Weekly Gaming Reports Recap: August 28 - September 1 (2023)
Kadokawa ASCII and Niko Partners shed light on the Japanese market; Circana highlighted bright news on the US market (it's back to growth); data.ai & IDC predicted gaming industry 2023 numbers.
Reports of this week (okay, which I highlighted this week):
Sensor Tower: Top 10 Mobile Games by Revenue and Downloads in July 2023
Twitch: Viewers watched Baldur's Gate III for over 41M hours
GameRefinery: Key mobile game updates in the US, China, and Japan in July 2023
Niko Partners: Youth gamers in Japan
Sensor Tower: Whiteout Survival is the revenue leader in South Korea in category
Circana: The US gaming market returns to growth
GameDiscoverCo & Gamalytic: Insights from Steam reviews
Tencent: The number of registered users in Arena Breakout has exceeded 80M
data.ai & IDC: Mobile Gaming Market to reach $108B in 2023
Kadokawa ASCII: Japanese gaming market grew against global trends in 2022
Newzoo: Diablo IV is the leader in MAU among RPGs in July 2023
Sensor Tower: Top 10 Mobile Games by Revenue and Downloads in July 2023
Revenue
In July 2023, mobile gamers spent $6.56 billion on entertainment, roughly the same as the previous year.
The United States is the largest mobile market ($1.9 billion - 28.7% of the total volume). China accounts for 19.7%, and Japan for 16.4%. As always, it should be noted that Sensor Tower does not calculate revenue from third-party Android stores in China.
Honor of Kings earned $220 million in July and once again claimed the top spot.
In second place is PUBG Mobile ($172 million). 62.8% of this revenue came from China; the United States accounted for 9%; India ranks third in revenue at 7.5%.
Justice Online, the new MMORPG from NetEase, earned $113 million and climbed to the third position on the chart. It's worth mentioning that the game is currently only available in China.
Downloads
4.74 billion games were downloaded in July 2023.
India accounts for 17.5% of global downloads (833 million); Brazil is second with 9%; the US holds 8.4% of the market share in downloads.
Garena Free Fire led in downloads in July, being downloaded over 21 million times. 27.7% of the downloads came from India, followed by Indonesia (9.4%) and Brazil (8.3%).
Roblox ranked second in downloads (20.4 billion). Brazil accounted for 12.9% of the downloads; the US - 12.2%; Mexico - 7.3%.
Arena Breakout by Tencent took the third spot in the ranking of the fastest-growing games by downloads in July.
Twitch: Viewers watched Baldur's Gate III for over 41M hours
Statistics were collected within 22 days after the game's global launch.
21 million unique users watched streams of the game.
Larian Studios also prepared special extensions for channels, allowing viewers to see the streamer's build, their inventory, and participate in real-time dialogue choices. These extensions were installed by 45 thousand users.
GameRefinery: Key mobile game updates in the US, China, and Japan in July 2023
USA
Diablo Immortal introduced a new character class - Blood Knight. Downloads surged by 400% after the update, but revenue remained unchanged, as the character isn't sold for money.
In Monopoly GO, the first event - Baking Partners - was launched in July, leading to a doubled revenue since its start.
Stumble Guys launched an event based on the "Barbie" movie.
PUBG Mobile initiated a collaboration with Dragon Ball, nearly a year after the announcement.
Japan
The Pokemon Company launched Pokemon Sleep, an app for sleep tracking with collecting elements. The app claimed the top spot for downloads in Japan, and Pokemon Go featured a thematic event.
Dragon Ball Legends introduced a new character (Super Saiyan God SS Vegito), resulting in a 2000% revenue surge on the day of release.
China
Justice Online ranked third in revenue and second in downloads in the country.
Niko Partners: Youth gamers in Japan
The company studied the behavior of Japanese individuals aged 6 to 18 who spend at least one hour per week playing games.
The majority of Japanese youth play on consoles (72.3%). Following that are mobile devices (63.8%) and PCs (14.7%). Parents prefer consoles due to greater content control.
Young gamers play an average of 8 hours per week on mobile devices and around 6.5 hours each on PCs and consoles.
Japanese youth are more receptive to Western games, eSports, streaming, and VTubers. For example, 46% of Japanese youth watch esports competitions, compared to only 12% of all Japanese gamers.
Buy-to-play games remain very popular in Japan, including among young players.
Japanese youth's parents generally have a positive attitude towards games and are even open to playing themselves.
The majority (66.9%) of Japanese parents believe that setting limits on game time is the responsibility of each individual family, rather than the government.
Sensor Tower: Whiteout Survival is the revenue leader in South Korea in category
Since its release on February 9th, the game has earned $130 million.
Worldwide, Whiteout Survival has been downloaded over 12 million times.
In July of this year, the game reached $32 million in monthly revenue and 3.4 million installations. These are records in both categories.
The main revenue markets for the game are the United States (27.2%), South Korea (26.5%), Taiwan (6.8%), Germany (4.6%), and Japan (3.5%).
Regarding downloads, the United States (19.7%) also takes the lead. Following are Turkey (7.2%), South Korea (5.3%), Germany (5.2%), and Indonesia (4.4%).
The highest RPD (Revenue Per Download) is $52 in South Korea.
Whiteout Survival ranks 11th on the list of top-grossing games in South Korea, and it holds the 1st place among strategy games. Its revenue is more than twice that of Top War: Battle Game, which holds the second spot.
58.1% of the traffic for Whiteout Survival in South Korea comes from paid sources, while 41.9% is organic. Sensor Tower notes that this situation is similar worldwide.
Successful marketing efforts and creative strategies have allowed Whiteout Survival to become a leader in South Korea's YouTube SOV (Share of Voice).
Circana: The US gaming market returns to growth
The company expects that the American gaming market will finish the year 2023 with a growth of 3%, reaching $58.3 billion.
In the past 12 months, the revenue of the US gaming industry amounted to $57 billion. This is 1% more than the same period the previous year, and 13% more than the period from July 2019 to July 2020.
Gaming hardware sales for this period reached $7 billion, a 19% increase from the previous year.
The New Year period of 2023 will be relatively problem-free for the first time since 2019. The last quarter of the year is expected to have a large number of releases, and supply chains have normalized.
Consoles
PlayStation 5, since resolving supply issues, is the market leader in the USA. Circana analysts anticipate that the console will maintain its dominant position until at least 2025.
Currently, PS5 is selling 5% better than PS4 and 87% better than PS3 in the USA.
However, the Xbox Series lags behind the Xbox One by 10% but outperforms the Xbox 360 by 6%.
Nintendo Switch has surpassed the sales of Nintendo Wii in the USA. The total sales of the system in the USA now trail only Xbox 360 (by less than 1 million units) and PS2 (by less than 5 million units).
Households with an annual income exceeding $100,000 constitute the main consumers of gaming consoles (40% of all sales). Meanwhile, the share of households with an annual income of less than $50,000 has decreased by 9 percentage points since 2020, down to 31%.
Content
The growth in digital game purchases is the primary driver of revenue growth from content in the USA. Sales of new blockbusters have overshadowed the decline in the mobile market and in-game content volume.
User spending on subscriptions in the USA has plateaued since November 2021. Perhaps that's why Sony decided to omit PS Plus audience information from the latest report.
The share of portable PC gaming is growing thanks to Steam Deck and ASUS ROG Ally.
Accessories
The most common accessories are headphones and gamepads.
In 2023, headphone sales in the USA increased by 2% compared to 2022.
GameDiscoverCo & Gamalytic: Insights from Steam reviews
The number of reviews on Steam games is increasing every year. In 2013, there were 93 copies sold per review, while in 2023, there were 32 copies sold per review.
The more discounts, the fewer reviews. Up to an average discount size of 20%, there is no correlation (on average, 1 review per 34-35 copies). However, once the average discount size increases to 30% and higher, there are between 40 to 57 copies sold per review.
Games with negative (up to 50% positive) reviews receive a lot of reviews - 24-39 sales per review. Games with a very high (close to 100%) number of positive reviews result in 25 copies sold per review similarly. This is apparently because people either want to share their dissatisfaction or tell others about the wonderful game they played.
The more a person plays a game, the higher the probability that they will leave a review.
For niche games (up to 100 reviews) and hits (100,000 reviews and more), there is roughly the same conversion to reviews (1 review per 36-38 copies).
Tencent: The number of registered users in Arena Breakout has exceeded 80M
The looter shooter was released on July 13th. However, both AppMagic and data.ai only "saw" 21-22 million downloads. Apparently, not all registered users proceeded to install the game.
Tencent refers to Arena Breakout as one of the most successful novelties in its history. The game reached the top of download charts in over 100 countries on the day of its release.
According to AppMagic's data, the game has currently generated $50.5 million in revenue. 95% of the total revenue comes from China.
data.ai & IDC: Mobile Gaming Market to reach $108B in 2023
Key Figures
The total gaming market will reach $194 billion by the end of the year.
Mobile gaming will account for 56% of the total gaming revenue for the year, with consoles at 22%, and PCs at 21%. Portable systems like the Nintendo Switch Lite and Steam Deck make up the remaining 1%.
The mobile gaming market is expected to decline by the end of 2023, but analysts from data.ai and IDC believe that a new growth phase will follow in the coming year.
The console gaming market is projected to grow by 3% to $43 billion in 2023, driven by increased sales of the PS5 and Xbox Series.
The PC gaming market is expected to grow by 4% to $40 billion, largely due to subscription revenue growth.
However, the portable console segment is expected to plummet by 20%, primarily due to reduced demand for the Nintendo Switch Lite.
In the APAC region, there is growth in the mobile, console, and PC segments, making it the only market showing growth.
Growing Genres
Racing simulators (+0.3 percentage points), sports simulators (+0.2 percentage points), and arcade racers (+0.3 percentage points) have seen increased downloads in the first half of 2023.
Team Battle RPGs (+0.7 percentage points), thanks to Honkai: Star Rail, as well as Match 3 (+0.9 percentage points) and MOBA (+0.7 percentage points), have seen revenue growth.
Cloud Gaming
In 2023, mobile devices will make up 26% of the cloud gaming market, up from 19% in 2019.
The total revenue of cloud gaming services is projected to reach $3.8 billion in 2023, with a growth rate of over 50% compared to 2022.
The Monthly Active Users (MAU) for cloud gaming services is expected to reach 60 million this year.
Portable Consoles
Nintendo Switch Lite shipments worldwide exceeded 21 million in the first quarter of 2023.
Steam Deck shipments in the same quarter reached 2 million devices.
55% of Nintendo Switch Lite owners are female, while the majority of Steam Deck owners are male (73%). 48% of Nintendo Switch owners are over 35 years old, compared to 83% of Steam Deck owners.
Top Mobile Games of 2023
data.ai highlights Monopoly GO, Honkai: Star Rail, Royal Match, and FIFA Soccer as the top mobile games of 2023.
Mobile Advertising Trends
Match-3 games (66.7%), casino games (66.6%), and board games (61.2%) have the highest percentage of paid installations.
Video advertising is the most popular ad format, with 79% of ad creatives in action games being Playable.
Users in the United States, in general, have become more negative towards advertising, with a decrease in satisfaction with all advertising formats.
Kadokawa ASCII: Japanese gaming market grew against global trends in 2022
The research was shared by Dr. Serkan Toto, the founder of the consulting firm Kantan Games.
In 2022, the Japanese gaming market grew by 1.4%, reaching 2.03 trillion yen. At the current exchange rate, this is approximately $13.9 billion, although the Japanese yen has significantly depreciated in value recently.
According to Kadokawa ASCII, the global market fell by 7% in 2022.
Results by segments in 2022
Sales of gaming hardware increased by 3.4%, reaching $1.4 billion.
Sales of console games grew by 5.9%, reaching $2.7 billion.
PC gaming is rapidly gaining popularity in Japan. In 2022, it grew by 43%, from $0.9 billion to $1.3 billion.
However, the mobile market, which is the largest in the country, declined by 4.4%. In 2022, its revenue amounted to $8.5 billion.
Newzoo: Diablo IV is the leader in MAU among RPGs in July 2023
Diablo IV is also the revenue leader in the USA and the UK on PC and consoles.
The game ranks 9th in MAU among all PC games and 15th in the same metric on consoles.
The USA, Germany, and South Korea are key markets for Diablo IV in terms of MAU.
In July 2023, one in every ten gamers on PC and consoles played Diablo IV. On average, a player spent 42 hours in the game, ranking it 21st in the market.
The game secured the 10th spot in Twitch views, with 28.7 million hours of views.