network.
This brings in a potential loss of over US$21m (€19.37m), the analyst reports. Piracy is a major threat in the digital PC games industry if the games are compromised within two weeks of their launch and burden with huge revenue losses. The piracy of digital PC games is thereby an obstacle to the market.
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