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Games to break $100 billion by 2018

3 min read
26

all the money

We all know gaming is a big industry – it generates a ton of money and has become more lucrative than movies or music. But it’s going to get even bigger with some companies coming out on top.

According to a newly revised forecast from DFC Intelligence, not only will gaming software hit $100 billion, it will do so sooner than expected – in 2018. I want to pause here and point out this is just software. With the new console launches we have talked a lot about hardware sales or the value of gaming in general – this is focused purely on the games, the actual software that we consume.

We are now tracking hardware and software spending separately. Core gamer spending on high-end PCs, dedicated game devices and accessories is starting to soar. When you add in mobile devices the impact of the gaming consumer on total hardware spending is huge.The influence this spending will have will have a bearing on all major players in the consumer electronics space.

The DFC estimates that software revenue in 2014 should be around $64 billion globally, but that core gamer dedication combined with a continually growing mobile market is leading to faster growth:

The new console systems are doing well but much of the predicted growth is on mobile platforms and in BRIC countries. What we are seeing is a game market in 2018 that is likely to be split fairly evenly between console, PC and mobile platforms.

Mobile is expected to make up about 30% of total game software revenue, despite the fact that the mobile games market is very fragmented and overcrowded. DFC analysts warn companies that they should be cautious with their platform strategy to ensure their software is released in the most suitable market. Looking at consoles, the DFC raised its forecast for the PS4 and Wii U but lowered it for the Xbox One:

The Xbox One should carve out a solid share among dedicated action gamers, but due to some questionable business decisions Microsoft’s broader entertainment strategy is in disarray despite the release of the new $399 Kinect-less SKU.

It’s incredible to look at these numbers and it will be interesting to see how the DFC shapes up with their predictions. Just imagine how powerful the gaming market is when you combine the software and hardware sides. The reality is that people are spending exorbitant amounts of money on gaming hardware, as well as all the software to go with it. Part of it is the price of games at launch, but we are also spending more during sales and other promotional events. Then there are still Collector’s Editions. The real challenge will be for the Xbox brand to recover after such a shaky start – despite having a solid product, their PR and marketing really hurt them. I also wonder if the increasing size of the market doesn’t hurt some smaller and independent game developers. Sure, indie game developers can make money if their product is successful, but with such a glut of games on the market, curatorship becomes nearly impossible and numerous games fall through the cracks.

Combining hardware (PCs, consoles, mobiles, tablets or other gaming devices), infrastructure (internet) and software, what percentage of your income would you say you put towards gaming? Has your spending increased at the rate these predictions say, or are more people just joining the gaming herd?

Last Updated: June 25, 2014

26 Comments

  1. oVg FX

    June 25, 2014 at 13:12

    Is that per year?

    Reply

    • Anon A Mouse

      June 25, 2014 at 13:13

      Per CEO marketing meeting.

      Reply

      • oVg FX

        June 25, 2014 at 13:13

        At ROCKSTAR.

        Reply

        • Hammersteyn

          June 25, 2014 at 13:23

          EA hit the trillion mark a while ago.

          Reply

          • oVg FX

            June 25, 2014 at 13:24

            In sequels.

          • Sir Rants A Lot Llew. Jelly!!!

            June 25, 2014 at 13:27

            I think Bethesda hit that number in bugs…..

    • Rince&exhale

      June 25, 2014 at 13:52

      Per DLC.

      Reply

  2. Admiral Chief Cyber Commando

    June 25, 2014 at 13:17

    My spending decreased significantly, but I’m getting more games thanks to Steam

    Reply

  3. Hammersteyn

    June 25, 2014 at 13:23

    100 billion dollars!!!

    Reply

  4. Ryanza

    June 25, 2014 at 13:31

    I ain’t buying games anymore. The way the industry is going the online only, online co-op, multiplayer, route. A lot of the previous games that I bought has just been so disappointing and destroying what gaming used to by. And the time I didn’t have internet, meant that the game I have bought I couldn’t play. Steam offline mode asking me to connect to the internet after about a week. fuck that.

    The way it’s going it looks like I will only be supporting CD Projekt Red and I will be happy.

    The gaming generation who started out with DOS based games has helped build this billion dollar industry where the average gamer buying video games is in his or her 30’s.
    The new internet gaming generation happy to waste money on shit just because it’s connected to the internet. oh the Call of Duty generation. $100 billion good luck. I won’t be part of it.

    Reply

  5. Hammersteyn

    June 25, 2014 at 13:31

    I try to buy one AAA title a month, but there still is a bit of a drought on the PS4 market. Also charging R800 – R900 doe a day one title is a little excessive. Hopefully now that the platinum strike is over the Rand can make a little ground back

    Reply

  6. Alien Emperor Trevor

    June 25, 2014 at 13:37

    My spending rate has gone down quite a lot over the last couple of years. Although that’ll be completely undone when I upgrade at the end of the year & buy an unnamed game’s collectors edition.

    Reply

    • Rince&exhale

      June 25, 2014 at 13:54

      Metro: Last Sight?

      Reply

      • Sith JJ

        June 25, 2014 at 13:55

        Why, because it’s the last we’ll see of him?

        Reply

        • Rince&exhale

          June 25, 2014 at 13:56

          Tehehehe 🙂

          Reply

      • Alien Emperor Trevor

        June 25, 2014 at 14:02

        Yes, Metro: Last Rite – finally you are mine.

        Reply

  7. Sith JJ

    June 25, 2014 at 13:53

    Mine hasn’t really increased much. Though digital copy of games have definitely made them easier to come by.

    Reply

  8. Rince&exhale

    June 25, 2014 at 13:55

    Well I’m sitting on about 6 AAA games right now (including Skyrim) So I think I’m good till Geralt returns!

    Reply

    • Sith JJ

      June 25, 2014 at 13:55

      You’re damaging the cases!!!

      Reply

      • Rince&exhale

        June 25, 2014 at 13:56

        Well, some are virtual, which explains the bruises…

        Reply

      • Alien Emperor Trevor

        June 25, 2014 at 13:56

        Shhhh… I told him they’re like eggs & if he nests on them enough he’ll get more.

        Reply

        • Rince&exhale

          June 25, 2014 at 13:56

          Seems to be working!

          Reply

        • Sith JJ

          June 25, 2014 at 13:57

          LOL

          Reply

  9. Rince&exhale

    June 25, 2014 at 13:59

    So need to decide between Red Dead Redemption or South Park: Stick of Truth for tonight…

    Reply

    • Sith JJ

      June 25, 2014 at 14:01

      South Park looks like a great deal of fun.

      Reply

      • Admiral Chief Cyber Commando

        June 25, 2014 at 14:12

        Toilet humour is always a win

        Reply

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