The video game industry has been deeply affected by job cuts and layoffs in recent years, but that likely won’t stop it from experiencing strong expansion over the next five years. According to a new report from PwC, its annual profit will exceed $300 billion through 2028, more than double its 2019 profit.
Released this week, “Global Telecoms, Entertainment, and Media Outlook 2024-2028” ranks gaming among the fastest-growing primary sectors in the entertainment and media industry. He says that while the speed of this expansion “will slow down as the segment matures,” gaming will account for 9% of the entire market through 2028.
The report, which considered 53 territories across North America, Europe, the Middle East, Africa, Latin America, and Asia Pacific–around 80% of the world’s population–claimed the superchargers for increased wealth over the next four years are social and casual gaming platforms. These accounted for 68.7% of overall revenue in 2023; they’re predicted to have a 76.4% share by 2028.
PwC says this will reduce traditional gaming’s grip on the industry from 28.6% to 21.4% over the next five years. Even esports and integrated video game advertising–often touted as major moneyspinners in the coming years–will remain “a very small component” of income, not even accounting for 3% of revenue between them by 2028–something the inaugural Esports World Cup, currently underway in Saudi Arabia, undoubtedly aims to transform.
The Asia-Pacific region, the largest generator of overall gaming and esports revenue, will drive change. In 2023, the region generated profits of 109,600 million dollars (48. 1%). By 2028, PwC estimates that figure will be $181. 8 billion (54. 4%). Markets keep emerging; While Japan and China remain havens for gamers, the company touts Indonesia and Pakistan as key countries for growth.
Industry profits are historically characterized by game purchases and subscriptions, but PwC says in-game advertising will become more important. Profits from social and casual in-app gaming are expected to grow from $82. 9 billion to $147. 9 billion through 2028, while advertising profits from in-app gaming will grow more slowly, from $72. 4 billion. to 106. 6 billion dollars.
PwC cites the rumored 2025 release of the Nintendo Switch’s successor as a key driver, alongside “investments in new products, new technologies and new business models.” Younger demographics will continue to drive targets, with the company noting how Disney and Epic Games are now working together to combine Fortnite with the Star Wars, Marvel, and Pixar franchises.
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