What are digital games to us as a society. I believe the most important question to answer when looking at an industry is how the society interact and utilize it. More specifically, how different groups in the society do. Looking at several dozens of iconic speeches, videos and discussion papers, I summarized them into 6 kinds:
Source of Joy: no doubt this is the most usage of a digital game, It is fun to play and makes people happy. Human beings cannot live without play, and games exist to satisfy this need.
Art Form: since the first video game exhibition in Museum of Moving Image in 1989; the characterization of games as art works has been controversial.The opponent states that games has no meaning but to entertain and they do not last long enough like art does; while the supporters argue that the medium of video games is potentially post-modern art and should be viewed through the same critical lens as any other form of art. And looking at how much digital game has changed since 60 years ago, it is likely it becomes an art form in the future.
Education Tools: again a contradicting topic, entertainment software association found 93% of the parents control what games their children play. No doubt that we learnt our first words though playing games; but as we grew up and start to apparel to more sophisticated and violate games, the role of games changed;
Sport & Competition: yet another controversial point of debate; some have argued that "careful planning, precise timing, and skillful execution” ought to be what classifies an activity as sport, and that physical exertion and outdoor playing areas are not required by all traditional or non-traditional 'sports’. And the wide use of performance-enhanced drug (PEDs) further support this analogy.
Beliefs: I thought I was the first to think of game as a religion until I watched Andy Robertson’s talk on "Geek Sermon: Join The Church Of The Gamer”. Andy gave examples on how gaming rituals, artifacts, beliefs, society movements, sense of belonging, duty, hierarchy and families resemble those from different religions. It is hard to draw the line, similar to the argument around “Game as an art form”, only time can tell. There is for sure the concept of God in the game which is the designer of the story and rules.
Ideal World: let me explain, it mean "this is the way my world should be", there is one thing that all games have, and the four fundamental concept of a game:
- Win v.s. Lose: in every competition/battle/task, somebody win and somebody lose;
- Minimum Effort v.s. Reward: users need to do very few things (shoot; switch; throw; turn left & right etc); but as long as you spend money and time, you will be rewarded (status; artifacts; respect)
- Fairness: the rule is same for everybody, no matter where they are from;
- Clear Purpose & Path: you know exact what to do, how far you are from next level;
The four attempts reveal an interesting fact: game is associated with all the things we look forward to in our life. Thus it is just nature to see the digital gaming industry flourish and becomes one driving force of the technology development.
PwC estimated that global video gaming industry will grow from US$71.3 billion in 2015 to US$90.1 billion in 2020, a CAGR of 4.8%; revenue of mobile and mobile web based games is expected to grow from US$12.83 billion in 2015 to US$18.40 billion in 2020, a CAGR of 7.5%.
Global Video Game Industry Growth (2012-2020, Unit: US$ Billion)
North America and Asia Pacific are the two largest markets consuming video games, representing 46.79% and 25.5% of the market share. China and United States are the two single biggest market for games, representing 24.5% and 23.6% of the global market share.
The market revenue is evenly distributed among different devices: computer screens takes up 32.03% of the market while personal screen (mobile) and entertainment screen represents 29.12% and 27.21% of the market share.
Forbes suggested 54.1% of the game units are sold to shooting, action and fighting game; 17.5% related to sports and the rest to role-play (11.6%), adventure (7.7%), strategy (3.8%), family entertainment (3.6%) etc.
Games Market Distribution by Area
Shooting and sports are the top evergreen topics for games. In all of the 3 years, they took over 50% of the seats on the Top 10 list. Minecraft has made the Top 10 list as the dominant role-play game for 2014, 2015 and 2016. Up to today it has sold 50 million copies across PC, Xbox 360, PS3 and other platforms and reached its US$ 100 million milestone. Microsoft showed there are over 40 million unique players each month.
Top 10 Best Selling Games by Category (2014/2015/2016)
The third and fourth quarter of each year appears to be more popular for new game release. And it seems like the late release did not affect the annual sales of the games. For all 2014, 2015 and 2016, 9 out of 10 best selling games were released in Q3 and Q4 of the year.
Number of Games Published by Quarter (2014/2015/2016)
So how the different parties in the gaming industry ecosystem interact and related to each other and how do they make money, I dragged the following landscape diagram to illustrate this question.
Gaming Landscape and Ecosystem
The six most important groups in the gaming landscape are:
Game Developers: companies that develop and publish via publishers or directly to consumers. They design games using in-house or out-source team. Some famous companies include Rockstar North (Developer of Grand Theft Auto Series); Vlve (Developer of Half Life) etc.
Game Publishers: companies that bring the games to market. They are in charge of the packaging and marketing. Some famous companies include EA Games (Publisher of The Sims and FIFA); Activision Blizzard (Publisher of Call of Duty Series) etc. Game Distributors: companies that provide facilities for developers and publishers to sell games to end users. Some famous companies include iTune (Distributor of all iOS games); XBOX store (Distributors of all XBOX games) etc. Regulators & Facilitators: organizations that aim to bring order, transparency and growth to the industry. Some names include World eSports Association, Korea eSport Associations. Independent eSports Organizations (clubs): companies that participate in game competitions. Their revenue comes from sponsorship, ancillary product sales and selling video of their competitions. Some famous companies include Ninjas in Pyjamas (Compete in Counter Strike); Natus Vincere (Compete in Starcraft etc) etc Independent eSports Players: individuals that participant in the games, not associated with any club. Some famous companies include Pieter Bas Kwak; Park Se-jun etc. Leisure Players: general public who play games for fun and social. Leisure players generate most of the revenue for the ecosystem and create the most content for the ecosystem. Game industry resembles the characteristics of film industry from the provider side and sport from the consumer side: Games get developed and then pushed to the market via different channels;
- Successful games are made into series;
- The revenue spike after launch and goes down quickly;
- Players are divided into professional and leisure;
- Professionals engage in various competition and make money on sponsorship;
- Professional players change club from time to time;
- Leisure group also play regularly;
It has an excellent online community. A search of “Call of Duty” revealed 46.9 million results in Youtube. Some views got more than 43 million views and the club’s official channel has millions of subscribers too. It hosts an official forum and has its discussion section on all major game discussion forum. The community is health and active and create positive “Word of Mouth” that generate sales into the bigger consumer group.It is available on all platforms, Windows, OS X, Nintendo DS, GameCube, PayStation 2/3/4/Portalbe/Vita, Wii, Wii U, Nokia N-Gage, X Box, X Box 360, Xbox One, iOS, Android and Blackberry. Anybody that has a smart device can find their version of the “Call of Duty” and play on the device of their choice. The game is easy to pick up, basically you take a gun and shoot. The controls are very smooth and intuitive. et the experience is extremely dynamic, in every mission, you will be playing a different character with a different team; the requirements are different, you may be In the next article, I will look at how the game developers pick up their inspiration and use technologies to manifest these inspirations and bring great games to the consumers.