Rise in digital revenues
In the previous article, we saw the importance and growth of mobile gaming. However, mobile gaming isn’t the only key driver for this significant growth in the global games market. There has been a significant rise in digital revenues for gaming companies Activision Blizzard (ATVI), Electronic Arts (EA), and Take-Two Interactive Software (TTWO). Digital sales account for a majority of gaming publishers’ revenues.
This rise in digital revenues may have encouraged gaming companies to look at a subscription-based business model. According to Newzoo, gaming platform owners Microsoft (MSFT), Sony (SNE), and Nintendo control distribution channels for gaming content and services. These companies are looking to offer subscription services.
Newzoo’s 2018 Global Games Market Report states, “By including latest releases in the Xbox Game Pass and acquiring several development studios for exclusive rights on its latest titles, Microsoft has taken a first step in that direction, which could have an equally fundamental impact on the games industry as it did on the music industry.”
Traditional gaming publishers have started looking at subscription services as a viable business model and are offering access to older gaming titles.