The gaming industry has evolved over the years in terms of technology and revenue generation. From the dawn of arcades to the rise of consoles and video games to the current trending blockchain and virtual reality technology, the gaming industry has exponentially risen over the past few decades.
The gaming industry has been making significant gains each year in terms of record sales and unfathomable market reach. At the moment, gaming is the biggest earning media sector. It was valued at $198.40 billion in 2021 and is expected to rise to $339.95 billion by 2027
Here’s a peep into how the gaming industry has evolved most importantly from the era of Consoles to the current rise of blockchain and virtual reality technologies.
The arcade market
Early video game prototypes started being developed back in the 1960s although it is the famous Pong game that was released by Atari in 1972 that brought the industry to life. The arcade table tennis game became sensation drawing players from around the world and companies started producing their knock-off versions.
By 1982, arcades were already generating more revenue that the pop music industry and box office thanks to new franchises like Donkey Kong, Pac-Man, and Space Invaders.
But at the same time a new technology, the home console, had been invented and was slowly gathering momentum. Atari was the first to sell a home console which version of the Pong in 1975, and later its own Atari 2600 home console in 1977, which went ahead to sell more than one million units.
The rise of home consoles
With technological advancements, the gaming industry was growing at a very fast rate that seemed hard to maintain. Eager to capitalize on the growing home console market gaming companies including Atari started releasing poor-quality games that made the industry slump for a while.
However, at the same time personal computers have started gaining preference within the gaming industry, especially after the release of the Commodore in 1982.
A technological race has started. The likes of Duck Hunt, Excitebike, Mario in Super Mario Bros, and NES were released in very quick succession. And before long the competition and marketing had shifted to the processing power.
In 1994, Electronics maker Sony released the PlayStation, which used CD-ROMS instead of cartridges for storage. The game went on to the first console to sell over 100 million units. Following its success, the focus shifted to software formats, and PlayStation 2 (which used DVDs for storage) and PlayStation 3 (which used Blu-rays) were released in quick succession.
At the time, even Microsoft realized the importance of gaming on personal computers (PCs0 and developed the DirectX API to help in game programming. The “X’ brand eventually made its way into the console market through the Xbox.
The internet age
It was the rise of the internet and mobile phones that thrust the revenue generated by the gaming industry from tens of billions to hundreds of billions.
The introduction of subscription and freemium services was the greatest contributor to the sudden surge in revenue. Microsoft was among the first companies to introduce monthly subscription fees after launching the Xbox Live online gaming platform that required one to make monthly subscriptions.
Xbox also gave players access to multiplayer matchmaking and voice chat services, making it a must-have for most gamers.
As Microsoft concentrated on PC gaming, Blizzard was exploring the massive multiplayer online (MMO) subscription market curtsey of the rising popularity of internet coverage. The release of World of Warcraft in 2004 took the MMO market by storm after hitting 14 million monthly paying subscribers.
All along, companies were struggling to tap into mobile gaming with companies like Nintendo holding onto the handheld market with updated Game Boy consoles. Meanwhile, Blackberry and Nokia were trying their hand at integrating game apps into their phones. But it was Apple’s iPhone that stumped the transition to mobile gaming platforms.
Now, the mobile gaming industry is worth over $85 billion.
Console makers like Sony and Microsoft are competing to launch cloud-based subscription services as they continue to develop new consoles. On the other hand, other companies like Google and Amazon are launching services that work on multiple devices from PCs to mobile. Games like “Pokémon Go” and “Grand Theft Auto V” made history by generating yearly revenue of over $1 billion each.
Blockchain and virtual reality
Presently, with the rise of virtual reality and blockchain technology coupled with the proliferation of smartphones, streaming services, and social media games, there are currently over 2.7 billion gamers around the world.
First, it was games like Jurassic World and Hitman 3 that became increasingly popular for bringing a virtual reality feeling to players.
Then came the spontaneous rise of blockchain and cryptocurrencies and specifically the non-fungible tokens (NFTs) that led to a new gaming concept called play-to-earn where players earn crypto tokens as they entertain themselves during gameplays.
Examples of some of the play-to-earn crypto games that have currently taken the gaming industry by the storm include Decentraland, Axie Infinity, and The Sand Box among others.
Conclusion
When it comes to the gaming industry, one can only imagine the industry expanding further and further with new technology advancements.
Cloud gaming, the metaverse and augmented reality are expected to be the main driving factors as the gaming industry becomes more mainstream.