Video Game Insights: Indie Games on Steam in 2024
Indie gaming is on the rise. But what is indie, and what's not in the current market?
Market Overview
99.9% of all games released on Steam are indie games.
As of the end of September 2024, indie games account for 58% of all copies sold on Steam, which is a record high since 2018.
In terms of revenue, indie games also make up 48% of all money generated on Steam. The previous record was in 2022 (32% of all revenue). This means indie games earn as much on Steam as AA/AAA releases.
The most successful indie releases this year include Black Myth: Wukong (20.6 million copies sold), Palworld (20.1 million copies), Manor Lords (3.3 million copies), Enshrouded (3 million copies), and Content Warning (3 million copies).
❗️VGI notes that the concept of "indie games" is becoming increasingly blurred in today’s market. The quality of these games can match that of AAA releases (Black Myth: Wukong), and what appear to be indie projects may actually be backed by large companies (Dave the Diver). For VGI's criteria on indie games, see here.
Indie Market Growth
The average annual growth rate of the indie market by the number of games was 11% up to 2024. In 2024, the number of games is expected to be 18% higher than the previous year.
The average annual growth rate in terms of copies sold was 5% until 2024, and in 2024, this figure is expected to increase to 33% year-over-year (YoY).
Revenue grew at an average rate of 16% annually from 2018 to 2023. In 2024, revenue growth is expected to reach 82% YoY.
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The majority of revenue in 2024 came from two projects: Black Myth: Wukong ($1 billion) and Palworld ($500 million). All other indie games released in 2024 earned less than Black Myth: Wukong alone ($800 million). Indie games released before 2024 accounted for 43% of all revenue.
❗️If we exclude Black Myth: Wukong, the market growth in 2024 would be 11%—lower than the average annual rate from 2018 to 2023.
Indie Market Segments
VGI identifies four main groups of indie developers: Triple-I (50+ people; 1M+ copies sold; $50M+ revenue), Middle Market (15-50 people; 200,000 - 1M copies sold; $10M revenue), Small Teams (3-15 people; 20,000 - 200,000 copies sold; $1M revenue), and Hobby Developers (1-2 people; 2,000 - 20,000 copies sold; $50k revenue).
The most significant growth in the number of released games since the start of the pandemic has been among Triple-I developers. There has also been an increase in projects from mid-sized developers.
In terms of revenue, Triple-I developers are capturing an increasingly significant market share. As of 2024, games from these developers account for 53% of all revenue.
State of Indie Teams
Indie developers are actively gaining experience. The number of teams releasing their second and third games is growing (+12% and +15% CAGR, respectively).
According to statistics, each new game tends to be more successful than the previous one. The second game, on average, sells 40% better, and the third game sells 24% better than the second. The hits of 2023-2024 (Palworld, Baldur’s Gate III, Lethal Company, V Rising) were not the first games from these studios.