3 Reasons Why the Digital Games Market Keeps on Booming
F2P, Cryptocurrency and Mature Gaming: Digital Games Market to Keep on Booming
Young, old, woman, man or child, people love their digital games. Whether they are played on a videogame console, computer, smartphone or tablet, games of all different genres are popular and the digital gaming industry is a booming money-making enterprise that is ever-evolving and only becoming more valuable with time.
According to Juniper Research's annual report about the games market, it is estimated that the digital videogames market will see sales surpass $100 billion this year in terms of revenue. Moreover, the renowned research firm predicts that by 2021, the video game market on mobile and PC will grow to earn $132 billion in total revenues.
F2P mobile games is the predominant reason behind revenue growth
The success of the digital gaming industry is mostly being driven by mobile gaming and, more specifically, the free-to-play (F2P) model where the game is free to download and play but extras cost money.
"Mobile gaming through app stores has completely transformed the scale and growth rate of the digital games market and is now the biggest platform category within the market by quite some margin," the director and head of games research at IHG Technololgy, Piers Harding-Rolls, told CNBC.
That being said, not all F2P mobile games are as successful at making developers money as others. For instance, Although Nintendo's Super Mario Run was hugely successful in terms of popularity, having been downloaded more than 150 million times, in terms of making a profit for the company, it was a notable flop, with less than 10% of those who downloaded it purchasing the game. The reason? No one was interested in spending the one-time $10 fee to unlock the rest of the game.
Instead, what Nintendo learned through its other major mobile franchise, Fire Emblem Heroes, is that the real money is in smaller in-app purchases. Even though this app has been downloaded only 15 million times, Nintendo has made more money from the title than Super Mario Run through its small in-app purchases that give players the chance to obtain better heroes for their army.
Cryptocurrency could be a game changer
With the rising popularity of cryptocurrencies, like Bitcoin, an increasing number of game developers may be more open to the idea of a marketplace for trading game items and characters as well as in-game currency for real money.
That said, this would be a huge break from the norm as publishers and developers typically take steps to prevent the selling of in-game currency - e.g. World of Warcraft (WoW) gold - outside the game, in order to decrease the effect on player balance and in-game economies. For instance, Blizzard (creator of WoW) has been battling against businesses for a decade to prevent the selling of WoW gold for cash.
On the flip side, Active Games is taking the opposite approach with its sword and sorcery MMORPG Lordmancer 2. Players have the option to freely (and legally) purchase and sell artefacts and weapons in-game with the Lord Coin, LordMancer 2's custom cryptocurrency, which can be exchanged for real money outside of the game.
Active Games CEO Anton Telitsyn said that they "endeavor to create a safe, transparent marketplace for trading game items and characters."
Policies are changing and gameplay is evolving among the more mature
On a more mature front, significant changes are being made in regard to the availability of Android real money iGaming apps. Google Play has recently introduced new policies on gambling apps, now permitting Android users from UK, Ireland and France to download these apps from the Play Store.
For online mobile gamblers, this means exciting online casino slots for Android from premium and reputable brands like PlayOJO, 888 Casino, BetUK and many other popular brands. Now, instead of downloading the Android apps from third party sources they can get them directly from the Google Play Store, a far more convenient and securer source. This new availability is likely to lead to more downloads and more money for the publishers.
Although gambling apps tend to be more popular among the more mature crowd, it's not just gambling that appeals to this audience. In fact, gaming among seniors is on the rise around the world. According to stats from casual gaming company, Big Fish Games, 27% of all gamers in 2015 were seniors and seniors have even started to organize gaming events, such as the National Senior Wii Bowling League.
With so many people engaging in all forms of digital gaming, there's no doubt that the market revenue can only grow from here.