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About a year ago around this time, on impulse, people bought a Nintendo Switch — and they’ve never looked back.
Stuck indoors for months at a time in 2021, people took up the controllers with youthful enthusiasm. Games — whether it was on the Switch, PlayStation or PC — allowed people to escape the four walls of their apartment to expansive fantasy worlds, connect with friends and family we couldn’t see in person, and give us something to look forward to at the end of a long WFH day.
Even now, as much of life is vaguely normal in the UK, we still enjoy video games as a way of spending time together that doesn’t involve staring passively at the television. Obviously, we’re not alone. The video-game industry could be one of the greatest beneficiaries of the pandemic, growing 23% in 2020 from the year prior. Though growth probably won’t be as explosive in future years, research firm Newzoo still predicts that revenue will reach $219 billion by 2024.
Two companies hoping to capitalise on this growth are Take-Two Interactive Software Inc and Zynga Inc. Take-Two, owner of the video-game publisher behind the Grand Theft Auto and Red Dead series, announced plans to acquire mobile-games leader Zynga for $11 billion in cash and stock. Investors got spooked at that number, but Tae Kim believes the deal makes good sense.
Consider that the video-game market is split pretty evenly between mobile games and traditional console and PC-based games. Any game maker weighted towards one platform is at a disadvantage. To paraphrase Take-Two’s CEO Strauss Zelnick, this deal would open up an endless list of possibilities for future releases — including using Zynga’s expertise to bring popular franchises such as Grand Theft Auto and BioShock to mobile platforms.
Game playing isn’t the only thing that got a big pandemic bump. Game watching, did too — just look at the sharp rise in streaming service Twitch’s average concurrent viewers in 2020 and 2021.
In 2021, viewers streamed the equivalent of 214,000 years’ worth of Grand Theft Auto V. Go back that far in history, and modern humans potentially hadn’t even made it to Europe yet.
Though one specialises in minute-long dance routines and skits and the other in hours-long gaming marathons, TikTok and Twitch have both played important roles in shaping today’s content creation industry, based on authenticity and personality. But perhaps TikTok wants a slice of Twitch’s pie. You can already go live from mobile on TikTok, but TechCrunch reported in December that the platform is now testing a desktop streaming app.
Deals and new potential platforms aren’t the only things set to make waves in 2022. On New Year’s Day, Square Enix Inc President Yosuke Matsuda set the tone for the year with a poorly received letter in which he outlined his support of blockchain in gaming, earning more ire from players pushing back against company forays into NFTs.
Perhaps the gamers are right to be suspicious. We’ll have to wait and see how these forces shape the gaming industry — people haven’t even touched on the emergence of virtual reality and the metaverse. In the meantime, we’ll be defeating dragons and tending to our farm from the sofa.
—Bloomberg