Global social gaming market is estimated to witness high growth, owing to increasing digitization and emergence of 5G infrastructure
Global social gaming market is estimated to be valued at USD 31.06 billion in 2024, exhibiting a CAGR of 16.4% over the forecast period (2024-2031). Growing adoption of smartphones and access to high-speed internet connections have enabled seamless gameplay across various social media platforms.
Market Dynamics:
Global social gaming market growth is driven by increasing digitization and emergence of 5G infrastructure. 5G networks provide seamless connectivity for real-time online gaming with high-definition graphics and near-zero latency. This can boost interactive and immersive social gaming experiences. Moreover, COVID-19 pandemic has boosted adoption of digital technologies as people spent more time online for social interactions, entertainment and gaming. Lockdowns imposed globally boosted popularity of social gaming platforms. Increasing number of online gamers and e-sports enthusiasts can also hamper the market growth. However, concerns around cybersecurity and data privacy can pose challenges for market players over the forecast period.
Increasing user engagement through continuous game updates and new features can drive the market growth
Global social gaming market can witness growth due to ability of developers to continuously engage users through regular updates and new features in existing games. As games evolve over time with new levels, challenges, gameplay mechanics and social integrations, users are incentivized to keep coming back on a regular basis. This increases the monetization potential through in-app purchases and advertisements. Many big gaming companies have live operations teams that work on analyzing user behavior and feedback to introduce new engaging content on a frequent basis, like weekly or bi-monthly. This helps them retain existing users for longer periods and attract new users through viral sharing.
Rising popularity of free-to-play business model
Global social gaming market can witness growth due to widespread adoption of the free-to-play business model. By making their core games available for free on various platforms, developers are able to attract a much larger user base globally. These then effectively monetize huge volumes of active users through various in-app monetization mechanisms like premium features or virtual goods within the games. As users get hooked to the gameplay mechanics and social engagement aspects, these become willing to make small incremental payments regularly to boost their gaming experience. This has significantly enhanced the commercialization potential of social gaming titles, thus, driving higher revenues for successful companies.
Lack of dedicated gaming devices can hamper adoption
Global social gaming market growth can be hampered due to lack of dedicated gaming devices with always-on internet connectivity. While smartphones have enabled seamless mobile gaming experiences, these are still general purpose devices being used for varied tasks beyond just gaming. This restricts the amount of time users can dedicatedly spend playing games on such devices. Dedicated portable gaming devices with large screens and exceptional battery backup could potentially address this issue by offering immersive experiences optimized solely for gaming. However, high costs and other form factor limitations have prevented such devices from gaining popularity. This has restrained the market from reaching its full potential in terms of user engagement levels and monetization.
Piracy and copyright infringement
Piracy and copyright infringement of premium gaming content can also hamper the social gaming market growth. While the free-to-play model has made original game experiences freely accessible, it has also inadvertently enabled wider illegal distribution of premium in-game virtual items and character levels. Various software tools allow users to hack game code and acquire such premium virtual goods without actually paying. This results in significant lost revenues for developers. Combating piracy through technology and regulations can limit the commercial success of even the most popular gaming titles in some regions. Stronger copyright laws and anti-piracy measures need to be established to address this restraint.
Emergence of AR and VR platforms present new monetization avenues
Augmented Reality (AR) and Virtual Reality (VR) platforms offer growth opportunities for social gaming companies. As AR/VR hardware becomes more affordable and user-friendly, it can offer immersive new gaming experiences beyond the limitations of traditional smartphone and PC formats. Popular game franchises having strong social and multiplayer dimensions could witness enhanced monetization, if ported to these new platforms with supportive devices. Developers successfully tapping into the AR/VR wave may gain a competitive edge by establishing their brands early within these new interactive mediums. Generous investment and partnerships will be crucial to capitalize on the untapped commercial prospects arising from immersive technologies.
Expanding 5G proliferation to boost remote engagement
Global rollout of 5G mobile networks presents another potential opportunity for social gaming businesses. As ultra-high speed internet becomes more pervasive worldwide, it can facilitate deeper social engagement among remotely located players in real-time. Advanced multiplayer modes, live spectating, communication features and cloud gaming mechanics may witness increased adoption on responsive 5G networks. This could attract a fresh demographic of users seeking more immersive shared experiences beyond current technical limitations. Pioneering companies developing innovative “5G-first” gaming concepts can gain first-mover advantages before mainstream 5G adoption over the next decade.
Link - https://www.coherentmarketinsights.com/market-insight/social-gaming-market-4357
Key Developments:
- In February 2024, Playtika Holding Corp., a prominent mobile gaming entertainment company recognized for its popular social casino games, merged with a gaming analytics firm to boost its user experience and engagement strategies. This strategic move is designed to utilize advanced analytics to gain deeper insights into player behavior and preferences, ultimately enhancing game design and increasing player retention. By incorporating cutting-edge analytics solutions, Playtika aims to strengthen its competitive edge in the mobile gaming market and deliver more personalized and engaging gaming experiences.
- In October 2023, Activision Blizzard, a leading interactive entertainment company famous for its Call of Duty franchise, unveiled a new social feature in Call of Duty: Warzone to enhance player engagement. This feature is intended to improve the multiplayer experience by enabling more fluid communication and collaboration among players, thereby fostering a stronger community within the game. The introduction of this social feature reflects Activision Blizzard's ongoing commitment to refining and expanding the Call of Duty: Warzone experience, as demonstrated by the recent release of Call of Duty: Modern Warfare III and the forthcoming Call of Duty: Warzone Mobile.
- In March 2023, Tencent Holdings Ltd., a major Chinese multinational technology conglomerate and a key player in the gaming industry, expanded its gaming studios in North America to boost its market presence. This strategic expansion aims to solidify Tencent's position in the competitive North American gaming market, enabling the company to better develop and release its popular titles while fostering partnerships with local developers. By enhancing its studio capabilities, Tencent seeks to capitalize on the region's robust gaming ecosystem and meet the growing demand for interactive entertainment.
- In September 2022, Roblox Corporation, a leading online platform that enables users to create and play games, collaborated with several brands to host in-game events and experiences. This initiative is designed to boost user engagement by incorporating branded content into Roblox's immersive environments. By partnering with various companies, Roblox aims to create unique interactive experiences that appeal to its diverse player base, further reinforcing its position as a major player in the gaming and entertainment industry.
- In April 2021, Electronic Arts Inc. (EA), a global leader in interactive entertainment, finalized its acquisition of Glu Mobile Inc., a notable mobile game developer known for hits like Covet Fashion and Kim Kardashian: Hollywood, for US$ 2.1 billion in enterprise value. This acquisition aims to enhance EA's mobile gaming portfolio by merging the strengths of both companies, resulting in a leading collection of over 15 top live services across different genres. The integration of Glu Mobile's expertise and extensive player base is expected to accelerate EA's growth in the mobile gaming sector, the largest gaming platform worldwide.
Key Players:
Zynga Inc., Electronic Arts (EA), Activision Blizzard, Inc., Tencent Holdings Limited, Supercell, King Digital Entertainment, Niantic, Inc., Roblox Corporation, Epic Games, Inc., Playtika Holding Corp., Gameloft SE, Bandai Namco Entertainment Inc., NetEase, Inc., Square Enix Holdings Co., Ltd., and Ubisoft Entertainment S.A.
