Weekly Gaming Reports Recap: January 22 - January 26 (2024)
Newzoo highlighted what we can expect in 2024; GDC & Game Developer surveyed game developers in their annual report; Video Games are no longer the largest entertainment segment by revenue in the UK.
Reports of this week:
Newzoo: Forecasts and Gaming Trends for 2024
GDC & Game Developer: The State of the Gaming Industry in 2024
Video Games are no longer the largest entertainment segment in the UK
Newzoo: Forecasts and Gaming Trends for 2024
Trend 1. The gaming market has recovered and will continue its growth.
Newzoo notes that the gaming market reached $184 billion in 2023. By 2026, the company expects a cumulative annual growth rate of 1.3%, reaching $205.4 billion.
Trend 2. Companies will take fewer risks in 2024.
64% of representatives in the gaming industry agree with Newzoo's forecast.
Trend 3. Growth in subscribers to subscription services will slow down.
82% of surveyed gaming industry employees agree with this trend.
This trend began earlier in my view. For example, Sony removed information about the number of PS Plus subscribers from its quarterly reports because the service's audience stopped growing. This happened a little over a year ago.
Trend 4. Gaming companies are returning to the development of Premium (buy-to-play) games.
High competition (19 games accounting for 60% of total user gaming time) is prompting a return from service games to traditional ones. 45% of industry representatives agree with this trend.
Trend 5. Mobile developers are moving towards developing for PC and consoles.
Newzoo analysts believe that issues with user acquisition on mobile devices are driving developers toward new platforms. 36% of surveyed individuals from the gaming industry agree with this.
Trend? Forecast? 6. Nintendo will release its new console alongside 3D Mario.
Trend 7. Xbox will launch its mobile gaming store on Android. 73% of the gaming industry agrees with this.
Trend 8. Nostalgia will become a key factor in the success of service games.
Fortnite OG and World of Warcraft Classic are prime examples. 82% of the industry agrees with this. But what about mobile games?
Trend 9. Generative AI will accelerate game development.
64% of the industry concurs that this will happen.
Trend 10. In 2024, many Souls-like games with open worlds will be released.
Among the already announced are Another Crab’s Treasure; Rise of the Ronin; Black Myth: Waking; Enotria: The Last Song; Flintlock: The Siege of Dawn. And this is not counting the additions to Elden Ring.
Great job, Newzoo. Haven’t seen this trend anywhere - better to have a closer look.
GDC & Game Developer: The State of the Gaming Industry in 2024
Companies surveyed over 3000 employees in the gaming industry.
Platforms and Engines
56% of developers have been working in the gaming industry for less than 10 years. Among those in the industry the longest, the majority are men - 87%.
Currently, 66% of developers are making games for PC, and 57% plan to continue making games for this platform in the future. 33% are working on projects for PlayStation 5, and 30% plan to release games for Xbox Series S|X. Mobile platforms are planned for 23-24%. Only 1% is currently working on games for UGC platforms (Roblox, Fortnite, Minecraft).
The popularity of mobile device development has decreased by 16% compared to 2023. PC and consoles are the most popular platforms.
33% of surveyed developers use Unity; 33% use Unreal Engine; 14% have their engine. In the last 12 months, 7% of companies changed their game engine, 28% plan to do so, and 16% have not yet decided. High numbers are related to Unity's Runtime Fee announcement.
Interest in VR/AR continues to slightly decline. Meta Quest (34%), Steam VR (26%), PlayStation VR2 (15%), Apple visionOS are the most popular platforms for future releases.
Generative AI
31% of developers use generative AI; 18% do not use it but see colleagues using it; 15% are interested but have not applied it yet. Only 23% are not interested.
AI is mostly applied in business and finance (44%), marketing and PR (41%), production and team management (33%). The least is in QA (6%) and audio (14%).
Generative AI is prohibited in 12% of companies, mandatory in 2%, and the rest are undecided.
Attitudes toward AI vary. 21% believe tools based on AI positively impact the industry, 18% negatively, and 57% think the effect is mixed.
84% are concerned to some extent about the ethics of using AI in the gaming industry. The biggest concern is that AI tools will lead to more layoffs.
Blockchain; Monetization Methods
Interest in blockchain games continues to decline. 77% of developers are not interested, a 27% increase compared to 2023. Only 2% of companies use blockchain technologies.
Most developers create premium games (51%), followed by the F2P model (32%).
38% of developers (mostly major ones) have either made or discussed television adaptations of their IP. The majority of the industry (89%) agrees that expanding gaming IP beyond platforms is beneficial.
48% integrate various accessibility tools into their games.
How people are working
The majority of game developers (64%) work 40 hours per week or less.
58% of game companies have decided not to force employees back to the office. Among those who want employees back, AAA companies (40% of them) are the majority.
Layoffs
35% of gaming industry workers have faced layoffs - either themselves, their acquaintances, or colleagues.
56% of those surveyed are concerned about the situation in the industry. Creating unions to protect their rights is seen as one solution.
79% of gaming industry representatives believe that unions are needed in the gaming industry.
5% of respondents are members, and 18% have discussed this issue. There is a direct correlation between the age of respondents and the desire to create unions (more desire among younger respondents).
Demographics
68% of gaming industry workers are aged between 25 and 44.
69% are men, 23% are women, and 5% are non-binary individuals.
Video Games are no longer the largest entertainment segment in the UK
For the first time in the last 11 years, video games have yielded their place as the highest-earning entertainment industry in the UK. Games earned £4.74 billion, showing a growth of 2.9% compared to the previous year.
Surpassing video games is the video content industry, more precisely, subscriptions to services like Netflix, Disney Plus, and Apple TV. This segment earned £4.9 billion in 2023, a 10% increase from 2022. Subscriptions account for 89% of the entire video content market.
The music industry in the UK earned £2.2 billion in 2023, a 9.6% increase from the previous year. The year turned out to be almost record-breaking in terms of performance (close to 2001).
Comparing the figures from 2019 to the results of 2023, the gaming industry grew by 29.2%, video by 88.3%, and music by 38.8%.