July 06, 2022
Today’s edition: 916 words, a 3.5-minute read.
1 big thing: Industry contraction concern
The global video game market will shrink in 2022, according to a new industry analysis that blames multiple factors.
Why it matters: If correct, it’ll prove that gaming, which surged at the onset of the pandemic, doesn’t operate in a bubble.
- Researchers at Ampere Analysis predict a 1.2% market decline for the year, from $191 billion to $188 billion.
- For context, growth had been rapid for years, rocketing up from $95 billion in 2015, according to Ampere.
Between the lines: The expected downturn is blamed on declines in most major gaming sectors and the impact of “heavy inflation, with an increasing cost-of-living squeeze.”
- Ampere sees mobile gaming taking a 1.3% hit, down to $111 billion due to revamped privacy settings that have stymied established advertising and user acquisition models.
- PC gaming could dip due to the pandemic’s closure of gaming cafes in Asia, and the console market is pegged for a slight drop due to hardware manufacturing woes and game delays.
- Ampere only predicts growth in subscription services, to $300 million, but it's a meager portion of the overall industry.
What they’re saying: “The idea that the games market is ‘recession proof’ is a fallacy,” states the Ampere report.
- But it also notes that gaming offers a high value for money spent, offering some hope that cash-strapped people will still find it worthwhile to play and pay.
- In May, Take Two chairman Strauss Zelnick offered a similar take. He told investors that gaming “will be affected by an overall slowdown,” but noted that the industry wasn’t hit as hard as others in 2009.
- Last week, Nintendo president Shuntaro Furukawa shared a rosier view with stockholders: “In terms of the impact of global inflation on our current business, our entertainment business generally has not been affected by macroeconomic considerations.” He noted reports about inflation in Europe and the U.S. but said they didn’t have a “major effect on our sales at the moment.”
What’s next: The bad news may be short-lived. Ampere expects gaming to return to growth in 2023, reaching $195 billion.
- Senior researcher Piers Harding-Rolls tells Axios that uptick may come from an improvement in the console supply chain, the release of delayed games and breakthroughs in mobile once new user acquisition strategies are figured out.
- Plus: He predicts that a post-lockdown “swing away from gaming” may give way to a “swing back a bit later.”
2. WNBA 2K
NBA 2K23 will break a new barrier in gaming by having two WNBA athletes on the cover for the first time, Diana Taurasi told Axios' Herb Scribner in a recent interview.
Driving the news: WNBA stars Taurasi and Sue Bird will grace the cover of the WNBA edition of 2K23 opposite Michael Jordan, who will be one of two cover athletes for the regular edition of the game, 2K officially announced today.
- The WNBA edition, however, will be available only at GameStop.
What they're saying: "It's pretty amazing," Taurasi told Axios. "All my life, I've played video games, especially earlier in my life. And there was nothing like the cover of the game. It just said so much about where that sport was and the legacy it was leaving. And to think that Sue and I are on the cover of 2K, it's pretty amazing because it's just built into basketball culture."
- Taurasi said she would have loved seeing former WNBA stars Cynthia Cooper, Cheryl Miller, Ann Myers, Lisa Leslie and Dawn Staley on the cover of previous video games.
- "There's a lot of players that can carry that crown," she said.
3. Need to know
🎮 The U.K.'s Competition and Markets Authority has opened an inquiry into Microsoft's bid to buy Activision Blizzard to determine whether the deal would unfairly hinder competition, the agency announced.
😲 Multiplayer game Fall Guys attracted 50 million players in the two weeks since it switched to a free-to-play business model, its developers say.
🤔 Square Enix's Forspoken, an original action-adventure set for October release, has been delayed until January, the company announced.
- Instead of the standard explanation of needing more time in development, the delay was attributed to "ongoing discussions with key partners."
🚫 A speedrunner who participated in last week's Summer Games Done Quick event secretly used pre-recorded footage instead of playing live and has been banned from the event, Kotaku reports.
📱 Ubisoft's mobile Division game will be a third-person open-world shooter, the company revealed today, as the line between console/PC genres and those on mobile blur.
🃏 CD Projekt Red is releasing a single-player Witcher card game called Gwent: Rogue Mage ... tomorrow, IGN reports.
4. Looking back: God of War a decade ago
Sony finally announced today that the highly anticipated PlayStation exclusive God of War Ragnarök game will go on sale on Nov. 9.
- A delay to 2023 had seemed possible.
- And the harassment of the game’s creators by some so-called fans got so ugly that Ragnarök’s development studio, Sony Santa Monica, issued a public plea for civility.
- Sony accompanied the release news with a short, non-gameplay video.
Ragnarök’s gradual unveiling, since its September 2020 announcement, has been all virtual.
- Traditional in-person gaming showcases for the press and public have all but been shut down due to the pandemic.
It’s a different experience than the roll-out of the many big God of War games in years past.
- In this week’s throwback image, we’re looking at the E3 event in June of 2012.
- That’s a line of kiosks showing God of War Ascension, which would be released the following year.
- Maybe we’ll get a sight like that for Ragnarök's eventual sequel.
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🐦 Find me on Twitter: @stephentotilo.