A new video game market brief from SuperData shows how historic the past year was for the gaming industry. Encompassing digital games and interactive media, the report highlights development that made 2017 the biggest year ever for the market.
Continued growth in esports
Per the report, interactive entertainment generated $108.4 billion in revenues last year. Of this, roughly $760 million was contributed by esports, a segment that keeps reaching new highs every year.
Sponsorships and ads constituted by far the biggest revenue stream — 70 percent of the total. Prize pools, tournaments, and merchandise and ticket sales together accounted for the remaining 30 percent.
The popularity of competitive gaming can be seen through its gigantic and ever-expanding audience, which reached 258 million fans in 2017. SuperData predicts the market is on an excellent track to become a billion-dollar business in 2018.
The digital games platforms split also delivered interesting insights. For example, mobile games accounted for a massive chunk of the industry’s revenues, finishing at $59.2 billion for the year. This amounts to about 55 percent of the whole market.
PC games came in second with $33 billion, and revenue from console games accounted for $8.3 billion, or eight percent, of total income.
The mobile games segment grew exceptionally year-over-year. Consumer spending largely drove the $14 billion increase over 2016. Here’s some further breakdown from the report:
“Asian publishers dominate the mobile scene with the top 3 titles alone earning over $4.5B in 2017. Regional publishers like Chinese behemoths Tencent and NetEase hold a legal, cultural, and brand-name advantage.
Games like Arena of Valor and Fantasy Westward Journey feature historical and mythological themes and figures from Chinese culture. Meanwhile, Japanese gamers are still flocking toward the mobile platform despite increased competition from console platforms like PlayStation 4 and Nintendo Switch.”
Other interesting findings include that one in three people on the planet (2.5 billion) play free-to-play games across different platforms. These games account for the majority of game market revenues, contributing $82 billion to the total pie.
The incredible story of PlayerUnknown’s Battlegrounds
Released only last year, the success of PlayerUnknown’s Battlegrounds makes headlines over and over. Just eight months after its release, the game generated a whopping $723 million in revenue. By that metric, the title quickly overtook established shooter games Overwatch and CS:GO.
Word about the fun battle royale game quickly spread in the gaming circles. The game has now garnered over 1.5 million players and has been steadily increasing its fan base over the past few months.
Twitch’s revenue slice
Within the gaming video content market, two players stand out. Twitch and YouTube account for roughly 76 percent of the market revenue. That said, Twitch brings in a much bigger share than YouTube.
The Amazon-owned streaming platform takes in 54 percent of the entire GVC revenue, more than doubling YouTube’s share. Most observers know of Twitch’s historically important place in esports and how it’s lapped streaming competitors. But there’s more:
“Despite having half the GVC audience of YouTube, Twitch’s audience is more engaged and willing to spend on their favorite broadcasters,” says SuperData’s report. “Users on Twitch often support their favorite content creators directly through subscriptions and donations, which accounted for 51% of GVC revenue on the platform. In comparison, direct spending accounted for only 20% of YouTube’s GVC earnings, with the rest coming from advertising (69%) and sponsorships (11%).”