Newzoo, a game analytics research agency, estimates that the games market will generate $184.4 billion in 2022, marking a 4.3% decline year-on-year.
A new report that briefly summarizes the game market updates throughout 2022 has been published by Newzoo. Compared to 2021, the 2022 gaming market is down, marking the first year-on-year decline since the company first started tracking the global revenue of the gaming industry. Many are wondering if this signals a sharp drop in the gaming industry market.
The 2022 pandemic caused many game companies to experience a drop in revenue due to the normalization of the market. Consistent with previous projections, mobile games generated $92.2 billion, representing 50% of the revenue generated across the entire market. Despite accounting for a larger market share than ever before, total mobile game revenue last year decreased by 6.4% compared to 2021. This marks a larger decline compared to the console segment (4.2%). ) and compared to PC browser games, down 16.7% to $2.3 billion.
2022 is a difficult year for the gaming industry.
There are several factors leading to the decline of mobile games, with Newzoo citing the biggest loss of sales due to the economic downturn. Experts say that the changes to IDFA regulations and the shrinking of the Chinese market are the two most fundamental reasons for the decline in mobile game sales in the past year.
The updated IDFA regulations have fundamentally changed the way mobile games are marketed. This deals a heavy blow to the mobile gaming market, especially the casual genre, and reduces user acquisition rates.
China, while still the largest mobile game market in the world, has been through a tumultuous period. The extended hiatus for new game licensing starting July 2021 means no new games will be released until April 2022. While the new restrictions have resulted in gamers falling behind. Children can only play for three hours a week. China’s mobile gaming market recorded a quarter-on-quarter decline of 19.1% on Oct. 25. Niko Partners forecasts a 5.5% year-on-year decline in 2022, the first decline in two decades.
The Chinese game market is in decline.
Indicating China’s position in the mobile market is a Tencent company. The company recorded its first quarterly loss since listing in 2004 and, although still the most profitable games company in the world, has lost its status as China’s largest company. Out of all the different platforms, only downloaded PC games saw a year-over-year increase in revenue, up 1.8% to $38.2 billion, representing 21% of the market.
“The year 2022 has been a tumultuous year with two consecutive downward revisions to our 2022 forecast. The current forecast is $184.4 billion generated by 3.2 billion global players,” said Tianyi Gu, Newzoo market head. “We see 2022 as a year of adjustment after two years of bull market due to the blockade. Looking back at our pre-pandemic forecast for the games market (from January 2020), revenue for 2020 and 2021 was much higher than anticipated, while 2022 was slightly lower.”
This drop in overall percentages can be attributed to a number of factors, such as the rise of VR gaming competitive platforms which grew at a compound annual growth rate of 44%, reaching 3, $2 billion by 2024, while cloud gaming is predicted to generate $8.2 billion by 2025.
