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Global Digital Gaming Market
2018 - 2023
MARCH 2019
|
Table of Contents
2
Chapter 2
Introduction
 2.1. Market Definitions
 2.2. Different business models
 2.3. Distribution channel analysis: Big four companies
Chapter 3
Global Digital Gaming Market Overview
 3.1. Market overview
– Global market revenue (USD Bn)
– Global projected market revenue (USD Bn)
– Geography-wise market revenue (USD Bn)
 3.2.Global trends
Chapter 1
Executive Summary
 1.1. Market scope and segmentation
 1.2. Key questions answered in this study
 1.3. Executive summary
GLOBAL DIGITAL GAMING MARKET
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Table of Contents
Chapter 4
Global Digital Gaming Market – Based on Region
 4.1. North America
– Overview
– Drivers
– Challenges
– Trends
 4.2. Asia-Pacific
– Overview
– Drivers
– Challenges
– Trends
3
Chapter 4 (Cont.)
Global Digital Gaming Market – Based on Region
 4.3. Latin America
– Overview
– Drivers
– Challenges
– Trends
 4.4. Europe Middle East and Africa (EMEA)
– Overview
– Drivers
– Challenges
– Trends
Chapter 5
Global Digital Gaming Market – Based on Platform
 5.1. Global digital gaming market overview – Based on platform
 5.2. Global mobile games market
– Drivers
– Challenges
 5.3. Global console games market
– Drivers
– Challenges
 5.4. Global PC games market
– Drivers
– Challenges
GLOBAL DIGITAL GAMING MARKET
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Table of Contents
Chapter 6
Major Platforms Overview – By Region
 6.1. Major platforms – North America
– Revenue contribution
– Key highlights
 6.2. Major platforms – Asia-Pacific
– Revenue contribution
– Key highlights
 6.3. Major platforms – Latin America
– Revenue contribution
– Key highlights
 6.4. Major platforms – EMEA
– Revenue contribution
– Key highlights
4
Chapter 7
Huge Opportunity Zones
 7.1. eSports
 7.2.Blockchain gaming
 7.3.Cloud gaming
 7.4.Virtual reality, augmented reality, and mixed reality
Chapter 8
Competitive Landscape
 9.1. Activision Blizzard
– Company snapshot
– Key numbers
– Major game titles
– Initiatives
– Growth strategy
 9.2. Electronic Arts
– Company snapshot
– Key numbers
– Major game titles
– Initiatives
– Growth strategy
GLOBAL DIGITAL GAMING MARKET
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Table of Contents
Chapter 8
Competitive Landscape
 9.3. Take-Two Interactive
– Company snapshot
– Key numbers
– Major game titles
– Initiatives
– Growth strategy
 9.4. Ubisoft
– Company snapshot
– Key numbers
– Major game titles
– Initiatives
– Growth strategy
5
Competitive Landscape
 9.5. Zynga
– Company snapshot
– Key numbers
– Major game titles
– Initiatives
– Growth strategy
 9.6. Tencent
– Company snapshot
– Key numbers
– Major game titles
– Initiatives
– Growth strategy
Competitive Landscape
 9.7. GungHo Online
– Company snapshot
– Key numbers
– Major game titles
– Initiatives
– Growth strategy
 9.8. Nintendo
– Company snapshot
– Key numbers
– Major game titles
– Initiatives
– Growth strategy
GLOBAL DIGITAL GAMING MARKET
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Table of Contents
Competitive Landscape
 9.9. Sony Corporation
– Company snapshot
– Key numbers
– Major game titles
– Initiatives
– Growth strategy
 9.10. Microsoft Corporation
– Company snapshot
– Key numbers
– Major game titles
– Initiatives
– Growth strategy
6
Major Players Foraying into the Gaming Market
 Google
 Facebook
 Amazon
Chapter 9
Gaming Start-ups and Disruptors
 10.1. Chopup
 10.2. Omnidrone
 10.3. Piranha Games
 10.4. Nazara Technologies
 10.5. Witching Hour Studios
 10.6. Touchten Games
 10.7. Steel Wool Studios
 10.8. Playsnak
 10.9. Flying Mollusk
 10.10. Lucid Sight
 10.11. Ironhide Game Studio
 10.12. NGD Studios
GLOBAL DIGITAL GAMING MARKET
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Table of Contents
Gaming Start-ups and Disruptors
 10.1. Chopup
 10.2. Omnidrone
 10.3. Piranha Games
 10.4. Nazara Technologies
 10.5. Witching Hour Studios
 10.6. Touchten Games
 10.7. Steel Wool Studios
 10.8. Playsnak
 10.9. Flying Mollusk
 10.10. Lucid Sight
 10.11. Ironhide Game Studio
 10.12. NGD Studios
 10.13. Google and Facebook
7
Chapter 10
Conclusion
 10.1.Conclusion
Chapter 11
Appendix
 11.1. List of tables
 11.2. Research methodology
 11.3. Assumptions
 11.4. About Research On Global Markets
GLOBAL DIGITAL GAMING MARKET
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Executive Summary I
8
Overview
 The global digital gaming market is one of the most thriving sectors in
the global media and entertainment industry.
 The market is forecast to experience significant expansion, at a CAGR of
XX%, and will reach USD XX Bn by 2023
 The mobile gaming segment is the largest, having generated USD XX Bn
in 2017, followed by console and PC games
 The overall market trend shows a shift from brick and mortar stores
towards more digital purchases
Drivers
 Technological advancements and shift of network from 2G to 4G will
lead to an increase in digitally-downloadable games, and other live
games of the MMO and eSports genres
 The increasing prominence of cross-platform games and 3D games is
boosting the global digital gaming market
 The number of smartphone users are expanding at a significant rate,
which in turn is boosting the mobile gaming market globally
– The proliferation of smartphones and tablet PCs is giving a
considerable thrust to the global gaming market
Trends
 Game development companies are increasingly considering digital
distribution as the preferred distribution channel as compared to
physical distribution channels
– Digital distribution allows gamers to purchase and download digital
content for different gaming platforms
 Increasing adoption of eSports, especially in the Asia-Pacific region, has
bolstered growth of the gaming industry
– Currently, eSports is one of the areas in which gaming companies are
willing to make significant investments, since the eSports market’s
revenue increased by more than four times between 2013 and 2016,
and could almost triple by 2021
Challenges
 The investment crunch is one of the factors posing a challenge to the
mobile gaming industry
– In the absence of funds, mobile gaming-based start-ups have limited
access to infrastructure and talent
 The biggest problem that the gaming industry faces is the need for
creation of new content to keep existing audiences engaged
 Securing users constantly is essential for gaming companies to ensure
that their earnings do not dip
– Gaming experts say that the industry has reached a position where
almost all possible genres and methods of gameplay have been
explored
GLOBAL DIGITAL GAMING MARKET
XX
XX
XX
XX
XX
XX
XX
XX
264.9
0.0 50.0 100.0 150.0 200.0 250.0 300.0
2015
2016
2017
2018
2019
2020
2021
2022
2023
Global Digital Gaming Market Revenue (USD Bn)
Source: Netscribes Analysis
GLOBAL DIGITAL GAMING MARKET
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Executive Summary II
Segmentation Based on Region
 The digital gaming market is segmented based on region: North
America, Asia-Pacific, Latin America, Europe, the Middle East and Africa
 APAC is forecast to contribute XX% of the total revenue of the digital
gaming market in 2023
 APAC is expected to witness the highest growth rate through the
forecast period of 2018-2023
 Most of APAC’s growth is to come from China, a region where mobile
gaming is becoming increasingly popular
 Mobile gaming is the dominant form of gaming in the Latin American
region
 The mature market of North America is expected to see console games
as the largest segment
9
Segmentation Based on Platform
 The digital gaming market is further segmented based on platforms:
PCs, mobiles, and consoles
 The mobile gaming segment was the largest, with a market share of
XX% in 2017, and will be expanding at the highest CAGR of 23.1% (2018-
2023) among the three
– The market is driven by revenue from advertisements, affordability
of mobile phones in emerging markets, proliferation of the Internet,
and low entry barrier costs in gaming
 The console gaming segment is expected to be the second-largest one
in the gaming market
– It will be driven by the launch of next-generation consoles and
expanded digital purchases
 Research On Global Markets’ analysis predicts a considerable shift from
PC gaming, to mobile and console gaming
– The market share of PC gaming has witnessed a fall over the years as
the market is restrained by factors like piracy, high cost of gaming
PCs, etc.
Competitive Landscape
 In the competitive landscape, ten major gaming companies have been
profiled:
– Activision Blizzard
– Electronic Arts
– Take Two Interactive
– Ubisoft
– Zynga
– Tencent
– Nintendo
– GungHo Online
– Sony Corporation
– Microsoft Corporation
 The prominent trends among the top companies are adoption of
eSports, Virtual Reality (VR), and digital distribution of games
 The growth strategies of the companies include organic expansion to
develop older games and improve their relationship with customers
– Also, inorganic expansion by way of acquisitions help companies
venture into segments like mobile games, and technologies like AR,
VR, etc.
 A snapshot of eight new-age gaming start-ups - Chopup, Omnidrone,
Piranha Games, Nazara Technologies, Witching Hour Studios, Touchten
Games, Steel Wool Studios and Playsnak, Flying Mollusk, Lucid Sight,
Ironhide Game Studio, and NGD Studios - is given, along with their
funding information, initiatives, and recently-released games
GLOBAL DIGITAL GAMING MARKET
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Global – Market Trends
Digital Distribution
 Delivering games digitally, instead of distributing the same via
retail/physical channels, is the most prominent trend now
 In digital distribution, the barriers to entry are significantly low
– Big gaming companies have created their own platforms for digital
distribution, likes Steam, Origin, and Xbox Live Marketplace, using
which, gamers purchase and download digital content for different
gaming platforms
10
Change in Gaming Devices
 Another key trend in the industry is the evolution of
gaming devices
 Mobile games are quickly gaining popularity, since more gamers are
turning to their smartphones and tablets for entertainment, thereby
facilitating digital distribution
 Entry barriers in the mobile gaming industry are lower than other
platforms
 As a result, major companies are investing in mobile games. In 2016,
Activision Blizzard completed the acquisition of King Digital
Entertainment to expand on its opportunities in mobile gaming
Use of Communication Software
and Virtual Credits
 Games are now being equipped with messaging and video applications
to allow smooth communication ‘in between’ games, across players
 Developers are currently focusing on monetizing content, by enabling
virtual credit systems for the sale of downloadable digital content
within games, or 'in-game purchases' like buying new avatars, and
purchase of extra levels, among others
GLOBAL DIGITAL GAMING MARKET
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Global – Market Trends
Adoption of eSports
 eSports is a form of competitive video gaming where players compete
with each other in an online or live environment for a large number of
viewers
 The most common genres of video game associated with eSports are
real-time strategy, combat, first-person shooter (FPS), and multiplayer
online battle arena (MOBA)
 Currently, eSports is one of the major areas that gaming companies are
willing to invest in, since revenue from this market grew by more than
four times between 2013 and 2016, and might almost triple by 2021
11
Adoption of AR and VR Technologies
 AR and VR are new but essential trends in the gaming industry, and it is
actively being made available to customers at affordable prices
 VR is more about having a great gaming ‘experience’ rather than just
playing a game
 This leaves room for speculation with regard to how successfully VR will
be able to convert hours of dedicated game-playing into a more
immersive gaming experiences
 On the other hand, AR technology is easily implementable, and its
success is visible from the popularity of Pokémon Go and Night Terrors
Women and Non-Millennial Gamers
 There has been an enormous rise in the number of female gamers.
Since 2010, female gamers have made up around half of all global
gamers
 In the U.S. - a leading gaming region - the average age of gamers is 37
 Also, 31% of the video game-playing population comprises adult
women, while only 18% of the gaming population are boys of ages
below 18
GLOBAL DIGITAL GAMING MARKET
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2017
2016
2015
2017
2016
2015
2017
2016
2015
2017
2016
2015
ActivisionBlizzardElectronicArts
TakeTwo
InteractiveUbisoft
Distribution Channel Analysis
12
With the dawn of the broadband Internet era, the landscape of
game distribution channels has changed over the years
 Major gaming companies like EA, Take-Two, Activision Blizzard
and Ubisoft are increasingly shifting towards the digital
distribution channels, from the retail distribution channels
Clearly, digital distribution is a common growth strategy for top
players
 It allows companies to make their products available to
consumers at minimal costs, thereby, drastically lowering the
total cost of developing video games
Video game producers are focusing more on story and content
development, without worrying about incurring massive costs on
distribution channel intermediaries
Gaming companies are also launching titles which were previously
available only on PCs and gaming consoles
 Games such as FIFA, Madden NFL, The Sims, SimCity, and Star
Wars are available across mobile platforms and even as free,
downloadable versions for PCs
In addition to developers and publishers, digital distribution
benefits consumers by enabling them to buy/play the games
online without having to purchase it through any retailer
(online/B&M)
 They can download games directly through websites like Steam,
Origin, and others
Revenue from the retail
distribution of games for the four
major companies has declined,
and digital distribution channels
have gained prominence. In 2015,
revenue from both channels of
distribution were almost equal,
while in 2017, it became clear that
the future of the market was in
games downloaded over the
Internet, and not so much in
games bought via retailers
Distribution Channel Analysis : Four Major Companies
Retail Digital
Source: Annual reports of the stated companies
GLOBAL DIGITAL GAMING MARKET
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XX
XX
XX
XX
XX
XX
XX
XX
XX
Mobile Console PC
13
Mobile
 Mobile games was the largest segment of the
2018 global digital gaming market, accounting
for XX% of the revenue
 This segment is expected to expand at a CAGR
of XX% during the 2018-2023 period, and is the
fastest-growing segment, globally
 By 2023, the mobile gaming segment is
forecasted to hold on to largest market
share
Console
 Console games came after the mobile gaming
segment, with a revenue share of XX% in 2018,
generating USD XX Bn
 By 2023, revenue from the console gaming
market is forecast to reach USD XX Bn
2015
Market share of various platforms (2015, 2018, and 2023)
PC
 The PC games segment is next, but is expected
to experience a negative growth rate during
the forecast period (CAGR of XX%)
 Research On Global Markets’ analysis says that
PC gaming is likely to become the least
preferable form of gaming in the years to
come. The market revenue from PC gaming is
forecast to come down to USD XX Bn
2018
2023
GLOBAL DIGITAL GAMING MARKET
Global Digital Gaming Overview – By Platforms
Source: Netscribes Analysis
|
Global Console Games Market Overview
The first generation of console games were introduced in
the 1970s and had several hardware shortcomings like
lack of an audio port, etc.
Consoles have come a long way since then and have become much more than a
simple gaming device.
High-end devices like Xbox, PlayStations, and Wii Switch have 3D graphics, Internet
connectivity, online playing options, and movie-watching features.
Despite high purchase costs, and increasing competition from the mobiles segment,
launch of next-generation consoles and expanded digital purchases on the same will
drive the market forward.
14
XX
XX
XX
2015 2018 2023
Console games - global revenue (USD Bn)
Source: Netscribes Analysis
GLOBAL DIGITAL GAMING MARKET
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Global Console Games Market Overview
Drivers
Launch of new generation console
 The global console market is influenced significantly by the launch of next-generation gaming consoles
 The major vendors in this segment are Sony, Microsoft, and Nintendo. The last generation of consoles were
released in 2013, and since then, the global console games market has seen a decline, since the market has
reached its saturation point
 Gamers want upgrades in console technologies, and they look for enhanced audio-visual experiences while
gaming through consoles
 Thus, the launch of next generation consoles will propel the market
Increase in micro transactions/digital purchases on consoles
 Mirroring the global gaming market trends, increased digital purchases on consoles will drive the growth of
console games
Advanced technology and features
 Use of advanced technology in consoles acts as a significant driver for console games
 New consoles come with better RAM, processing units, motion sensors, and Internet connectivity
 Live video streaming via Netflix, YouTube, etc., watching DVDs/ Blu-rays, online game playing, browsing the
Internet, among others, make these the preferred consoles, as opposed to traditional ones
15
Challenges
Competition from mobile and social gaming
 People are shifting to mobile gaming for its ease of access and affordable pricing. Since 2007, mobile apps have
become more popular
 Meanwhile, serious gamers are shifting to PC-based games. All these put together, have resulted in the
contraction of the market size for console games
High cost
 High initial investment on consoles (which has no alternative use apart from gaming/ browsing) creates a
problem with regard to penetration in developing economies like that of APAC, where disposable income is less
in comparison to developed regions like North America and Europe
 Since gaming/ browsing can be done using PCs/mobile devices, consumers do not usually invest in a dedicated
gaming device like a console
Inability to adopt eSports
 eSports is an emerging trend in the gaming industry. Compared to PC gaming, consoles have limited
penetration in the eSports market
 Console games have a small share in popular eSports genres like fighting and sports, and in that little share, the
emphasis is more on one-on-one gaming instead of MMO. This acts as a significant deterrent for the growth of
eSports on consoles
GLOBAL DIGITAL GAMING MARKET
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Major Platforms Overview – North America
16
Key highlights – major platforms (North America)
 In North America, even though mobile gaming is becoming increasingly popular, consoles are still the
biggest segment
 During 2018-2023, the console gaming segment is expected to expand at a CAGR of XX%
 Due to higher purchasing power of the people (the average U.S. consumer spends over USD 2,000
annually on entertainment and media), compared to developing regions like MEA or APAC
(consumers in Nigeria and India spend less than USD 50 annually on entertainment and media),
people here have higher interest in investing in console games
 Also, the last generation of consoles was introduced in 2013. In 2018, console games contributed a
major share of around XX% to the gaming industry in the North American region. Thus, when the
next generation of consoles come around in 2018-19, the demand for these games is sure to soar
again
 Unlike APAC and MEA, where mobile games is the dominating segment, it is the second largest
segment in North America, after consoles
 Gamers in North America are willing to spend more money on mobile games, compared to their Asia
Pacific counterparts, as the American “install-to-purchase” (engagement and purchase rate)
engagement on mobiles games is almost XX% higher than in APAC
 North America’s PC gaming revenue is expected to expand at a stable CAGR of XX% through 2018-
2023
 Steam, which is one of the most significant digital PC games portals, sells most of its games in North
America, followed by Europe and Asia. League of Legends, Hearthstone: Heroes of Warcraft,
Minecraft, and Overwatch are PC games that people play the most in the U.S.
XX
XX
XX
PCs
Mobiles
Console
2018
USD XX Bn
XX
XX
XX
PCs
Mobiles
Console
2023
USD XX Bn
Revenue contribution based on platforms (North America)
Source: Netscribes Analysis
GLOBAL DIGITAL GAMING MARKET
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Opportunity Areas – Overview
Gaming has moved forward from the
conventional 2D Arcade and TV
video games, to advanced forms
Gaming companies are foraying into the domains of
eSports, Blockchain gaming, cloud gaming, and VR
and AR in gaming
A growing global audience and a top-tier talent pool is
pushing gaming companies to make investments in
these gaming domains.
17
eSports is drawing large
audiences in recent
times, which in turn has
opened up a plethora of
opportunities for media,
gaming, and
entertainment companies
Blockchain gaming
addresses all the
problems that the gaming
industry has been facing
for years
Cloud gaming enables
gamers to play high-end
games on low-end
machines
Players are more involved
in VR-based gaming, as it
has the potential to
create social experiences
1 2 3 4
GLOBAL DIGITAL GAMING MARKET
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Virtual Reality, Augmented Reality, and Mixed Reality
Overview
 VR had been thought to possess great potential as it could create social experiences while gaming
 Players would be more involved in a VR based gaming. VR gaming makes players feel as if they belong to a
scene rather than demonstrating things. The simulation in VR gaming allows players to see things from different
angles and perspectives
 After cross analyzation of eSports engagement and VR buying intention, it was found that there was a strong
correlation between them - near about 63% of all VR buyers were into eSports
 Mark Liu, the chief executive of the world’s largest chipmaker, Taiwan Semiconductor Manufacturing, has said
that there is great demand from game console processors and gaming graphics processing units for VR
applications. He also said that in the coming years, VR will be embedded in people’s daily lives, thus changing
the way people communicate and interact, and would increase productivity as well
 The concept of mixed reality in gaming is also on the rise. Mixed reality games enable gamers to experience the
real world with virtual objects. The increasing adoption of wearable devices by gamers is creating avenues for
further developments in this domain
 Also, an increase in the demand for connected devices, together with advancements in processing technology
and sensors, are driving the AR, VR, and mixed reality market
 Niantic came up with the world’s first edge-enhanced mixed reality multiplayer experience with its Codename:
Neon. It boasts of a fully multi-tenant control plane that supports zero-touch provisioning of edge cloud
resources as close to the players as possible
18
Major Challenge – Pace of Adoption
 VR seems to be stuck in its early-adopter phase, with only the deeply-pocketed and most committed users
getting involved. The main factor blocking the mainstream adoption of VR games seems to be the dearth of
compelling content
 The only good triple-A titles compatible with PSVR are Resident Evil and Gran Turismo Sport
 The key takeaways from the annual survey conducted by the Game Developers Conference stated that there is
a declining interest in VR. It is a bit of a whiplash to the VR industry as a whole
 The vastly exciting technology, which was thought it would break through and dominate everything back in
2015 and 2016, could not garner much attention. In 2017, it witnessed a slow rate of adoption among
consumers, which amounted to a big reality check for VR gaming
 Industry experts state that it is the interest in VR that is dwindling. The number of developers working on AR
games is in a steady state, and those who are already there in the business of creating VR games do not expect
it to be a long-lasting market
– The CEO of the studio CCP Games, Hilmar Veigar Petursson, said that their company does not see much of a
future for VR gaming. They expected VR to be two to three times as big as it was. Hilmar said that their data
showed that VR-based gaming adoption was slow even among enthusiasts. With hardware that is difficult to
set up, absurd PC requirements, and nearly no AAA titles to attract the curious into the world of VR, it is
increasingly unlikely that the gaming industry will see a significant shift to VR any time soon
GLOBAL DIGITAL GAMING MARKET
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Virtual Reality, Augmented Reality, and Mixed Reality – Regional Insights
19
North America Europe
Asia-Pacific (APAC)
LATAM
 Research conducted by a global leader in games and
esports analytics at the end of the year 2016 on the
European and North American countries, stated that 11%
of the online population across the countries in Europe
(aged 10-65) intended to buy a Virtual Reality (VR) product
in the next six months
 The research claimed that the buying intention would be
highest in Spain and Italy with consumers in Belgium and
the Netherlands staying most skeptical about the new
technology
 It was also observed that 7% of this group, or about
4 million people, were non-gamers. This was proof that VR
technology’s reach was already extending beyond gaming
 In the U.S., the intent to buy is a bit higher than that
of the European aggregate, with 12% of the online
population planning to buy a VR product in the
coming six months
 According to the report by a global leader in games and eSports analytics, spending on augmented reality (AR) and VR will be humongous for the Asia-Pacific region
 The availability of new VR headsets such as Mirage Solo from Lenovo and Oculus Go from Facebook are expected to drive the adoption, as well as content spending in 2018, and beyond
 These headsets eliminate the need for pairing with consoles or PCs, which used to drive the costs higher for VR/AR experiences
 The launch of the AR SDK platforms from both Apple and Google are also expected to drive spending on application developments and games for mobile platforms
 In 2018, VR games had the highest market share out of all the applications of VR
 Latin America’s new video game federation has
developers from eleven countries working together to
give a boost to the gaming market in the region
 The Argentinian studio, OKAM, formed in 2010, came up
with its first virtual reality title Ship Ahoy!, a multiplayer
nautical battler for HTC Vive and Oculus Rift, on January
10, 2018
 The stakes for VR gaming is high in this region with
developers finally planning on making their moves.
GLOBAL DIGITAL GAMING MARKET
|
Company Overview: Tencent
 Year of establishment: 1998
 Headquarters: Shenzhen, China
 Key people: Ma Huateng (Chairman)
 Employee strength (2017): 44,796
 Industry: Video games
 Ticker: HKG: 0700
 Website: www.tencent.com
Major game titles
 PUBG
 Arena of Valor
 Honour of Kings
 Ring of Elysium
 Wangzhe Rongyao
20
Growth strategy
 Tencent Games plans to capture at least a third of India’s gaming user
base in two years by making a humongous investment of USD 200 Mn
 The company presented its new platform, Games Without Borders
(GWB), built by the Tencent Institute of Games, to gather innovative
ideas from game developers around the world. Through this platform,
Tencent aims to foster, promote, and protect outstanding games
 Tencent introduced 26 new games in 2018. The company is focusing on
its gaming business to drive growth
Major locations
 Asia, primarily Hong Kong and China
 North America
 Europe
Key numbers (2017)
 Net revenue (FY ending Dec. 2017): USD 35.6 Bn
 Net revenue (until June 2018): USD 11.1 Bn
 Net margin (%): 33
 Gross margin (%): 49.2
 RoA (%): 15.1
 RoE (%): 33.2
Major initiatives
 In 2018, Tencent invested USD 474 Mn in Shanda Games. This move will
bolster Tencent’s lead in the local video gaming market
 In 2018, the company folded yet another video gaming company into
its empire. Square Enix signed a letter of intent to enter into a strategic
alliance with Tencent
 Tencent, which partners with Epic Games to sell in China, announced a
new set of rules for streaming games in the country in February 2019
 In May 2018, Tencent signed an MoU with Britain to work closely with
its cultural industries, thereby deepening the co-operation between
China and Britain and setting the stage for Tencent’s further
international expansion
Recent initiatives
 In November 2018, Tencent Games announced a collaboration with a
Blockchain eSports platform named SLIVER.tv to create a live eSports
channel that would feature streamers from Method, FaZe Clan, and
NRG. The channel would be powered by Theta rewards, and the users
would be able to buy in-game upgrades and items using the Theta
tokens
GLOBAL DIGITAL GAMING MARKET
| 21
Major Companies Foraying into the Gaming Market
 Google plans to unveil a new gaming hardware at the Game
Developers Conference in 2019. The service will enable gamers to
stream console-quality games on a cheaper device
 The company is likely to offer a “Netflix for games” subscription
service. The three-month demo of Project Stream, which came to an
end in January 2019, enabled users to play Assassin’s Creed
Odyssey on their Google Chrome browsers on Mac, Windows, Linux,
and Chrome
 However, it is believed that Project Stream was just part of Google’s
broader gaming efforts, Project Yeti
 The plan for Project Yeti is to run high-performance titles, on its own
machines, and then stream them to the devices owned by the
gamers
 It has been said that Google had been beta testing the full Project
Yeti streaming service internally. Reports say that the service will also
include an in-game chat function
 The Project Yeti console, which is likely to be a streaming-only device,
is presumed to be cheaper than dedicated gaming consoles, such as
Xbox One and PlayStation
 Facebook had released its first batch of Instant Games back in 2016 in
a closed beta version. These games could be easily played without
the need for any additional downloads from the app store
 Recently, the company revealed that the daily monthly active players
had increased by more than three times in 2018, and that there were
over 6,000 games with over 20 Bn game sessions being played
 Facebook reported that it had experienced rapid growth since March
2018, after the company opened up the platform to all the
developers
 The company is aggressively expanding its gaming system in multiple
directions. Recently, it added “Play” buttons, which directly link to
Instant Games, to more than 270,000 gaming groups that serve over
90 Mn active users
 Amazon, which operates the largest video game streaming service in
the world with its Twitch, is getting serious about video games
 The company wants to take the video game publishing industry to
the cloud completely
 News reports say that Amazon is working on building a Netflix-like
service for gaming. The new service from Amazon is likely to allow
players to stream games without having to download the individual
titles
GLOBAL DIGITAL GAMING MARKET
|
Start-up Overview – Disruptor
Overview
 Description – Flying Mollusk is a small
independent studio which aims to create
entertaining and impactful games by making
use of emerging technologies
 Founded in - 2013
 Headquarters – Los Angeles, California
 Website - www.flyingmollusk.com
 Industry - PC gaming
Key Initiatives
 Flying Mollusk’s psychological thriller, Nevermind, makes
use of Affectiva’s emotion recognition software to sense
a gamer’s facial expressions to detect signs of emotional
distress. Nevermind’s use of biofeedback makes the
game more challenging and surreal
Overview
 Description – Lucid Sight primarily focuses on frontier
gaming and its supporting technologies. Their games
are secured by the Ethereum Blockchain
 Founded in - 2015
 Number of employees – 23
 Headquarters – Los Angeles, California
 Website - www.lucidsight.com
 Industry – PC and console gaming
Funding Information
 Number of funding rounds: 3
 Total funded amount (USD Mn): 10.5
 Number of investors: 6
 Nature of funding: VC and HNI
 Investor description: BreakawayGrowth Fund,
Salem Partners, Rana Capital Partners
Key Initiatives
 The VR gaming start-up released a VR advertising
SDK to help other gaming companies effectively
monetize their VR games. It was founded to help
gaming companies focus on developing engaging,
free, high-quality VR games
Key People
Erin Reynolds
Founder
Michael Annetta
Lead VR Designer
Key People
Randy Saaf
CEO
Octavio Herrera
COO
22GLOBAL DIGITAL GAMING MARKET
|
Appendix
23
Reporting
The analyst then creates a report
with the support of his findings and
analysis, with help from an editorial
team.
Problem identification
The analyst identifies key questions
that he/she would like to address
from the market study.
He/she describes the major
challenges that would help clients
understanding the industry,
globally, or for a specific region.
Defining objectives
The analyst then defines the
research objectives and
methodologies which form the
basis of the research.
Information gathering
The next stage of research is
conducted utilizing secondary and
primary sources of information.
They conduct an in-depth study of
the global market, identifying and
understanding its key stakeholders,
drivers, trends, challenges, and
opportunities, covering major
regions such as North America,
Latin America, Europe, Asia-Pacific,
and the Middle East and Africa.
Primary research complements the
secondary research, as and when
required, as it helps gain insights
from the industries directly, by
communicating with senior
executives, key opinion leaders, and
independent consultants who are
experts in their industries, or
specific industry sectors.
Analysis
The qualitative and quantitative
findings from the previous stages
are brought together by specialists
to perform a rigorous analysis. The
regional market trends, drivers, and
opportunities obtained during the
analysis are compared with regional
economic indicators, sector growth
rates, population index, etc., to
ensure consistency of the data.
After consistency is ensured, these
historical and present indicators
help to understand how the market
will perform in the future. The
proprietary forecasting model
factors in all these indicators to
predict the future market
accurately.
GLOBAL DIGITAL GAMING MARKET
Research Methodology
|
Appendix
24
About Research on Global Markets
Owned by Netscribes, Research on Global Markets is the go-to platform for global professionals looking for credible and transparent
research on developed and emerging markets. We set ourselves apart from other online market research publishers with our
focused coverage, commitment to data authenticity, simple licensing, and complete user privacy.
Research on Global Markets (ROGM) is a comprehensive source for syndicated market research reports on various emerging, high-
growth sectors across the globe. The reports provide detailed analysis, with reliable market data and information, including global
macroeconomic trends, market size, growth forecasts, competitive landscape, and market share analysis across more than 200
countries.
Research on Global Markets draws from the company’s vast experience in market research and intelligence. It provides tactical and
actionable insights to clients, and enables effective decision-making and strategic implementation.
GLOBAL DIGITAL GAMING MARKET
|
Disclaimer
25GLOBAL DIGITAL GAMING MARKET
This report is prepared by Research On Global Markets ("ROGM"), a brand owned by Netscribes (India) Private Limited (“Netscribes”).
The content of this report is developed in accordance with ROGM’s professional standards. Accordingly, the information provided herein has been obtained from sources which
are reasonably believed to be reliable. All information provided in this report is on an “as-is" and an "as-available” basis, and no representations are made about the
completeness, veracity, reliability, accuracy, or suitability of its content for any purpose whatsoever. All statements of opinion and all projections, forecasts, or statements
relating to expectations regarding future events represent ROGM’s own assessment and interpretation of information available to it. All liabilities, however arising, in each of
the foregoing respects are expressly disclaimed.
This report is intended for general information purposes only. This report does not constitute an offer to sell or issue securities, an invitation to purchase or subscribe for
securities, or a recommendation to purchase, hold, sell, or abstain from purchasing, any securities. This report is not intended to be used as a basis for making an investment in
securities. This report does not form a fiduciary relationship or constitute investment advice. Nothing in this report constitutes legal advice.
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Global Digital Gaming Market (2018-2023)

  • 1. Proprietary and Confidential, Copyright © 2019, Netscribes, Inc. All Rights Reserved The content of this document is confidential and meant for the review of the recipient. Disclaimer: The names or logos of other companies and products mentioned herein are the trademarks of their respective owners Global Digital Gaming Market 2018 - 2023 MARCH 2019
  • 2. | Table of Contents 2 Chapter 2 Introduction  2.1. Market Definitions  2.2. Different business models  2.3. Distribution channel analysis: Big four companies Chapter 3 Global Digital Gaming Market Overview  3.1. Market overview – Global market revenue (USD Bn) – Global projected market revenue (USD Bn) – Geography-wise market revenue (USD Bn)  3.2.Global trends Chapter 1 Executive Summary  1.1. Market scope and segmentation  1.2. Key questions answered in this study  1.3. Executive summary GLOBAL DIGITAL GAMING MARKET
  • 3. | Table of Contents Chapter 4 Global Digital Gaming Market – Based on Region  4.1. North America – Overview – Drivers – Challenges – Trends  4.2. Asia-Pacific – Overview – Drivers – Challenges – Trends 3 Chapter 4 (Cont.) Global Digital Gaming Market – Based on Region  4.3. Latin America – Overview – Drivers – Challenges – Trends  4.4. Europe Middle East and Africa (EMEA) – Overview – Drivers – Challenges – Trends Chapter 5 Global Digital Gaming Market – Based on Platform  5.1. Global digital gaming market overview – Based on platform  5.2. Global mobile games market – Drivers – Challenges  5.3. Global console games market – Drivers – Challenges  5.4. Global PC games market – Drivers – Challenges GLOBAL DIGITAL GAMING MARKET
  • 4. | Table of Contents Chapter 6 Major Platforms Overview – By Region  6.1. Major platforms – North America – Revenue contribution – Key highlights  6.2. Major platforms – Asia-Pacific – Revenue contribution – Key highlights  6.3. Major platforms – Latin America – Revenue contribution – Key highlights  6.4. Major platforms – EMEA – Revenue contribution – Key highlights 4 Chapter 7 Huge Opportunity Zones  7.1. eSports  7.2.Blockchain gaming  7.3.Cloud gaming  7.4.Virtual reality, augmented reality, and mixed reality Chapter 8 Competitive Landscape  9.1. Activision Blizzard – Company snapshot – Key numbers – Major game titles – Initiatives – Growth strategy  9.2. Electronic Arts – Company snapshot – Key numbers – Major game titles – Initiatives – Growth strategy GLOBAL DIGITAL GAMING MARKET
  • 5. | Table of Contents Chapter 8 Competitive Landscape  9.3. Take-Two Interactive – Company snapshot – Key numbers – Major game titles – Initiatives – Growth strategy  9.4. Ubisoft – Company snapshot – Key numbers – Major game titles – Initiatives – Growth strategy 5 Competitive Landscape  9.5. Zynga – Company snapshot – Key numbers – Major game titles – Initiatives – Growth strategy  9.6. Tencent – Company snapshot – Key numbers – Major game titles – Initiatives – Growth strategy Competitive Landscape  9.7. GungHo Online – Company snapshot – Key numbers – Major game titles – Initiatives – Growth strategy  9.8. Nintendo – Company snapshot – Key numbers – Major game titles – Initiatives – Growth strategy GLOBAL DIGITAL GAMING MARKET
  • 6. | Table of Contents Competitive Landscape  9.9. Sony Corporation – Company snapshot – Key numbers – Major game titles – Initiatives – Growth strategy  9.10. Microsoft Corporation – Company snapshot – Key numbers – Major game titles – Initiatives – Growth strategy 6 Major Players Foraying into the Gaming Market  Google  Facebook  Amazon Chapter 9 Gaming Start-ups and Disruptors  10.1. Chopup  10.2. Omnidrone  10.3. Piranha Games  10.4. Nazara Technologies  10.5. Witching Hour Studios  10.6. Touchten Games  10.7. Steel Wool Studios  10.8. Playsnak  10.9. Flying Mollusk  10.10. Lucid Sight  10.11. Ironhide Game Studio  10.12. NGD Studios GLOBAL DIGITAL GAMING MARKET
  • 7. | Table of Contents Gaming Start-ups and Disruptors  10.1. Chopup  10.2. Omnidrone  10.3. Piranha Games  10.4. Nazara Technologies  10.5. Witching Hour Studios  10.6. Touchten Games  10.7. Steel Wool Studios  10.8. Playsnak  10.9. Flying Mollusk  10.10. Lucid Sight  10.11. Ironhide Game Studio  10.12. NGD Studios  10.13. Google and Facebook 7 Chapter 10 Conclusion  10.1.Conclusion Chapter 11 Appendix  11.1. List of tables  11.2. Research methodology  11.3. Assumptions  11.4. About Research On Global Markets GLOBAL DIGITAL GAMING MARKET
  • 8. | Executive Summary I 8 Overview  The global digital gaming market is one of the most thriving sectors in the global media and entertainment industry.  The market is forecast to experience significant expansion, at a CAGR of XX%, and will reach USD XX Bn by 2023  The mobile gaming segment is the largest, having generated USD XX Bn in 2017, followed by console and PC games  The overall market trend shows a shift from brick and mortar stores towards more digital purchases Drivers  Technological advancements and shift of network from 2G to 4G will lead to an increase in digitally-downloadable games, and other live games of the MMO and eSports genres  The increasing prominence of cross-platform games and 3D games is boosting the global digital gaming market  The number of smartphone users are expanding at a significant rate, which in turn is boosting the mobile gaming market globally – The proliferation of smartphones and tablet PCs is giving a considerable thrust to the global gaming market Trends  Game development companies are increasingly considering digital distribution as the preferred distribution channel as compared to physical distribution channels – Digital distribution allows gamers to purchase and download digital content for different gaming platforms  Increasing adoption of eSports, especially in the Asia-Pacific region, has bolstered growth of the gaming industry – Currently, eSports is one of the areas in which gaming companies are willing to make significant investments, since the eSports market’s revenue increased by more than four times between 2013 and 2016, and could almost triple by 2021 Challenges  The investment crunch is one of the factors posing a challenge to the mobile gaming industry – In the absence of funds, mobile gaming-based start-ups have limited access to infrastructure and talent  The biggest problem that the gaming industry faces is the need for creation of new content to keep existing audiences engaged  Securing users constantly is essential for gaming companies to ensure that their earnings do not dip – Gaming experts say that the industry has reached a position where almost all possible genres and methods of gameplay have been explored GLOBAL DIGITAL GAMING MARKET XX XX XX XX XX XX XX XX 264.9 0.0 50.0 100.0 150.0 200.0 250.0 300.0 2015 2016 2017 2018 2019 2020 2021 2022 2023 Global Digital Gaming Market Revenue (USD Bn) Source: Netscribes Analysis GLOBAL DIGITAL GAMING MARKET
  • 9. | Executive Summary II Segmentation Based on Region  The digital gaming market is segmented based on region: North America, Asia-Pacific, Latin America, Europe, the Middle East and Africa  APAC is forecast to contribute XX% of the total revenue of the digital gaming market in 2023  APAC is expected to witness the highest growth rate through the forecast period of 2018-2023  Most of APAC’s growth is to come from China, a region where mobile gaming is becoming increasingly popular  Mobile gaming is the dominant form of gaming in the Latin American region  The mature market of North America is expected to see console games as the largest segment 9 Segmentation Based on Platform  The digital gaming market is further segmented based on platforms: PCs, mobiles, and consoles  The mobile gaming segment was the largest, with a market share of XX% in 2017, and will be expanding at the highest CAGR of 23.1% (2018- 2023) among the three – The market is driven by revenue from advertisements, affordability of mobile phones in emerging markets, proliferation of the Internet, and low entry barrier costs in gaming  The console gaming segment is expected to be the second-largest one in the gaming market – It will be driven by the launch of next-generation consoles and expanded digital purchases  Research On Global Markets’ analysis predicts a considerable shift from PC gaming, to mobile and console gaming – The market share of PC gaming has witnessed a fall over the years as the market is restrained by factors like piracy, high cost of gaming PCs, etc. Competitive Landscape  In the competitive landscape, ten major gaming companies have been profiled: – Activision Blizzard – Electronic Arts – Take Two Interactive – Ubisoft – Zynga – Tencent – Nintendo – GungHo Online – Sony Corporation – Microsoft Corporation  The prominent trends among the top companies are adoption of eSports, Virtual Reality (VR), and digital distribution of games  The growth strategies of the companies include organic expansion to develop older games and improve their relationship with customers – Also, inorganic expansion by way of acquisitions help companies venture into segments like mobile games, and technologies like AR, VR, etc.  A snapshot of eight new-age gaming start-ups - Chopup, Omnidrone, Piranha Games, Nazara Technologies, Witching Hour Studios, Touchten Games, Steel Wool Studios and Playsnak, Flying Mollusk, Lucid Sight, Ironhide Game Studio, and NGD Studios - is given, along with their funding information, initiatives, and recently-released games GLOBAL DIGITAL GAMING MARKET
  • 10. | Global – Market Trends Digital Distribution  Delivering games digitally, instead of distributing the same via retail/physical channels, is the most prominent trend now  In digital distribution, the barriers to entry are significantly low – Big gaming companies have created their own platforms for digital distribution, likes Steam, Origin, and Xbox Live Marketplace, using which, gamers purchase and download digital content for different gaming platforms 10 Change in Gaming Devices  Another key trend in the industry is the evolution of gaming devices  Mobile games are quickly gaining popularity, since more gamers are turning to their smartphones and tablets for entertainment, thereby facilitating digital distribution  Entry barriers in the mobile gaming industry are lower than other platforms  As a result, major companies are investing in mobile games. In 2016, Activision Blizzard completed the acquisition of King Digital Entertainment to expand on its opportunities in mobile gaming Use of Communication Software and Virtual Credits  Games are now being equipped with messaging and video applications to allow smooth communication ‘in between’ games, across players  Developers are currently focusing on monetizing content, by enabling virtual credit systems for the sale of downloadable digital content within games, or 'in-game purchases' like buying new avatars, and purchase of extra levels, among others GLOBAL DIGITAL GAMING MARKET
  • 11. | Global – Market Trends Adoption of eSports  eSports is a form of competitive video gaming where players compete with each other in an online or live environment for a large number of viewers  The most common genres of video game associated with eSports are real-time strategy, combat, first-person shooter (FPS), and multiplayer online battle arena (MOBA)  Currently, eSports is one of the major areas that gaming companies are willing to invest in, since revenue from this market grew by more than four times between 2013 and 2016, and might almost triple by 2021 11 Adoption of AR and VR Technologies  AR and VR are new but essential trends in the gaming industry, and it is actively being made available to customers at affordable prices  VR is more about having a great gaming ‘experience’ rather than just playing a game  This leaves room for speculation with regard to how successfully VR will be able to convert hours of dedicated game-playing into a more immersive gaming experiences  On the other hand, AR technology is easily implementable, and its success is visible from the popularity of Pokémon Go and Night Terrors Women and Non-Millennial Gamers  There has been an enormous rise in the number of female gamers. Since 2010, female gamers have made up around half of all global gamers  In the U.S. - a leading gaming region - the average age of gamers is 37  Also, 31% of the video game-playing population comprises adult women, while only 18% of the gaming population are boys of ages below 18 GLOBAL DIGITAL GAMING MARKET
  • 12. | 2017 2016 2015 2017 2016 2015 2017 2016 2015 2017 2016 2015 ActivisionBlizzardElectronicArts TakeTwo InteractiveUbisoft Distribution Channel Analysis 12 With the dawn of the broadband Internet era, the landscape of game distribution channels has changed over the years  Major gaming companies like EA, Take-Two, Activision Blizzard and Ubisoft are increasingly shifting towards the digital distribution channels, from the retail distribution channels Clearly, digital distribution is a common growth strategy for top players  It allows companies to make their products available to consumers at minimal costs, thereby, drastically lowering the total cost of developing video games Video game producers are focusing more on story and content development, without worrying about incurring massive costs on distribution channel intermediaries Gaming companies are also launching titles which were previously available only on PCs and gaming consoles  Games such as FIFA, Madden NFL, The Sims, SimCity, and Star Wars are available across mobile platforms and even as free, downloadable versions for PCs In addition to developers and publishers, digital distribution benefits consumers by enabling them to buy/play the games online without having to purchase it through any retailer (online/B&M)  They can download games directly through websites like Steam, Origin, and others Revenue from the retail distribution of games for the four major companies has declined, and digital distribution channels have gained prominence. In 2015, revenue from both channels of distribution were almost equal, while in 2017, it became clear that the future of the market was in games downloaded over the Internet, and not so much in games bought via retailers Distribution Channel Analysis : Four Major Companies Retail Digital Source: Annual reports of the stated companies GLOBAL DIGITAL GAMING MARKET
  • 13. | XX XX XX XX XX XX XX XX XX Mobile Console PC 13 Mobile  Mobile games was the largest segment of the 2018 global digital gaming market, accounting for XX% of the revenue  This segment is expected to expand at a CAGR of XX% during the 2018-2023 period, and is the fastest-growing segment, globally  By 2023, the mobile gaming segment is forecasted to hold on to largest market share Console  Console games came after the mobile gaming segment, with a revenue share of XX% in 2018, generating USD XX Bn  By 2023, revenue from the console gaming market is forecast to reach USD XX Bn 2015 Market share of various platforms (2015, 2018, and 2023) PC  The PC games segment is next, but is expected to experience a negative growth rate during the forecast period (CAGR of XX%)  Research On Global Markets’ analysis says that PC gaming is likely to become the least preferable form of gaming in the years to come. The market revenue from PC gaming is forecast to come down to USD XX Bn 2018 2023 GLOBAL DIGITAL GAMING MARKET Global Digital Gaming Overview – By Platforms Source: Netscribes Analysis
  • 14. | Global Console Games Market Overview The first generation of console games were introduced in the 1970s and had several hardware shortcomings like lack of an audio port, etc. Consoles have come a long way since then and have become much more than a simple gaming device. High-end devices like Xbox, PlayStations, and Wii Switch have 3D graphics, Internet connectivity, online playing options, and movie-watching features. Despite high purchase costs, and increasing competition from the mobiles segment, launch of next-generation consoles and expanded digital purchases on the same will drive the market forward. 14 XX XX XX 2015 2018 2023 Console games - global revenue (USD Bn) Source: Netscribes Analysis GLOBAL DIGITAL GAMING MARKET
  • 15. | Global Console Games Market Overview Drivers Launch of new generation console  The global console market is influenced significantly by the launch of next-generation gaming consoles  The major vendors in this segment are Sony, Microsoft, and Nintendo. The last generation of consoles were released in 2013, and since then, the global console games market has seen a decline, since the market has reached its saturation point  Gamers want upgrades in console technologies, and they look for enhanced audio-visual experiences while gaming through consoles  Thus, the launch of next generation consoles will propel the market Increase in micro transactions/digital purchases on consoles  Mirroring the global gaming market trends, increased digital purchases on consoles will drive the growth of console games Advanced technology and features  Use of advanced technology in consoles acts as a significant driver for console games  New consoles come with better RAM, processing units, motion sensors, and Internet connectivity  Live video streaming via Netflix, YouTube, etc., watching DVDs/ Blu-rays, online game playing, browsing the Internet, among others, make these the preferred consoles, as opposed to traditional ones 15 Challenges Competition from mobile and social gaming  People are shifting to mobile gaming for its ease of access and affordable pricing. Since 2007, mobile apps have become more popular  Meanwhile, serious gamers are shifting to PC-based games. All these put together, have resulted in the contraction of the market size for console games High cost  High initial investment on consoles (which has no alternative use apart from gaming/ browsing) creates a problem with regard to penetration in developing economies like that of APAC, where disposable income is less in comparison to developed regions like North America and Europe  Since gaming/ browsing can be done using PCs/mobile devices, consumers do not usually invest in a dedicated gaming device like a console Inability to adopt eSports  eSports is an emerging trend in the gaming industry. Compared to PC gaming, consoles have limited penetration in the eSports market  Console games have a small share in popular eSports genres like fighting and sports, and in that little share, the emphasis is more on one-on-one gaming instead of MMO. This acts as a significant deterrent for the growth of eSports on consoles GLOBAL DIGITAL GAMING MARKET
  • 16. | Major Platforms Overview – North America 16 Key highlights – major platforms (North America)  In North America, even though mobile gaming is becoming increasingly popular, consoles are still the biggest segment  During 2018-2023, the console gaming segment is expected to expand at a CAGR of XX%  Due to higher purchasing power of the people (the average U.S. consumer spends over USD 2,000 annually on entertainment and media), compared to developing regions like MEA or APAC (consumers in Nigeria and India spend less than USD 50 annually on entertainment and media), people here have higher interest in investing in console games  Also, the last generation of consoles was introduced in 2013. In 2018, console games contributed a major share of around XX% to the gaming industry in the North American region. Thus, when the next generation of consoles come around in 2018-19, the demand for these games is sure to soar again  Unlike APAC and MEA, where mobile games is the dominating segment, it is the second largest segment in North America, after consoles  Gamers in North America are willing to spend more money on mobile games, compared to their Asia Pacific counterparts, as the American “install-to-purchase” (engagement and purchase rate) engagement on mobiles games is almost XX% higher than in APAC  North America’s PC gaming revenue is expected to expand at a stable CAGR of XX% through 2018- 2023  Steam, which is one of the most significant digital PC games portals, sells most of its games in North America, followed by Europe and Asia. League of Legends, Hearthstone: Heroes of Warcraft, Minecraft, and Overwatch are PC games that people play the most in the U.S. XX XX XX PCs Mobiles Console 2018 USD XX Bn XX XX XX PCs Mobiles Console 2023 USD XX Bn Revenue contribution based on platforms (North America) Source: Netscribes Analysis GLOBAL DIGITAL GAMING MARKET
  • 17. | Opportunity Areas – Overview Gaming has moved forward from the conventional 2D Arcade and TV video games, to advanced forms Gaming companies are foraying into the domains of eSports, Blockchain gaming, cloud gaming, and VR and AR in gaming A growing global audience and a top-tier talent pool is pushing gaming companies to make investments in these gaming domains. 17 eSports is drawing large audiences in recent times, which in turn has opened up a plethora of opportunities for media, gaming, and entertainment companies Blockchain gaming addresses all the problems that the gaming industry has been facing for years Cloud gaming enables gamers to play high-end games on low-end machines Players are more involved in VR-based gaming, as it has the potential to create social experiences 1 2 3 4 GLOBAL DIGITAL GAMING MARKET
  • 18. | Virtual Reality, Augmented Reality, and Mixed Reality Overview  VR had been thought to possess great potential as it could create social experiences while gaming  Players would be more involved in a VR based gaming. VR gaming makes players feel as if they belong to a scene rather than demonstrating things. The simulation in VR gaming allows players to see things from different angles and perspectives  After cross analyzation of eSports engagement and VR buying intention, it was found that there was a strong correlation between them - near about 63% of all VR buyers were into eSports  Mark Liu, the chief executive of the world’s largest chipmaker, Taiwan Semiconductor Manufacturing, has said that there is great demand from game console processors and gaming graphics processing units for VR applications. He also said that in the coming years, VR will be embedded in people’s daily lives, thus changing the way people communicate and interact, and would increase productivity as well  The concept of mixed reality in gaming is also on the rise. Mixed reality games enable gamers to experience the real world with virtual objects. The increasing adoption of wearable devices by gamers is creating avenues for further developments in this domain  Also, an increase in the demand for connected devices, together with advancements in processing technology and sensors, are driving the AR, VR, and mixed reality market  Niantic came up with the world’s first edge-enhanced mixed reality multiplayer experience with its Codename: Neon. It boasts of a fully multi-tenant control plane that supports zero-touch provisioning of edge cloud resources as close to the players as possible 18 Major Challenge – Pace of Adoption  VR seems to be stuck in its early-adopter phase, with only the deeply-pocketed and most committed users getting involved. The main factor blocking the mainstream adoption of VR games seems to be the dearth of compelling content  The only good triple-A titles compatible with PSVR are Resident Evil and Gran Turismo Sport  The key takeaways from the annual survey conducted by the Game Developers Conference stated that there is a declining interest in VR. It is a bit of a whiplash to the VR industry as a whole  The vastly exciting technology, which was thought it would break through and dominate everything back in 2015 and 2016, could not garner much attention. In 2017, it witnessed a slow rate of adoption among consumers, which amounted to a big reality check for VR gaming  Industry experts state that it is the interest in VR that is dwindling. The number of developers working on AR games is in a steady state, and those who are already there in the business of creating VR games do not expect it to be a long-lasting market – The CEO of the studio CCP Games, Hilmar Veigar Petursson, said that their company does not see much of a future for VR gaming. They expected VR to be two to three times as big as it was. Hilmar said that their data showed that VR-based gaming adoption was slow even among enthusiasts. With hardware that is difficult to set up, absurd PC requirements, and nearly no AAA titles to attract the curious into the world of VR, it is increasingly unlikely that the gaming industry will see a significant shift to VR any time soon GLOBAL DIGITAL GAMING MARKET
  • 19. | Virtual Reality, Augmented Reality, and Mixed Reality – Regional Insights 19 North America Europe Asia-Pacific (APAC) LATAM  Research conducted by a global leader in games and esports analytics at the end of the year 2016 on the European and North American countries, stated that 11% of the online population across the countries in Europe (aged 10-65) intended to buy a Virtual Reality (VR) product in the next six months  The research claimed that the buying intention would be highest in Spain and Italy with consumers in Belgium and the Netherlands staying most skeptical about the new technology  It was also observed that 7% of this group, or about 4 million people, were non-gamers. This was proof that VR technology’s reach was already extending beyond gaming  In the U.S., the intent to buy is a bit higher than that of the European aggregate, with 12% of the online population planning to buy a VR product in the coming six months  According to the report by a global leader in games and eSports analytics, spending on augmented reality (AR) and VR will be humongous for the Asia-Pacific region  The availability of new VR headsets such as Mirage Solo from Lenovo and Oculus Go from Facebook are expected to drive the adoption, as well as content spending in 2018, and beyond  These headsets eliminate the need for pairing with consoles or PCs, which used to drive the costs higher for VR/AR experiences  The launch of the AR SDK platforms from both Apple and Google are also expected to drive spending on application developments and games for mobile platforms  In 2018, VR games had the highest market share out of all the applications of VR  Latin America’s new video game federation has developers from eleven countries working together to give a boost to the gaming market in the region  The Argentinian studio, OKAM, formed in 2010, came up with its first virtual reality title Ship Ahoy!, a multiplayer nautical battler for HTC Vive and Oculus Rift, on January 10, 2018  The stakes for VR gaming is high in this region with developers finally planning on making their moves. GLOBAL DIGITAL GAMING MARKET
  • 20. | Company Overview: Tencent  Year of establishment: 1998  Headquarters: Shenzhen, China  Key people: Ma Huateng (Chairman)  Employee strength (2017): 44,796  Industry: Video games  Ticker: HKG: 0700  Website: www.tencent.com Major game titles  PUBG  Arena of Valor  Honour of Kings  Ring of Elysium  Wangzhe Rongyao 20 Growth strategy  Tencent Games plans to capture at least a third of India’s gaming user base in two years by making a humongous investment of USD 200 Mn  The company presented its new platform, Games Without Borders (GWB), built by the Tencent Institute of Games, to gather innovative ideas from game developers around the world. Through this platform, Tencent aims to foster, promote, and protect outstanding games  Tencent introduced 26 new games in 2018. The company is focusing on its gaming business to drive growth Major locations  Asia, primarily Hong Kong and China  North America  Europe Key numbers (2017)  Net revenue (FY ending Dec. 2017): USD 35.6 Bn  Net revenue (until June 2018): USD 11.1 Bn  Net margin (%): 33  Gross margin (%): 49.2  RoA (%): 15.1  RoE (%): 33.2 Major initiatives  In 2018, Tencent invested USD 474 Mn in Shanda Games. This move will bolster Tencent’s lead in the local video gaming market  In 2018, the company folded yet another video gaming company into its empire. Square Enix signed a letter of intent to enter into a strategic alliance with Tencent  Tencent, which partners with Epic Games to sell in China, announced a new set of rules for streaming games in the country in February 2019  In May 2018, Tencent signed an MoU with Britain to work closely with its cultural industries, thereby deepening the co-operation between China and Britain and setting the stage for Tencent’s further international expansion Recent initiatives  In November 2018, Tencent Games announced a collaboration with a Blockchain eSports platform named SLIVER.tv to create a live eSports channel that would feature streamers from Method, FaZe Clan, and NRG. The channel would be powered by Theta rewards, and the users would be able to buy in-game upgrades and items using the Theta tokens GLOBAL DIGITAL GAMING MARKET
  • 21. | 21 Major Companies Foraying into the Gaming Market  Google plans to unveil a new gaming hardware at the Game Developers Conference in 2019. The service will enable gamers to stream console-quality games on a cheaper device  The company is likely to offer a “Netflix for games” subscription service. The three-month demo of Project Stream, which came to an end in January 2019, enabled users to play Assassin’s Creed Odyssey on their Google Chrome browsers on Mac, Windows, Linux, and Chrome  However, it is believed that Project Stream was just part of Google’s broader gaming efforts, Project Yeti  The plan for Project Yeti is to run high-performance titles, on its own machines, and then stream them to the devices owned by the gamers  It has been said that Google had been beta testing the full Project Yeti streaming service internally. Reports say that the service will also include an in-game chat function  The Project Yeti console, which is likely to be a streaming-only device, is presumed to be cheaper than dedicated gaming consoles, such as Xbox One and PlayStation  Facebook had released its first batch of Instant Games back in 2016 in a closed beta version. These games could be easily played without the need for any additional downloads from the app store  Recently, the company revealed that the daily monthly active players had increased by more than three times in 2018, and that there were over 6,000 games with over 20 Bn game sessions being played  Facebook reported that it had experienced rapid growth since March 2018, after the company opened up the platform to all the developers  The company is aggressively expanding its gaming system in multiple directions. Recently, it added “Play” buttons, which directly link to Instant Games, to more than 270,000 gaming groups that serve over 90 Mn active users  Amazon, which operates the largest video game streaming service in the world with its Twitch, is getting serious about video games  The company wants to take the video game publishing industry to the cloud completely  News reports say that Amazon is working on building a Netflix-like service for gaming. The new service from Amazon is likely to allow players to stream games without having to download the individual titles GLOBAL DIGITAL GAMING MARKET
  • 22. | Start-up Overview – Disruptor Overview  Description – Flying Mollusk is a small independent studio which aims to create entertaining and impactful games by making use of emerging technologies  Founded in - 2013  Headquarters – Los Angeles, California  Website - www.flyingmollusk.com  Industry - PC gaming Key Initiatives  Flying Mollusk’s psychological thriller, Nevermind, makes use of Affectiva’s emotion recognition software to sense a gamer’s facial expressions to detect signs of emotional distress. Nevermind’s use of biofeedback makes the game more challenging and surreal Overview  Description – Lucid Sight primarily focuses on frontier gaming and its supporting technologies. Their games are secured by the Ethereum Blockchain  Founded in - 2015  Number of employees – 23  Headquarters – Los Angeles, California  Website - www.lucidsight.com  Industry – PC and console gaming Funding Information  Number of funding rounds: 3  Total funded amount (USD Mn): 10.5  Number of investors: 6  Nature of funding: VC and HNI  Investor description: BreakawayGrowth Fund, Salem Partners, Rana Capital Partners Key Initiatives  The VR gaming start-up released a VR advertising SDK to help other gaming companies effectively monetize their VR games. It was founded to help gaming companies focus on developing engaging, free, high-quality VR games Key People Erin Reynolds Founder Michael Annetta Lead VR Designer Key People Randy Saaf CEO Octavio Herrera COO 22GLOBAL DIGITAL GAMING MARKET
  • 23. | Appendix 23 Reporting The analyst then creates a report with the support of his findings and analysis, with help from an editorial team. Problem identification The analyst identifies key questions that he/she would like to address from the market study. He/she describes the major challenges that would help clients understanding the industry, globally, or for a specific region. Defining objectives The analyst then defines the research objectives and methodologies which form the basis of the research. Information gathering The next stage of research is conducted utilizing secondary and primary sources of information. They conduct an in-depth study of the global market, identifying and understanding its key stakeholders, drivers, trends, challenges, and opportunities, covering major regions such as North America, Latin America, Europe, Asia-Pacific, and the Middle East and Africa. Primary research complements the secondary research, as and when required, as it helps gain insights from the industries directly, by communicating with senior executives, key opinion leaders, and independent consultants who are experts in their industries, or specific industry sectors. Analysis The qualitative and quantitative findings from the previous stages are brought together by specialists to perform a rigorous analysis. The regional market trends, drivers, and opportunities obtained during the analysis are compared with regional economic indicators, sector growth rates, population index, etc., to ensure consistency of the data. After consistency is ensured, these historical and present indicators help to understand how the market will perform in the future. The proprietary forecasting model factors in all these indicators to predict the future market accurately. GLOBAL DIGITAL GAMING MARKET Research Methodology
  • 24. | Appendix 24 About Research on Global Markets Owned by Netscribes, Research on Global Markets is the go-to platform for global professionals looking for credible and transparent research on developed and emerging markets. We set ourselves apart from other online market research publishers with our focused coverage, commitment to data authenticity, simple licensing, and complete user privacy. Research on Global Markets (ROGM) is a comprehensive source for syndicated market research reports on various emerging, high- growth sectors across the globe. The reports provide detailed analysis, with reliable market data and information, including global macroeconomic trends, market size, growth forecasts, competitive landscape, and market share analysis across more than 200 countries. Research on Global Markets draws from the company’s vast experience in market research and intelligence. It provides tactical and actionable insights to clients, and enables effective decision-making and strategic implementation. GLOBAL DIGITAL GAMING MARKET
  • 25. | Disclaimer 25GLOBAL DIGITAL GAMING MARKET This report is prepared by Research On Global Markets ("ROGM"), a brand owned by Netscribes (India) Private Limited (“Netscribes”). The content of this report is developed in accordance with ROGM’s professional standards. Accordingly, the information provided herein has been obtained from sources which are reasonably believed to be reliable. All information provided in this report is on an “as-is" and an "as-available” basis, and no representations are made about the completeness, veracity, reliability, accuracy, or suitability of its content for any purpose whatsoever. All statements of opinion and all projections, forecasts, or statements relating to expectations regarding future events represent ROGM’s own assessment and interpretation of information available to it. All liabilities, however arising, in each of the foregoing respects are expressly disclaimed. This report is intended for general information purposes only. This report does not constitute an offer to sell or issue securities, an invitation to purchase or subscribe for securities, or a recommendation to purchase, hold, sell, or abstain from purchasing, any securities. This report is not intended to be used as a basis for making an investment in securities. This report does not form a fiduciary relationship or constitute investment advice. Nothing in this report constitutes legal advice. The information and opinions contained in this report are provided as of the date of the report and are subject to change. Reports may or may not be revised in the future. Any liability to revise any out-of-date report, or to inform recipients about an updated version of such report, is expressly disclaimed. A bonafide recipient is hereby granted a worldwide, royalty-free, enterprise-wide limited license to use the content of this report, subject to the condition that any citation from this report is properly referenced and credited to Research On Global Markets. Nothing herein conveys to the recipients, by implication or by way of estoppel, any intellectual property rights in the report (other than the foregoing limited license) or impairs Netscribes’ intellectual property rights, including but not limited to any rights available to Netscribes under any law or contract. To the maximum extent permitted by law, all liabilities in respect of this report and any related material is expressly disclaimed. Netscribes does not assume any liability or duty of care for any consequences of any person acting, or refraining to act, by placing reliance on the basis of information contained in this report. All disputes and claims arising in relation to this report will be submitted to arbitration, which shall be held in Mumbai, India under the Indian Arbitration and Conciliation Act. The exclusive jurisdiction of the courts in Mumbai, India, applies to all disputes concerning this report and the interpretation of these terms, and the same shall be governed by and construed in accordance with Indian law without reference to the principles of conflict of laws.
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Editor's Notes

  1. https://www.albertinisyz.it/en/insight/fast-growing-digital-gaming-market-not-such-gamble https://seekingalpha.com/article/77347-video-game-industry-one-of-the-most-attractive-areas-to-invest http://www.theoryofgaming.com/video-game-industry-crossroads/
  2. https://www.albertinisyz.it/en/insight/fast-growing-digital-gaming-market-not-such-gamble https://seekingalpha.com/article/77347-video-game-industry-one-of-the-most-attractive-areas-to-invest http://www.theoryofgaming.com/video-game-industry-crossroads/
  3. https://qz.com/780475/us-census-bureau-real-median-household-income-saw-the-largest-recorded-increase-in-history-in-2015-rising-5-2-almost-3000/ (1st driver) https://stats.oecd.org/Index.aspx?DataSetCode=AV_AN_WAGE (1st driver) https://www.census.gov/library/publications/2018/demo/p60-263.html (1st driver) http://www.lsainsider.com/study-us-adult-daily-time-spent-with-digital-media-grows-2-5-hours-in-5-years/archives#sthash.OQaF4ODf.dpbs (2nd driver) https://www.weforum.org/agenda/2018/10/chart-of-the-day-us-spending-on-video-games-is-now-bigger-than-the-gdp-of-bahrain/ https://www.nielsen.com/us/en/insights/news/2018/time-flies-us-adults-now-spend-nearly-half-a-day-interacting-with-media.html https://www.speedtest.net/insights/blog/2018-internet-speeds-global/ https://marketingland.com/mobile-now-accounts-nearly-70-digital-media-time-comscore-210094 (2nd driver) https://www.google.co.in/url?sa=t&rct=j&q=&esrc=s&source=web&cd=1&cad=rja&uact=8&ved=0ahUKEwjonciR9b7XAhUOTo8KHUMRBJQQFggqMAA&url=https%3A%2F%2F www.reuters.com%2Farticle%2Fus-usa-economy-idUSKBN1810BZ&usg=AOvVaw0ZYNy07sFB6CbkIoFmPYWv (3rd driver) http://theesa.ca/2017/11/01/strong-video-game-new-report/ ( 3rd TREND) Essential facts report 2015 and 2017 calculated for 1st trend Wikipedia search esports started in California. And internet speed in USA (https://www.fastmetrics.com/internet-connection-speed-by-country.php) https://www.forbes.com/sites/kevinmurnane/2017/08/14/speedtest-ranks-internet-access-speed-in-more-than-100-countries/#2f505a4f65b5 important https://en.wikipedia.org/wiki/List_of_countries_by_smartphone_penetration (challenge 1) https://www.creditloan.com/blog/the-state-of-the-40-hour-workweek/ (challenge 2) https://www.smartinsights.com/social-media-marketing/social-media-strategy/new-global-social-media-research/ (challenge 3) important site for data on usa
  4. https://qz.com/780475/us-census-bureau-real-median-household-income-saw-the-largest-recorded-increase-in-history-in-2015-rising-5-2-almost-3000/ (1st driver) https://stats.oecd.org/Index.aspx?DataSetCode=AV_AN_WAGE (1st driver) https://www.census.gov/library/publications/2018/demo/p60-263.html (1st driver) http://www.lsainsider.com/study-us-adult-daily-time-spent-with-digital-media-grows-2-5-hours-in-5-years/archives#sthash.OQaF4ODf.dpbs (2nd driver) https://www.weforum.org/agenda/2018/10/chart-of-the-day-us-spending-on-video-games-is-now-bigger-than-the-gdp-of-bahrain/ https://www.nielsen.com/us/en/insights/news/2018/time-flies-us-adults-now-spend-nearly-half-a-day-interacting-with-media.html https://www.speedtest.net/insights/blog/2018-internet-speeds-global/ https://marketingland.com/mobile-now-accounts-nearly-70-digital-media-time-comscore-210094 (2nd driver) https://www.google.co.in/url?sa=t&rct=j&q=&esrc=s&source=web&cd=1&cad=rja&uact=8&ved=0ahUKEwjonciR9b7XAhUOTo8KHUMRBJQQFggqMAA&url=https%3A%2F%2F www.reuters.com%2Farticle%2Fus-usa-economy-idUSKBN1810BZ&usg=AOvVaw0ZYNy07sFB6CbkIoFmPYWv (3rd driver) http://theesa.ca/2017/11/01/strong-video-game-new-report/ ( 3rd TREND) Essential facts report 2015 and 2017 calculated for 1st trend Wikipedia search esports started in California. And internet speed in USA (https://www.fastmetrics.com/internet-connection-speed-by-country.php) https://www.forbes.com/sites/kevinmurnane/2017/08/14/speedtest-ranks-internet-access-speed-in-more-than-100-countries/#2f505a4f65b5 important https://en.wikipedia.org/wiki/List_of_countries_by_smartphone_penetration (challenge 1) https://www.creditloan.com/blog/the-state-of-the-40-hour-workweek/ (challenge 2) https://www.smartinsights.com/social-media-marketing/social-media-strategy/new-global-social-media-research/ (challenge 3) important site for data on usa
  5. https://www.nytimes.com/2015/12/21/technology/as-downloads-take-over-a-turning-point-for-the-video-game-industry.html Annual Reports of EA, T2, etc. http://www.theisthmus.com.au/2011/10/digital-distribution-changing-the-world-of-games/ https://www.theguardian.com/technology/2016/may/17/video-game-industry-changing-virtual-studios
  6. https://www.biu-online.de/en/blog/2016/08/11/pc-and-console-games-purchasing-digital-games-via-download-becomes-popular-alternative/ http://www.eurogamer.net/articles/2017-05-10-ea-reckons-40-percent-of-console-game-sales-will-be-downloads-by-the-end-of-2017(2nd driver) http://fortune.com/2016/12/23/sony-microsoft-nintendo-future/ http://www.nielsen.com/us/en/insights/news/2013/play-vs--stream--the-modern-gaming-console.html http://www.military-technologies.net/2017/11/03/global-gaming-console-market-by-2021-leading-countries-growth-drivers-risks-opportunities-forecast-top-vendors-analysis/
  7. https://techcrunch.com/2014/03/09/console-crisis/ (1st Challenge) http://www.esportsbettingelite.com/learn-esports/what-types-of-games-does-esports-include/( esports genres 3rd challenge) https://www.biu-online.de/en/blog/2016/08/11/pc-and-console-games-purchasing-digital-games-via-download-becomes-popular-alternative/ http://www.eurogamer.net/articles/2017-05-10-ea-reckons-40-percent-of-console-game-sales-will-be-downloads-by-the-end-of-2017(2nd driver) http://fortune.com/2016/12/23/sony-microsoft-nintendo-future/ http://www.nielsen.com/us/en/insights/news/2013/play-vs--stream--the-modern-gaming-console.html http://www.military-technologies.net/2017/11/03/global-gaming-console-market-by-2021-leading-countries-growth-drivers-risks-opportunities-forecast-top-vendors-analysis/
  8. https://newzoo.com/insights/rankings/top-20-core-pc-games/ https://www.tweaktown.com/news/58254/steam-sells-games-north-america/index.html  https://venturebeat.com/2017/07/20/newzoo-high-fidelity-games-are-taking-over-the-mobile-market/ https://www.webwire.com/ViewPressRel.asp?aId=207221
  9. https://newzoo.com/insights/articles/vr-buying-intention-europe-north-america/ https://www.goodworklabs.com/how-virtual-reality-can-impact-the-gaming-industry/ https://mashable.com/2018/01/24/virtual-reality-gaming-loser-gdc-2018-survey/#YkOh0TFGz5qw https://www.idc.com/getdoc.jsp?containerId=prAP43848718 https://www.ft.com/content/6a3daba4-4a6c-11e6-8d68-72e9211e86ab https://tech.co/news/why-is-vr-failing-to-take-off-again-2018-08 https://theoutline.com/post/6443/virtual-reality-dream-is-dead-hype-oculus-rift-facebook-playstation?zd=2&zi=izvp2kkb https://venturebeat.com/2018/07/06/latin-americas-new-video-game-federation-has-devs-from-11-countries-working-together/
  10. https://newzoo.com/insights/articles/vr-buying-intention-europe-north-america/ https://www.goodworklabs.com/how-virtual-reality-can-impact-the-gaming-industry/ https://mashable.com/2018/01/24/virtual-reality-gaming-loser-gdc-2018-survey/#YkOh0TFGz5qw https://www.idc.com/getdoc.jsp?containerId=prAP43848718 https://www.ft.com/content/6a3daba4-4a6c-11e6-8d68-72e9211e86ab https://tech.co/news/why-is-vr-failing-to-take-off-again-2018-08 https://theoutline.com/post/6443/virtual-reality-dream-is-dead-hype-oculus-rift-facebook-playstation?zd=2&zi=izvp2kkb https://venturebeat.com/2018/07/06/latin-americas-new-video-game-federation-has-devs-from-11-countries-working-together/
  11. https://asia.nikkei.com/Business/Business-trends/Tencent-opts-for-strategy-that-fits-with-Made-in-China-2025 https://finance.yahoo.com/news/tencent-games-forms-partnership-blockchain-183211729.html http://www.xinhuanet.com/english/2018-05/10/c_137167524.htm Annual report
  12. https://www.digitaltrends.com/gaming/google-may-unveil-project-yeti-console-at-gdc-2019/ https://www.fool.com/investing/2019/01/19/facebooks-mobile-gaming-ecosystem-is-rapidly-expan.aspx https://www.businessinsider.in/Amazon-is-reportedly-building-a-Netflix-like-service-for-video-games/articleshow/67479518.cms
  13. https://www.flyingmollusk.com/projects https://www.kickstarter.com/projects/reynoldsphobia/nevermind-biofeedback-horror-game https://techcrunch.com/2016/05/16/vr-gaming-startup-lucid-sight-nabs-3-5m-in-series-a-funding/ https://craft.co/lucid-sight