Weekly Gaming Reports Recap: October 16 - October 20 (2023)
Newzoo released a great report about games' role in different generations' lifestyles; data.ai named the best games in Q3 2023; Sony's gaming business margin is less than 15%.
Reports of this week:
The profitability of Sony's gaming business does not reach 15%
Newzoo: Remnant II metrics in August 2023
Ipsos & Video Games Europe: How children spend money in Games
Minecraft now has more than 300M copies sold
AppMagic: Users have spent over $7B in Scopely games
data.ai: Best mobile games of Q3 2023
Newzoo: How different generations interact with games in 2023
AppMagic: Netflix games have been downloaded over 82M times
WN Media Group: Salary Survey of the Russian-speaking Industry in 2023
The profitability of Sony's gaming business does not reach 15%
Simon Carless from GameDiscoverCo brought up an interesting piece of information from the FTC and Microsoft case hearings, which discusses the profitability of PlayStation.
According to information from the court, PlayStation's profitability is in the range of 11-14% (low teens). In contrast, Activision Blizzard's profitability stands at around 30%.
This is one of the reasons why the outgoing CEO of PlayStation, Jim Ryan, wanted to invest in GAAS (Games as a Service) projects. Firstly, they have higher profitability; secondly, it is important for Sony to reduce its dependence on third-party developers.
❗️ However, Sony is facing difficulties in implementing the transition to GAAS. Jason Schreier from Bloomberg reported that internal studios have little desire to create service-based games. They are accustomed to working on single-player narrative projects.
As of the current moment (October 2023), 92.7% of Daily Active Users (DAU) on PlayStation 4 and PlayStation 5 are accounted for by games from third-party developers.
Newzoo: Remnant II metrics in August 2023
Remnant II sold over a million copies within four days of its release. The success was unexpected for many.
The game ranked fourth in sales in August 2023 in the United States and the United Kingdom among all premium games.
In terms of MAU, Remnant II reached the 28th position for the month. Approximately 2.5% of all players played the game in August. On average, a player spent 30 hours per month playing it. The largest markets in terms of monthly audience are the United States and Germany.
38% of Remnant II's audience also played Diablo IV. There is a 27.3% overlap with Exoprimal and a 24.3% overlap with Final Fantasy XVI.
When looking at paying players, there is a 55.8% overlap with Elden Ring players; a 55.7% overlap with Destiny II players; and a 46.3% overlap with Call of Duty: Modern Warfare II (Warzone 2) players.
Ipsos & Video Games Europe: How children spend money in Games
Ipsos conducted a survey of 2,808 parents (or guardians) on the subject of how children spend money in games. The research is relevant to Europe.
76% of parents claim that their children do not purchase anything in games. 18% say they make purchases, and 7% are unsure.
On average, parents spend €39 per month on in-game purchases for their children in 2023. This is €6 more than in 2020, and Ipsos believes this figure corresponds to inflation.
The majority of children (64%) spend between €1 and €20 per month on in-game purchases.
The most popular purchases (34%) are those that affect the gameplay. Cosmetic purchases come next. It turns out that loot boxes are not as interesting to children.
89% of parents monitor their children's spending on games. Half of them have agreements regarding spending levels. 38% require seeking their permission, and 23% impose spending limits.
Minecraft now has more than 300M copies sold
The last time Microsoft reported game sales was in April 2021 when they amounted to 238 million copies.
Minecraft seems to be the best-selling game in the world. In second place is GTA V, with sales exceeding 185 million copies.
The first version of Minecraft was released on May 17, 2009, and the full release occurred on November 18, 2011.
AppMagic: Users have spent over $7B in Scopely games
On AppMagic's graphs, the company's net revenue is shown - after deducting platform and country taxes - $4.2 billion.
MARVEL Strike Force: Squad RPG accounts for 17% of all spending; Star Trek Fleet Command - 14%; Tip Solitaire TriPeaks - 12%.
The gray area at the end of the graph represents the launch of Monopoly GO!. This highly successful launch currently generates more than 74% of the company's monthly revenue.
52% of the company's total revenue comes from Google Play; and 48% from the App Store.
Regarding user acquisition costs, Scopely spends the majority of its money in the United States (74%). Next are the United Kingdom (5%), Canada (4%), and Germany (4%).
🤝 In July 2023, Scopely was acquired by Savvy Games Group for $4.9 billion.
data.ai: Best mobile games of Q3 2023
Leaders worldwide
Subway Surfers, Garena Free Fire, and ROBLOX are the download leaders in Q3 2023. It's worth noting that Tic Tac Toe: 2 Player XO made its first appearance in the quarterly chart.
Royal Match surpassed Candy Crush Saga in revenue, taking the first position. ROBLOX is in third place. The rapidly growing Monopoly GO is in the fourth spot, and Pokemon GO has also returned to the chart.
Leaders in Monthly Active Users (MAU) for the third quarter include ROBLOX, Garena Free Fire, and Candy Crush Saga.
Worldwide growth leaders
Tic Tac Toe: 2 Player XO, My Perfect Hotel, and Real Car Driving: Race City 3D were the fastest-growing games in terms of downloads in the third quarter.
Revenue growth leaders are Monopoly GO, Royal Match, and Justice Online Mobile, which is currently only available in China. In July, I wrote that it earned$23.3 million within 5 days of its release, and its revenue has stabilized at $1.5 million per day.
The fastest MAU growth in the third quarter was seen in Pokemon Sleep (although it's more of a sleep-tracking app than a game), Battleground Mobile India, and the ubiquitous Monopoly GO.
Tencent's Arena Breakout is gaining ground - it ranks 9th in download growth and 6th in MAU growth.
data.ai charts also provide a breakdown by country.
Newzoo: How different generations interact with games in 2023
Key Findings
Video games are the dominant form of entertainment for Generation Alpha (22%). For Generation Z, games are on par with social media. The older the generation, the less time they spend playing games.
In the modern world, all generations engage with games. Even 43% of baby boomers play games. The highest number of players is in Generation Alpha - 94%.
Younger generations not only play games but also watch them. 70% of Generation Alpha engage in this.
The younger the players, the more important socialization and cooperative play are to them. This explains the popularity of Minecraft, ROBLOX, and Fortnite.
Many young players (more than 54% among men and 39% among women - starting from the millennial generation) consider themselves gamers. The percentage of women with the same opinion is also growing. This suggests that games have evolved from a subculture to mainstream culture - people are not ashamed to admit they play.
Consumption Habits
Smartphones are the primary gaming device across all generations. However, the younger the generation, the more they play on PCs or consoles. Additionally, there is a correlation between age and the number of platforms a person plays on (younger individuals use more platforms).
The youngest generation also plays games of various genres more often. On average, baby boomers play 2.8 genres, while Generation Alpha plays 6.
Games fulfill the different needs of different generations. For Generation Alpha, socialization is one of the key aspects of games. For baby boomers, it's the opportunity to achieve goals and solve puzzles.
Payments
Mobile devices have the best conversion rate to paying users (38% across generations from Alpha to Millennials). Gen Z and Millennials are the most likely to make payments. 61% of Millennials spend money on games.
On PCs and consoles, there are more "whales" (heavy spenders) compared to mobile devices.
Millennials and Generation Z are more likely to buy paid games. It seems that their consumption habits from childhood and adolescence have an influence. Free-to-play (F2P) remains the dominant monetization format.
In-game currency is the leader in sales across all generations. The youngest generation enjoys buying characters, while Millennials and baby boomers prefer content additions.
The motivation to purchase for younger generations is the opportunity to access exclusive content. Millennials and older generations are drawn to discounts.
AppMagic: Netflix games have been downloaded over 82M times
Out of over 80 available games, Too Hot to Handle is the first one with 7.6 million downloads.
The game ranking last in the top 10 for downloads has 1.93 million installations, which is Exploding Kittens.
Ports of Into The Breach and Valiant Hearts have approximately 900,000 installations.
Not all games in the subscription benefit from IP - The Queen’s Gambit Chess, despite the immense success of the series, has only 240,000 installations.
Netflix decided to expand into the mobile gaming space in 2021. Since then, they have made several acquisitions (Next Games, Boss Fight, and other studios). The games are available for free to Netflix subscribers, and the company itself claims that games are a part of its strategy to retain users.
WN Media Group: Salary Survey of the Russian-speaking Industry in 2023
The company collected information through a free questionnaire format. The survey was conducted on 27 thematic TG channels, 20 thematic VK communities, as well as among the audience of WN Media Group media resources. A total of 1004 surveys were analyzed.
46% of the Russian-speaking gaming industry resides outside of Russia. 88% of those, who left, left Russia in 2022. Georgia and Serbia are the primary hubs for relocation (32% of those who left chose these two countries).
The percentage of those who left is higher among experienced professionals. A third of Junior specialists left Russia, but almost half of Senior and Lead employees did so.
The largest group of emigrants includes business developers (90%), community development managers (72%), producers, product managers, and project managers (over 60%).
Salary expectations among Russian-speaking professionals are around $3,000 to $4,000. However, they receive slightly over $2,000 in hand.
46.5% of individuals are dissatisfied with their salaries.
The median salary in the gaming industry in Russia, Belarus, and Kazakhstan is $1,700; in Georgia and Serbia, it is $2,200; in Armenia, it is $2,700; in Cyprus, it is $4,450.
Regarding professions, the highest median salary is for middle managers ($3,200) and top managers ($3,700). The lowest earners are PR specialists ($1,200) and support staff ($1,250).
44.4% of the Russian-speaking gaming industry sees no prospects in their current positions.