Video Game Market Trends in 2024
As the results of 2023 have shown, the video game market is highly promising and actively growing, demonstrating an increase in both revenue and the number of players. However, developing games, especially big-budget AAA games, is a lengthy and labor-intensive process. And the more expensive and technologically complex games become, the longer the development cycle gets. In such conditions, where embarking on a project requires long-term commitment, it's impossible to adjust the business strategy "on the fly". Therefore, many market players rely on expert forecasts to avoid setting off down an unprofitable path. Last year proved relatively successful for the industry. Let's see if experts think this trend will continue in 2024.
Video Game Market Revenue
According to Newzoo analysts, the revenue of the gaming market in 2024 will reach $189.3 billion (up from $184 billion in 2023). Experts predict stable growth of approximately $8 billion per year for the next two years (reaching $197.1 billion in 2025 and $205.7 billion in 2026), which is higher than the increase in 2023 compared to 2022. Thus, in 2025, revenue will exceed the 2021 figure ($192.7 billion) — the highest in the last three years as a result of the pandemic.
Video Game Market Revenue (Newzoo)
PC and Consoles
The future looks bright for this market segment. After a decline in 2022, revenue picked up momentum in 2023, and experts expect this trend to continue in 2024.
Marc Regeur, senior director of business development at Steer Studios (Savvy Games Group), is convinced that 2024 holds many interesting developments for the video game industry. He predicts an increase in the number of multiplayer games focusing on social interaction between users (both PvE and PvP projects). He also believes that games will include more content created by players themselves, which they will gladly share with the community.
Romain Bingler, responsible for market strategy at Ubisoft, believes that 2024 will be a year of stabilization: he expects the industry to avoid significant fluctuations and disruptions this year. Although there will be challenges, Bingler believes that new opportunities will open up for market players.
André Persson, head of the Project 369 Group, also points to the post-pandemic "shake-up" of the industry: studios are closing and game companies are laying off employees en masse, but new studios are emerging, so the market still offers attractive opportunities. In addition, investors have become more cautious, which, according to Persson, will increase the demand for research and expert opinions in this field.
One growth factor in the PC and console segment will be the increasing number of owners of the latest generation consoles — Xbox Series X/S and PlayStation 5. The list of releases planned for 2024 is less impressive than last year. However, live-service games and sales of already released titles are expected to generate significant revenue.
Playing on Nostalgia
According to a Newzoo survey, the majority of experts agree that game companies will be reluctant to take financial risks, so there will be fewer new IPs. Instead, the focus will be on new games of well-known franchises. There will also be all kinds of reimaginings, such as last year’s Assassin’s Creed Mirage, which was marketed as a return to the series’ roots. The game was significantly smaller in scale than the franchise's recent games about the Hidden Ones, more reminiscent of the earlier installments in the series. The developers played on the fans’ nostalgia, and this approach will be widely used over the coming year, including through the release of remakes of popular games from the past. Experts also believe that companies will increasingly move away from the free-to-play distribution model (free games with in-game purchases) in favor of games that must be purchased. According to 2023 data, players are increasingly choosing paid games if they are of sufficient quality.
Subscription Gaming Services
Live-service games will remain a priority for companies, which will also impact the potential popularity of new projects. This is because of the nature of live-service games, with regular content additions and long-term player engagement leaving less time for players to explore new titles. As a result, rapid growth is not expected in the number of new live-service games: players’ time is limited, and they tend to stick with their favorite games (where they may have friends, too), rather than switching to new titles, or dividing their time between multiple similar games. Thus, on the one hand, we may soon see the oversaturation of the live-service games market. On the other hand, this might push developers to innovate and seek new gameplay loops and mechanics instead of simply replicating successful projects.
Regarding subscription gaming services, although experts predict an increase in the number of users, overall growth in this area is expected to slow down over the next three years, according to Newzoo analysts. Indie developers are becoming less willing to make deals with subscription service owners. It can be difficult to predict how successful a particular project will be, especially for games from small independent studios that cannot afford a lot of advertising and promotion. Often, a game could earn significantly more in sales than if it were added to a subscription. This is also relevant for larger independent studios whose financial well-being depends heavily on the success of a particular project.
Baldur’s Gate 3, released last year, is an excellent example of such success, which surpassed the expectations of even the developers themselves. The game won numerous awards, such as five Golden Joystick Awards and six The Game Awards, including "Game of the Year," and sold several million copies. Swen Vincke, head of the development studio, said that the game will not appear on subscription services.
Speaking of the value for players, at first glance, a subscription may seem like an enticing offer, giving access to an extensive catalog of games (many available from the day of release) for a relatively small monthly fee. However, in reality, the popularity of game subscriptions is not growing as rapidly as subscriptions for movies and music. The reason is simple: completing a game usually requires much more time than watching a movie or listening to an album. What’s more, games are a form of active entertainment, requiring players to invest time and effort and deeply immerse themselves to get the full enjoyment. As a result, users often simply don't need many games at once, and many still prefer to buy the titles they want to try and play them at their own pace.
Release of the new Nintendo Console
The release of a new Nintendo console is expected in 2024, along with a 3D Mario game. Analysts believe that the company will allow players to use their existing Switch account to play their favorite games on the new console.
Popular game genres on PC and consoles
Regarding gaming genres on PC and consoles, analysts predict a surge in the popularity of open-world "soulslike" games (projects borrowing game design elements from the Dark Souls series). Planned releases for 2024 include Another Crab’s Treasure, Rise of the Ronin, Black Myth: Wukong, Enotria: The Last Song, and Flintlock: The Siege of Dawn. This trend can be attributed to the great success of Elden Ring in 2022, which, by the way, is expecting a major expansion called Shadow of Erdtree.
Extraction shooters have also become increasingly popular, as exemplified by Escape from Tarkov, Hunt: Showdown, and Dark and Darker. New games within this genre are now in development, such as Marathon, Arc Raiders, and Exoborne.
Some experts believe that mobile game developers will increasingly begin releasing projects on PC and consoles in 2024. In 2023, there was a slight decline in the mobile segment for the second year in a row, caused by stricter privacy policies from platform holders. So, we saw developers beginning to invest more actively in the support of already released games instead of creating new ones. Experts believe that in 2024, studios will strive to diversify their sources of income.
One way is to release existing mobile games on PC, thereby giving players the opportunity to access their favorite games from different devices. Another way is to develop new games for PC and consoles. This way, mobile game developers will be able to explore a new segment, applying their extensive experience in attracting and retaining players. Some major developers have already opened new studios focused on creating games for other platforms.
Privacy Policies Impacting the Gaming Market
Most analysts also agree that privacy policies will continue to impact the mobile gaming market this year. However, for platform holders Apple and Google, there is an interesting twist around the corner: due to changes in legislation (the EU Digital Markets Act), they are now required to allow the integration of third-party app stores into their ecosystems.
Microsoft plans to take advantage of this by launching its own mobile app store on Android in 2024, as many analysts believe (it will appear in the Apple ecosystem a bit later). With the takeover of Activision Blizzard last year, Microsoft also acquired King, whose portfolio includes one of the most popular mobile franchises: Candy Crush. The launch of Microsoft's own app store will bring advantages for Xbox, allowing them to leverage the potential of cloud gaming and provide access to games from the Xbox Game Pass subscription service on mobile devices.
According to Statista's forecast, the revenue of the AR and VR market is expected to reach $38.6 billion in 2024. While AR is in high demand in manufacturing industries, VR technologies are most rapidly developing in the gaming industry.
Despite a slight decline in interest in VR games after the pandemic, last year saw the release of new virtual reality devices (such as the PlayStation VR 2). Virtual reality titles continue to be released at a steady rate, with a variety of new games planned for this year: Skydance’s Behemoth, Into the Radius 2, Bootstrap Island, CONVRGENCE, Wanderer: The Fragments of Fate Remake, The Burst, Stranger Things VR and more.
Neural Networks in Game Development
Most experts believe that in 2024, game companies will actively incorporate neural networks into their development processes. Although this topic sparked a lot of debates and concerns last year, many studios are already using AI technologies in their work, and are likely to rely on them more and more in the near future.
Nevertheless, significant changes in game production are not expected in 2024. The use of neural networks will be limited to already tested scenarios and the creation of secondary content.
As we've seen, the gaming market, while showing stable growth year on year, is still influenced by trends — just like any other industry. In the gaming industry, trends often change faster than the production cycle can be completed; as a result, finding ways to increase return on investment is particularly important. One way to increase your chances of financial success is to enter markets in other regions. With our many years of experience in translation, as well as a deep understanding of the gaming industry, Logrus IT can help you plan and implement localization into other languages.