Pavel Ryakkonen, CEO of WN Media Group, presented an overview of global trends in the gaming industry. In his report, he touched upon the development of cloud technologies, the growing role of China, increased activity in the M&A market, as well as the regulation of gaming companies.Market regulation and censorship
In 2020, the gaming industry faced a number of new challenges, including an increased level of censorship — for example, the campaign of the US authorities against TikTok.
- Government interference in the activities of large companies will only grow.
- “Probably, in the next five years we will see separation, segmentation, strict regulation of major players, similar to what the oil industry experienced at the beginning of the 20th century,” Ryakkonen believes.Apple and its policy changes regarding IDFA are expected to have a big impact on the industry.
- At the same time, the advertising market will also be regulated with the help of other restrictions — for example, the fight against mislids.China’s Growing Influence
China will try to strengthen its position in the global market, gradually capturing a share in different countries (and not just in the USA).
- Chinese developers will still have to put up with strict censorship and regulation by the authorities.
- Since it is necessary to obtain an ISBN for the release of games in China, local companies will even more actively consider the possibilities of publishing their projects abroad.China will also have a big impact on the development of 5G networks.
- The number of users may reach 1.8 billion by 2025, and the developed countries of Asia and the USA will become the leaders.Cloud gaming, VR and consoles
The VR and AR market will grow significantly in the next 3-5 years.
- This will be affected by both the release of more affordable and comfortable helmets, and the release of a sufficient amount of content.Cloud gaming will finally get its due development.
- By 2023, the market capitalization of this industry will reach $4.8 billion, and annual revenue — $ 3.5 billion.According to Ryakkonen, this will entail, among other things, new problems for companies and monopolists, since the authorities will want to regulate an actively developing market.
- Platform holders will also continue to compete with each other, and Microsoft will try to win back part of the console market from Sony.
- Revenue in the cloud gaming segment
Market consolidation
Despite the pandemic, gaming companies have been unusually active in the M&A market.
- This trend will continue at least until 2023.Large companies like Embracer, Tencent and Zynga will continue to acquire new studios and strengthen their positions in the market.
- At the same time, the number of non-specialized investors who are interested in the developing market and are ready to invest money in it will increase.
- Future IPOs of gaming companies will also increase interest in the market from various financial players.
- Mergers and acquisitions in the video game industry
In his report, Ryakkonen also refers to the labor market.
Not all companies were ready to switch to remote work, and therefore efficiency in some cases decreased. This will lead to the introduction of a hybrid model. On the one hand, there will be a real world with its limitations and problems with movement, and on the other — a virtual world in which people interact with each other according to other, more free principles.