Game Industry Will Decline In 2022

Game Industry Will Decline In 2022
The gaming industry has been absolutely booming since early 2020. Which makes sense. Everyone was stuck in their houses for months, nothing was open, some people were unemployed with nothing to do while others still had to work and needed something to balance out the workload with some COVID-safe leisure. We all turned to our trusty consoles, handhelds, and PCs, and studios, publishers, and console-makers reaped the rewards. However, it looks like the coming months will see the end of the industry's recent growth.
All Good Things Must...You Know
All Good Things Must...You Know
In fact, according to this study by Ampere Analysis, the year on year growth between 2019 and 2020 showed a jump from $151 billion in revenue to $182 billion - massive compared to YoY growth between the previous 5 years. And, while nowhere near as large, the market still showed YoY growth between 2020 and 2021 to $191 billion.

However, the study, based on a number of financial models, predicts that 2022 will end with a slight decline to around $188 billion in revenue - not terrible, but still not the hockey stick growth publishers and studios have seen for the last 7 solid years.

Your first instinct might be to immediately blame this on inflation and the current state of the US economy. However, the study goes into great detail about the fact that this decline will be as a result of a number of different factors coming together. Let's go over them:

First there are ongoing supply chain issues which have been affecting general production of PCs and consoles for all of late 2021 and 2022 - and notoriously delayed the release of the Steam Deck from holiday 2021 to February 2022 and beyond (I'm still waiting on mine).

Then there's the fact that a recent resurgence in COVID cases in China have caused another massive shutdown in the country - resulting in closures of most of the popular Internet cafes where a large majority of gaming revenue is generated there.

Then there's the fact that studios have almost completely removed support for their games from the Russian market following their invasion of Ukraine.

The study does, however, note that ongoing US inflation issues are also a factor. All in all, there are several contributing factors to the market's upcoming challenges.

It's not all doom and gloom, though. The same study also predicts that the market will actually recover in 2023, and predicts revenues that year to be upwards of $195 billion.

How do you feel about this prediction?
You may also like
More on news