Game software revenues will reach $116 billion in 2017, according to updated estimates by Newzoo—$7.1 billion higher than estimates made at the beginning of the year. Based on industry performance over the first three quarters of 2017, Newzoo predicts a new gaming boom between now and the year 2020, especially in the mobile sector.
Mobile Leads The Way
Mobile revenue estimates were adjusted the most out of all game industry segments analyzed. Newzoo has changed its initial $46.1 billion estimates to $50.4 billion. Mobile accounts for over a third of global game market revenue at 34 percent this year, and will grow to 41 percent of the market by 2020, the analyst firm states. The mobile sector is currently growing at a rate of 23.3 percent year-over-year.
Growing at a rate of 1.4 percent year-over-year, PC gaming revenue has also been adjusted upward from $29.4 to $32.3 billion. Boxed/downloaded PC titles account for 23 percent of the global games market in 2017, but this will drop to 21 percent by 2020 according to the latest estimates. Browser PC games account for four percent but will drop to three percent by 2020.
Console gaming, meanwhile, will end the year at $33.3 billion—slightly below anticipated revenue levels. The segment is still experiencing year-over-year growth of 3.7 percent, Newzoo notes. The console segment accounts for 29 percent of the total market.
Competitive Play Fuels Growth
Looking at individual game titles on console, PC and mobile, Newzoo found that a growing share of overall game time is occupied by titles with competitive, team play, rankings and livestreaming.
“On mobile, this is particularly true in China and the rest of Asia but also in the West, where competitive mobile titles are increasingly in the top grossing charts,” said Newzoo in its findings. “This has renewed confidence among the biggest Chinese publishers to bring their games to the West.”
The analyst firm notes a growing abundance of new mobile battle royale titles sparked by the success of Playerunknown’s Battlegrounds on PC. This trend, Newzoo says, could add to the rise of competitive gaming on mobile in the West.
Esports could continue its upward trajectory to reach $2.4 billion in 2020 by optimistic estimates.
Onward And Upward
At its current rate, Newzoo expects the current growth of the global games market to continue with a CAGR of 8.2+ percent to reach revenues of $143.5 billion in 2020.
Newzoo tracks and analyzes game revenues generated and reported by over 100 public companies. The analyst firm observed that the highest-grossing companies account for more than 80 percent of global game revenues this year. This figure has grown from 75 percent in 2016.
At the current growth rates of both markets, game revenues will surpass sports revenues in three or four years from now, according to the report. If we add revenues from console gaming hardware (around $10 billion this year) and PC gaming systems and peripherals (around $23 billion in total), gaming is already a bigger global business than sports. This year, gaming will generate more than three times the $38.6 billion in movie ticket sales reported for 2016 by the Motion Picture Association of America.