Kaavya Karthikeyan, Author at Gameopedia

Advertising in Video Games

The global market for video games has grown exponentially over the past decade and 2022’s revenue is projected to reach $219.90 billion. This comes from a variety of segments within gaming, which we’ve covered in detail in our game monetisation article. Long gone are the days when game revenue came from physical or even digital sales of copies. These days, subscription services, in-app purchases (IAPs), and advertising all contribute just as much, if not more, to revenue. 

The biggest chunk of video game market revenue, a whopping $91.4 billion in 2021, comes from smart-phone games and is more than the PC and console markets combined. In 2019, a survey conducted by deltaDNA found that 94% of free-to-play video game developers incorporate some form of in-game advertising. Knowing these facts, we’re going to zoom in on one particular sector here, which is advertising in games.

It makes sense to look at how advertising in games works and how it came about, considering that the global video games advertising market is expected to reach $4.8 billion by 2024.

The History of Advertisements in Gaming

From the above data, the question arises, how did game makers realise the potential of generating revenue through advertising? The first ever ad in-game was actually not a commercial one, but that of a game developer trying to generate interest for his next game. Scott Adams, the creator of Adventureland left a message promoting his next game, Pirate Adventure.

Scott Adams created hype for his next game through his first, Pirate Adventure.

After this (relatively) wholesome ad though, game devs and brands alike took a note from movies and TV shows. They saw how the latter did product placement and wanted to replicate it in games but they faced some hurdles. In movies and shows, you can see the world in great detail so including a product or two doesn’t look odd. A character casually drinking Coca Cola or lacing up their Nike shoes doesn’t affect the quality of the production. In games however, the graphics then weren’t great enough to include most products organically. Thus, the gaming industry came up with another way to partner with brands and those were advergames. 

Advergames are games made exclusively for advertising purposes. The first released advergame was Tapper in 1983.  The game had been originally sponsored by brewer Anheuser-Busch, and featured the brand’s logo with gameplay based on serving beer. The game proved so popular that a non-branded version of the game, Root Beer Tapper, was released for general arcades, with the beer replaced by root beer to cater to younger audiences. In the 80s and 90s, numerous advergames were released (though the term only came into existence in 1999) and with graphics improving significantly, new advergaming opportunities appeared. For instance, car manufacturers couldn’t really show off their cars in games until graphics improved enough by the 90s and games like Driver and Need for Speed really took off (though they didn’t show these vehicles being damaged even if you were an awful driver because bad for business, but we digress.)

While ads these days in games are mostly annoying, back then, a lot of the released advergames were actually quite popular and… fun. Chex Quest, a cereal-themed child-friendly remake of Doom, was a huge hit and is till date, considered one of the best advergames made. Advertisers also experimented with different kinds of product placements. They had ads integrated into splash screens (McVities Penguin Chocolates in James Pond Robocod, 1991), they made their mascots characters in-game to avoid directly mentioning their products (Ronald McDonald starring in McDonald’s Treasure Land Adventures, 1993), and they even weren’t below taking potshots at their competition. The latter in particular was interesting: Coca Cola worked with Atari to redesign their mega-hit Space Invaders for one of Coca Cola’s sales conventions. The aliens you had to shoot would spell out ‘Pepsi’ on the screen. A rather on the nose shot. 

Chex Quest was one of the most popular Doom remakes released.

In 1999 though, Crazy Taxi rewrote the classic advergame template, where the brand was no longer the center of the game but instead, just a facet. In the game, you’re a taxi driver picking up a passenger and taking them to where they want to go, which are places like Levi’s store or Pizza Hut. You could also see other brands and stores enroute, and the placement of all of these were organic enough for gamers to appreciate the realism. A case of where art imitates life (a tad ironically) arose in games like Madden, NFL, and FIFA. They all had to pay licensing fees to incorporate details from the real-life leagues and to offset these, they started getting into sponsorship deals with brands to show them prominently in-game. 

In 2005, a game called Splinter Cell: Chaos Theory used what we call now as ‘dynamic advertising’ where the ads shown were relevant to players. This audience segmentation, as it is known, was first done by Splinter Cell’s developers Ubisoft, though the industry followed suit soon.

Of course, if you’re going to be overly heavy handed with in-game product placement, especially if it doesn’t make sense in the game universe, your audience isn’t going to be very happy about it. EA found this out to their chagrin when their billboards for Pepsi and Intel in Battlefield 2142, a game supposedly set a century in the future, were disliked strongly by players. To give them their due, they did eventually remove the ads from the game but it was one of the first games where the negative side of putting ads in your game really showed up. 

When mobile gaming started to take off, it led to a change in game design and how games were monetized. Games were now often F2P with their main revenue coming in from ads. We’ve covered how exactly mobile games are monetized in our article about them if you want the details, but a lot of different kinds of ads began being made and incorporated into games. We’ll head into the different types of ads in a later section but suffice to say, ads in games were here to stay. However, not all game developers took care that these ads were ok with their customers. Often, mobile games have the issue of showing too many ads. You clear a level? Ad. Lose a life? Ad. Open the app? Ad. This sort of nagging by a game would be bad enough but since a lot these games derive most if not all of their revenue from ads, they feel the need to make levels shorter and squeeze in as many adverts as possible to maximise revenue, to an extent sometimes where games become almost unplayable. 

Finally, both AR and VR have also started seeing the potential of ads to generate revenue. In Pokemon Go, Niantic added advertising which showed up depending on which location you were at, bringing the real and virtual world together. While there are no conventional banner ads in Pokemon Go, they still have sponsored Poke Stops, free items in-game from companies that support the game which you can claim by looking at an ad, and even some sponsored cosmetics but so far, all of these have not messed with the game’s immersion. On the VR side of things, Volvo made an app that uses VR glasses to test drive their XC90 SUV. In fact, by 2022,  the number of annual installs of AR and VR apps will grow by 45% compared to 2017, and the market for in-app purchases will increase by 92%.

The Types of In-Game Advertising

We can see from our history of game advertising that there are several ways of placing products in-game. Different methods of advertising work for various products, game devices, or even game genres, and especially with mobile game ads, a lot of variety has popped up. Let’s look at the major types.

Static Advertising/Product Placement:
Static in-game advertising is when ads are coded right into the game and can’t be changed (unless the game is completely online.) These advertisements are planned and integrated into a video game during the design/development stage, and as such, can be integrated in a customised manner. For example, Splinter Cell used in-game Sony Ericsson phones to catch terrorists. Unlike conventional static advertising in real life, static ads in game allow players to interact with the product being advertised. Ads are also incorporated on billboards, especially in sports games, analogous to how it happens in reality.

  • Advergames:
    These are custom-made games which are built for promoting a particular product or brand through its story, environment, or gameplay. Advergames can also offer players benefits in real life through coupons, discounts, and the like. These games are a fun and entertaining way for brands to connect with their customers if done right.
    Examples of great advergames include Cool Spot from 7up, Sneak King by Burger King – this led to a 40% increase in sales revenue for Burger King, McDonald’s Treasure Land, and Pepsiman by, well, Pepsi.
  • Dynamic In-Game Advertising
    Dynamic advertisements are those which consider various factors such as location, age, personal interests, and more before displaying ads. These are personalised ads at scale and using dynamic ads, any brand can segment people who use their app or website and show them products and services they have a keen interest in. They allow game developers/publishers or the ad delivery service to track their ads in real-time and get data such as angle from which the ad is viewed, screen-time spent, and more to correct issues and improve existing and future ads.
    There are various kinds of dynamic ads, some of which include:
  • Diegetic dynamic ads: These are dynamic ads which are seamlessly placed in the video game world. This allows media buyers to purchase real-time and geo-targeting capable advertising inside of video games. The adverts appear inside the game environment, on virtual objects such as billboards, posters, and bus stops – all of which are objects that you’d expect to see in a realistic sports or urban environment video game. Tony Hawk: Ride is an example.
  • Interstitial ads: According to Google, interstitial ads are full-screen ads that cover the interface of their host app. They’re typically displayed at natural transition points in the flow of an app, such as between activities or during the pause between levels in a game. When an app shows an interstitial ad, the user has the choice to either tap on the ad and continue to its destination or close it and return to the app, though often, games force users to sit through several seconds of the ad which can be quite frustrating. Video ads are a popular kind of interstitial ad in games.
  • Banner Ads: These are advertisements present in the form of banners in the game. They may be displayed at different positions like the top, bottom, or side of the screen. They may occur at different instances in the game such as in the main menu, during gameplay, between levels, and more.
  • Reward ads: These are ads which are basically an in-game exchange offer: users view ads for in-game rewards like extra lives, boosters, and the like. Candy Crush is a good example of a game with good reward ads. Since these ads are optional and users can choose to avoid them, they aren’t as negatively looked at and they even increase in-app purchases. However, unlike interstitial video ads, some of these are not skippable.
  • Playable ads: These are mini games users can try out and if they like it, they can install the complete app. They make for a great user experience and have some of the best conversion rates. Tennis Clash and Royal Match both are popular playable ads.
  •  Offerwall ads: These tend to list out tasks that users can complete in exchange for in-game rewards. They act almost like a mini online store and since they’re optional, they aren’t frowned upon as much as ad barrages. They also increase time spent on apps significantly by extending the session length.
  • Through-the-Line Advertising
    This is a kind of advertising that involves the use of URL hyperlinks within the game to get players to visit web-pages with advertisements. The technique used to tempt the player into visiting the intended URL varies from game to game.
    In games such as Enter the Matrix, Year Zero, I Love Bees, and Lost Experience, URLs make up a part of the background of the game such that certain plot details can only be learned by following the link.

Why Ads are a Necessary Evil

Advertisements have their benefits (at least for game development companies and the companies placing the ads) but they have more than their fair share of issues. While ads are great in a way that they keep games F2P, especially when it comes to mobile games, they can often prove to be extremely annoying, tasteless, or even downright misleading. Let’s look at the good, bad, and ugly when it comes to in-game advertising.


  • The biggest point in the favour of advertisements in-game is that they can create new revenue streams. By adding ads to games, companies can reduce the price they’re sold at, and even make them free, as seen by the F2P model pioneered in mobile devices. When Angry Birds was ported to Android devices, it was released as a free game with ads and even if users opted not to pay to remove ads, they could still enjoy the game. King’s release of Candy Crush Saga as a F2P game right off the bat propelled it to the top of the charts. In just more than a year, King had seen over 400 million new players of the game and their revenues had jumped from $62 million in 2011 to $1.88 billion from advertising revenue and in-app purchases.
  • In-game ads which promote a popular artist or concept can also boost your own game. For example, in 2021, Fortnite announced the continuation of its cooperation with the Jordan brand. Players can compete for the Air Jordan XI Cool Gray, the iconic sneaker model, and discover rooms dedicated to the best basketball players. The MVP gets access to a virtual museum, a basketball court to test your abilities and an immersive video that advertises the Jordan brand.
Fortnite's collaboration with the Jordan Brand worked out great for both of them.
  • A 2009 study by an advertising company found that 80% of consumers correctly recalled an advertiser and 56% had a more favorable impression of the advertiser because it allowed them to play a free game. This is especially relevant when it comes to advergames and mobile gaming, though in the past decade, it’s more of the latter. FIFA and other popular licensed sports franchises made extensive use of in-game product placement and advertising, on billboards, jerseys, and more. Since these franchises already have a great deal of sponsorships and ads in real life, in game, it didn’t cause eyebrows to be raised.
  • In-game advertising is an important source of income for browser-based and other Internet games that do not feature micro-transactions or pay-to-play. Websites like miniclip, pogo, and kongregate all feature free games one can play online and they offset their expenses with ad revenue. 


  • Integrating IGA into games without alienating or frustrating players can be hard, especially if done overtly. A lot of mobile games tend to slam ads between every level, if you fail a level, and as soon as you open or close the game. They also tend to shorten levels to increase the number of ads opened and this can make playing them really frustrating.
  • Some games market themselves as something they aren’t: titles like Homescapes which is basically a match-3 puzzle game is peddled as, well, a fixer-upper game in ads. This kind of misrepresentation leads to a lot of downloads but it also causes games to look at mobile titles with increasing resentment and scepticism. This is more of a marketing issue than being specific to ads.
  • Game companies and developers worry that they may be forced to change the game as requested by advertisers if in-game adverts become a common revenue source, and face a possible backlash from consumers. However, certain kinds of ads, such as reward ads are actually looked at favourably by users and removal of them can lead to customer dissatisfaction. 
  • Like in any other industry, false advertising is an issue in games as well. In one rather notable instance, the Gatorade company had published a free mobile game Bolt! which featured Usain Bolt and challenged the player to “keep your performance high by avoiding water”. The state of California asserted this claim was false, as Gatorade had been shown to be more harmful to the human body than water. Since the game was targeted towards kids and teenagers, this gave the state cause to sue Gatorade. The case was ultimately settled with Gatorade paying a $300,000 fine to the state. This case might have had a happy ending (except for Gatorade). However, misleading claims and even F2P games that promote toxicity are still around. For example, ads on Facebook for a F2P mobile game called ‘Game of Sultans’ literally imply that abuse can make women listen to you. The lack of regulation when it comes to both game making and ads like this can prove deeply harmful.
Ads like this can lead to increased online toxicity and negativity. The lack of regulation surrounding in-game adverts is horrifying.
  • In-game advertising can also lead to negative reviews for a video game because the ad doesn’t make sense or just seems very insulting to players. A great example of ads being despised by games was Maxis’ promotion of a heavily branded Nissan Leaf charging station as downloadable content in SimCity. This being the first DLC for the game was just insult to injury.
  • Companies have found that gamers do not want distracting advertisements when they have already paid the retail price and/or a monthly subscription fee. Games which are paid, full-on AAA releases already make plenty of money from game sales and having ads which break immersion or are unskippable is not something which customers, for obvious reasons, are gonna be happy about. In NBA 2K20, there were ads during loading screens which are not only unskippable, but also longer than the game load timing. The game already has microtransactions, loot boxes, and cost $60 to get, but this was the last straw for a lot of customers. 2K Games got a lot of backlash for it, but they did the same with NBA 2K21. (Yikes.)

The Future of Ads in Games

We’re in a place where like it or not, ads are here to stay. We’ve looked at both the pros and cons, and at the end of the day, especially when it comes to mobile games, F2P is the monetisation method of choice. Game developers, publishers, and advertisers alike have to find the balance between making enough money and annoying their customers. Innovative ads which provide tangible value to customers is the solution to this. The good news is that players are receptive to ads in-games – in fact, 95% of players say that ads increase in-game realism

Ad platforms are already connecting publishers and advertisers within the metaverse to deliver in-game ads. Game developers can offer advertisers the possibility to show their ads within metaverse worlds on various fronts such as billboards in stadiums to posters in virtual worlds like Fortnite and Roblox.

Reward-based ads are some of the most successful ones: they have been shown to directly increase in-app purchases, increase screen-time, and improve engagement. In May 2017, after adding rewarded video ads that enabled users to gain an additional life, CookApps saw a 16% increase in session length in one of its apps. A/B testing found that session length shot up by 211% if reward ads were placed as soon as users exhausted their last life. In fact, when Rovio  decided to remove reward ads for users who had spent money in their game Angry Birds Transformers, these players were extremely annoyed as they’d come to rely on these ads as a supplement as opposed to an annoyance.

Another reason why advertising in games can be so difficult for game developers and publishers is because they don’t have data often as to what kind of ads their users prefer. This data is often kept secret by the advertiser they tie up with and they’re forced to put in what the advertiser says, sometimes at the cost of user satisfaction. However, if ads which are appealing to their audience based on their preferences are shown dynamically at a frequency that customers can handle based on player data, the irritation these ads cause can be reduced. 

Innovative ads are also often appreciated, especially if users get something exclusive. Fortnite is known for their concerts with prominent music artists like Travis Scott and Marshmello but recently, pop star Ariana Grande held a concert in the game across multiple days. While in previous concerts, you could dance in-game with your friends, fly around a giant character model of the artist, and enjoy cool visuals, this time around, you could play minigames where you raced and collected power ups, or fought in-game villains. Experiences like this which are utterly unique are sure to make users happy. With the metaverse booming and online experiences evolving, in-game ads are a great way to make money while also setting a standard and entertaining your users. Finally, sponsorships when done tastefully can be a great way to boost revenues while also advertising a company or product. For example, VALORANT’s international tournaments call rounds where you win by eliminating your opponents without losing your teammates a ‘Prime Gaming Flawless’ as they have a tie-up with Amazon. They also offer free-in game loot for those who have a Prime subscription. 

In-game advertising doesn’t have to be something done just for revenue at the cost of annoying your users, it can be done in a way that proves beneficial to all parties involved and that is what both game companies and advertisers should aim for. Data-backed dynamic advertising which either gives users in-game rewards or something else unique is the way to go.

How Gameopedia Can Help You

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How our data can benefit you:

  • You can create impactful display ads with high-quality artwork and videos.
  • Improve contextual advertising by targeting the right audience with the right ad at the right time.
  • Achieve true hyper-personalization by supercharging audience micro-segmentation.

Reach out to us for data that can empower you to new heights. 

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Monetisation In Video Games

Gaming is one of the most massive industries out there, with it being evaluated at $178 billion in 2021, and it is estimated that it will amount to $268.8 billion in 2025. Games aren’t just for entertainment, they are played for a variety of reasons such as competition, socialising with friends, and more. With games being so universally popular and a lot of popular ones like Candy Crush for mobile or Fortnite for PC/console/mobile being free, the question that arises is, why do companies keep investing in it? How do they make money from it and keep their industry thriving while also creating new content for their audience? The answer to that is game monetisation.

Game Monetisation at a Glance

Video game monetisation is a type of process that a video game publisher or developer can use to generate revenue from a video game product. The methods of monetisation may vary between games, especially when they come from different genres or platforms, but they all serve the same purpose: to return money to the game creators, copyright owners, and other stakeholders.

Initially, game monetisation was pretty simple: you’d pay a fixed fee to get hold of a physical copy of a game, or go drop a quarter in an arcade for one more turn. But with different kinds of games and gaming platforms popping up, there are several kinds of monetisation methods, each with their own set of pros and cons. 

A lot of games still can be bought with a one-time fee, such as the Assassin’s Creed series. These could either be physical discs or digital keys for the game. Some games require a subscription on a recurring basis to play such as World of Warcraft while others while being buy-to-acquire, are available to play for free through subscription services. A great example of the latter case is the Microsoft Game Pass for PC which not only gives you access to titles but also gives you discounts in the Xbox Store. The share of gamers who currently pay for a monthly gaming subscription worldwide is 35%. 

The annual net sum generated by Ubisoft through sales of digital items, seasonal passes, subscriptions, and advertising is €780m. You can also make money through additional content like DLCs and these can be purchased as add-ons to the original game. The annual net revenue generated by Activision Blizzard through microtransactions, DLCs, and subscriptions is $6.49 billion. Finally, a lot of games, especially mobile games, depend on advertisements in-game to generate revenue. These include games like Candy Crush Saga. Mobile games are well on their way to make $39.8 billion in ad revenue alone.

The History of Game Monetisation

Back in the 70s, the most common way to play a video game was to head down to your local game parlor and toss a coin into an arcade machine. Gaming consoles, PCs, and mobile phones weren’t quite in existence yet, and even when they did come into the picture, they were too expensive for most people to buy. Let’s look at the stats for one of the most popular arcade games of all time, Pac-Man.

Cabinets Sold: 400,000 units
Revenue by 1990: $3,500,000,000
Inflation-adjusted: $7,681,491,635

Eventually, in about a decade, computers and consoles became affordable and opened up the retail market. You could buy a game and take it home on a cartridge, floppy disk, and eventually CDs depending on your device. The release of Gameboys and Tamagotchis revolutionised the ability of consumers to game on the go.

The most successful arcade game ever, Pac-Man.

Up next came the shareware method where gamers would be able to play a portion of the game for free, and if they liked it, purchase the rest of it later. id Software used this for their famous releases Doom and Commander Keen. This possibly served as inspiration for games that have both a free and premium version where the latter has additional features/levels/content.

Later came DLCs or downloadable content which serve as an expansion or addition to the base game. One of the first ever DLCs was Grand Theft Auto: London 1969 for Grand Theft Auto and was a resounding success. Games like Total Annihilation in 1997 also offered a new unit every month as free downloadable content for the game on PC. In fact, more money is now spent on DLCs and subscriptions compared to buying video games themselves in the US according to data from 2021.

Grand Theft Auto: London 1969 for Grand Theft Auto was a huge success.

Of course, once mobile gaming came into existence, so did the Apple App store and the Android Playstore. Initially, most apps were paid for with a one-time fee but then the F2P methods and freemium versions also slowly gained popularity. You can read more about this and the history of mobile gaming in our comprehensive article.

As for PCs and consoles, online gaming expanded. Back in the late 90s and 2000s, F2P games came into existence with the revolutionary notion that a game could be completely free for everyone, that purchases didn’t give their players an advantage in the game. Games like Neopets, Runescape, and Maplestory gained popularity for these reasons, and even today in newer games, you can buy cosmetic items which make you look cooler than ‘default skin players’, such in the case of Fortnite, which generated $9 billion in revenue in its first two years.

A lot of skins in Fortnite are famous people or characters and make a lot of money in sales. Like $9 billion.

The concepts of subscription gaming, in-game items, then loot boxes also gained traction over the past two decades. The concept of in-game items was cemented with the release of ‘horse armor’ packs for Bethesda Softworks‘s The Elder Scrolls IV: Oblivion in 2006, and subsequently followed by many similar content packs over the next few years. Microtransactions and in-app purchases (IAPs) also became a considerable source of revenue in the upcoming years.

In-game advertisements also took off around the mid-2000s, particularly on mobile devices. It is estimated that in-game ad revenue might grow up to $56 billion by 2024. In the last several months, cloud streaming is slowly becoming bigger with more subscription services jumping into the space. You can read about the industry in detail here. 

Types of Monetisation

We looked at some types of monetisation which are commonly seen at the onset of this article but different sorts of games and platforms prefer various kinds of monetisation methods. For example, most mobile games use free-to-play  (F2P) models with inbuilt advertisements or in-app purchases (IAPs) for generating revenue. There are also mobile games that work on the freemium model where you get free but restricted access to the game before you need to buy the full premium version of the game to unlock the rest of it. The aforementioned model is pretty similar to the shareware approach we’ve covered.

Finally, there are games that are marketed as buy-to acquire but these have dropped significantly over the past decade. In fact, compared to most of the top 10 mobile games in, say 2008, which are accessible with a one-time fee, the top 10 from this year (so far anyway) is comprised of mostly F2P games with IAPs or adverts.

When it comes to mobile games, here are the key types of monetisation seen:

  • Buy-to-Acquire games: This is the simplest revenue model. You pay a one-time fee to download a game. An alternative way of doing this is releasing a free version with ads and a premium version with no ads and more content which you can buy with a one time payment. This is how Angry Birds did it on Android. You can also release the first chapter or part of the game for free and then charge for the rest of the game.

  • F2P with In-App-Purchases (IAPS) and Adverts: In this type of game monetisation, the game itself is free which lets the users try them out without having to buy it, increasing the game’s user base. Once in-game, players have the option to purchase in-game perks, abilities, upgrades, or items which help them progress further ahead in the game. A key example of this would be extra lives in Candy Crush Saga. They also have the choice to avoid this and continue playing the game normally. On average, only about 4% of players make a purchase within a game. The players who make these purchases often tend to repeat them and hence are the primary sources of income for the game. When it comes to ads, there are several ways for advertisements to appear in games apart from just the full-screen ads or the banners that appear on the screen headers and footers. Increasingly subtle approaches are being taken by brands such as the sports drink brand Gatorade. They gave players a digital boost through energy refills in EA’s Madden NFL Mobile, letting them play longer. Rewarded ads are currently the leading ad format on mobile. Instead of having an ad forced onto them, players choose to watch a video in exchange for a bonus. Most of these games come with both IAPs and advertisements. 

  • Subscription models: Games may also have subscriptions that grant the player more items and even on occasion, an edge over normal players, such as VIP Access in games like March of Empires. Games with this form of monetization usually track live data and are updated based on it. 

When it comes to console games though, it seems as though the majority preference is still buy-to-acquire games, though subscription services like the Xbox Game Pass are still popular. Within consoles, there is an internal war as to which console sells better. This used to be between the Xbox and the Playstation, though in the past two years, it’s the Nintendo Switch which has sold the most. This could be a result of the several Nintendo exclusives like Animal Crossing: New Horizons and Super Mario Odyssey. Between the Xbox and Playstation though, it is still the Playstation coming out on top. A large portion of this success can be attributed yet again to the exclusive games available on the Playstation platform such as The Last of Us or the Uncharted series. When most people would only want to own one console, these exclusives represent another tangible benefit for investing in one particular console. However, exclusives are slowly fading away, and you can read more about that in this blog.

Exclusives like Animal Crossing: New Horizons, have made the Nintendo Switch the best-selling console.

Looking at console subscription services, Microsoft and Nintendo are doing a phenomenal job of making these appealing to their audience. The former offers Game Pass, which is a monthly subscription providing all-inclusive access to Xbox games and new games. Customers get access to more than a hundred Xbox games—including previous generation games that played on Xbox, Xbox 360, Xbox One, and Xbox Series X. Game Pass subscriptions are also available for use on PCs and mobile devices that support cloud play so that you can play compatible games available through the Game Pass on other devices. This last point in particular has hugely popularised the Game Pass and even people without an Xbox often buy it so they can play on other devices, usually the PC.

The Nintendo Switch Online subscription service provides access to more than 100 games from Nintendo and Super Nintendo, including the classics Super Mario Brothers and Donkey Kong Country. The company also offers an expansion pack with more enhanced services, including cloud saving and online multiplayer. Last month, Sony released their answer to Game Pass called Playstation Plus Extra and Premium. They follow the same model as Game Pass and provide a large library of both current generation games and older games from the PS2 and PS3 as well. One major issue in Nintendo games which the Online subscription is partially remedying is how the same game needs to be bought separately on each different generation of Nintendo devices.

When it comes to PC games, buy-to-acquire games and in-game transactions are the forerunners for preferred methods of monetisation, followed by subscription services for either games like Humble Bundles or cloud gaming subscriptions like Nvidia’s GeForce Now and Google’s Stadia. Lots of players still like buying physical or digital copies of a game. When it comes to online games, especially free ones, in-game advertising similar to mobile games plays a role. Finally, a recent kind of monetisation called play-to-earn, where both the players and the game publishers profit, is gaining traction with the rise of the Metaverse and games like Axie Infinity. Axie Infinity has made over $4 billion in NFT sales since its launch. It also shows that there have been 14.45 million transactions and 1.62 million buyers since its inception. 

Axie Infinity has made over $4 billion in NFT sales since its launch and is a shining example of the play-to-earn monetisation model.

Apart from our breakdown across devices, here is a comprehensive list of game monetisation methods employed by game makers before and after a player has acquired the game.

1. Pre-Acquisition:

These are monetisation methods usually employed before you purchase a game or a subscription to it.

  • Pay-per-Play
    Like the name suggests, you pay per game. This originated during the time of arcade machines where one game cost a quarter or two to play, and apart from online games like Poker or Rummy where you have to buy-in per game, it is not that popular these days.

  • Buy-to-Play
    Like premium games, the consumer buys the game once to play, but here, the game generally continues to be supported by the developer or publisher by maintaining online servers or producing new content regularly for the title. Examples of games like this include GaaS titles such as Rainbow Six Siege and Minecraft.

  • Free-to-Play
    Free-to-play games do not require the player to purchase the title to play, though access to some features and content may require purchase of a subscription or via microtransactions. An example of this would be Angry Birds, which after being a paid app on the Apple App Store, shifted to a freemium model where to unlock extra levels and play unhindered by ads, you needed to make a one-time payment. There are subtypes here as well, which you can see below:

    – Truly Free: The game is free and you don’t need to buy anything to complete playing it or to win. Games like Pixel Dungeon which have no ads or strings attached come under this category. These are not made for monetisation purposes, they are created and put out into the world by developers who want to express their artistic vision.
    – Freemium/SharewareGames that have a demo version or come with restricted content come under these categories. For freemium games, the aforementioned Angry Birds is a great example. Shareware is another, rather dated method of game monetisation where the games are free to play to start, but limit how far the player can progress before they must purchase the game. You could play the first part of a game, and if you liked it, you could buy the rest of it. Games like id Software’s Commander Keen or Doom were sold and marketed in this way.
    – Free to play games with IAPs: These are games which are free to download and play, but come with in-app purchases (IAPs) such as in-game skins (Fortnite), extra lives and hints (Candy Crush Saga), and the like. These are popular because such games thrive on a small minority of big spenders. According to App Annie, games now compose 56% of all App Store spending, with 95% of this on IAPs.

  • Subscription model (Pay-to-play):
    These are games that require the player to pay a regular subscription fee to maintain access to all parts of a game. The game is typically free-to-play to allow new users to try the game but full access requires the subscription to be paid. A good example of this is DestinyOther examples of this include games like World of Warcraft, which is free to play up to level 20, after which you need to buy a subscription. 
A great example of a game that uses the subsciption model is World of Warcraft, which is free to play up to level 20, after which you need to buy a subscription.

These can be further split into the following:

  1. Subscription Model
    For these kinds of games, you need to pay a monthly or annual subscription fee usually to be able to access the entire game with all its features. You might also have in-game transactions but a majority of the revenue for these kinds of games comes from the subscription fee. 
  2. Subscription Services
    These are services through which a gamer can gain access to a multitude of games for a fixed monthly price. The player may need to buy access to new content at times, such as through a season pass. This includes both offline stores as well as digital distribution methods. The best example of these is the Xbox Game Pass or Apple Arcade.

Games can be bought either through retail outlets offline or through digital distribution methods. The former are growing less popular with digital distribution being instantaneous, less onerous since you don’t have to find a place that stocks a game before heading there to buy it, and cheaper since digital copies of games are often cheaper, though not always, compared to physical ones.

2. Post-Acquisition:

  • Downloadable Content (DLC)
    These include additional pieces of story, new areas, and weapons added to the game, new characters, and the like. These can be purchased with an ultimate edition of the game or bought separately if released after the main game. Examples of great DLCs include Blood and Wine for Witcher 3: Wild Hunt or the Citadel DLC for Mass Effect 3.
One of the best DLCs released, Mass Effect's Citadel expansion.
  • Season Passes

    A season pass is a form of DLC Compilation in which consumers purchase a package for current and future downloadable content (DLC) packs for a video game (that is generally cheaper than the base price of purchasing DLCs individually). A game may have a single season pass or, for some GaaS games, new season passes over time. Examples include Assassin’s Creed Valhalla’s Season Pass and Super Smash Bros. Ultimate: Fighters Pass Vol. 2.

If you purchase the VIP subscription for Forza Horizon 5, you will receive 3 Exclusive Forza Edition cars, Vanity Items, 2x Credit race rewards, weekly bonus Super Wheelspins, and loads more.
  • Microtransactions or IAPs

    We briefly spoke about how IAPs can be found in F2P games and act as their monetisation method but these can also be present in paid games. In fact, Star Wars Battlefront 2 had to remove game-play affecting microtransactions which made the game pay-to-win. Players no longer had to pay to unlock characters though microtransactions for in-game cosmetics still stayed.. However, microtransactions when they don’t mess up gameplay by giving unfair advantages or offer enough value for money still exist and work for gamers and publishers alike.

  1. In-game items:
    – Cosmetic Only: These include cosmetics like character and gun skins, house decorations, and the like which don’t provide any benefit to the gamer apart from eye candy.
    – Gameplay Affecting: These can be of two kinds, one where by sinking money into the game, one can quickly climb to the top of the leaderboards. The other is by purchasing things like hints or extra lives so that you can solve the game when you’re stuck as opposed to propelling you forward. If gameplay-affecting IAPs are excessive, the game becomes unplayable for free players and the user base of the game will greatly decrease.

  2. Loot boxes:
    A loot box is a consumable virtual item which can be redeemed to receive a randomised selection of further virtual items, or loot, ranging from simple customization options for a player’s avatar or character, to game-changing equipment such as weapons and armor. A loot box is typically a form of monetisation, with players either buying the boxes directly or receiving the boxes during play and later buying “keys” with which to redeem them. These can be seen in games like Rocket League (which removed them two years ago) and Genshin Impact (there till date.)
    Some loot-box systems within free games are criticised as “pay-to-win” systems. In these cases, the contents of the loot box contain items, beyond superficial customization options, which directly affect gameplay, such as booster packs for a digital collectible card game. An example of this is Hearthstone, where players have to keep spending money to get new cards. Full-priced games which already provide downloadable content and then include a loot-box system have been heavily criticised by players. One of the games which drew a lot of flak for this was the aforementioned Star Wars Battlefront 2. The outcry against loot boxes has reached the ears of international lawmakers and they’ve already created legislation which has pushed some countries to roll out bans, like Belgium.

  3. VIP Subscriptions:
    These are a kind of special subscription, usually on top of purchasing a game or subscribing to it which offers exclusive rewards that give your game a boost and make you stand out. For example, if you purchase the VIP subscription for Forza Horizon 5, you will receive 3 Exclusive Forza Edition cars, Vanity Items, 2x Credit race rewards, weekly bonus Super Wheelspins, and loads more.

  4. Battle Passes:
    Again, you can buy these in game, usually F2P games. They encourage players to play the game on a periodic basis to complete it while also providing them with in-game items and cosmetics they can use. Games like Fortnite and Valorant have these.
  • Advertisements:

    When it comes to in-game advertisements, they can be of two major kinds:
    – Interstitial ads
    These are ads which are initiated by the game and cannot be avoided by the player usually. These include popups which players have to watch for a few seconds before closing or ads that appear along the foot or side of the game while playing. These are usually simpler to make while also more annoying to the player, unless they’re interactive or creative. Gameloft worked with Indian online retailer Myntra for a playable ad campaign that received an impressive 82% completion rate and 2.1 million impressions in just under two months.
    – Reward ads
    These are ads which are initiated by players, usually for additional resources like more in-game currency, extra lives, or faster cooldowns. These are usually more accepted by players since they have a choice as to whether they want to watch them while also being rewarded if they do.

  • Play-to-earn Games:

    These are games that typically incorporate blockchain elements such as NFTs. Players are incentivized to use NFTs to improve their existing portfolio or create new NFTs, with their sale managed by the video game publisher or developer. The player then is paid by the company for their work towards the new and/or upgraded NFT. Games like Axie Infinity have even proven to be a source of revenue for some players but these games are also rather susceptible to scams.

There is usually an upfront payment required by the player to get started, typically in the purchase of either cryptocurrency used by the game or in-game currency that they can later trade out, thus making these games “pay-to-earn”, and have been considered the equivalent of Ponzi schemes.

The Impact of Monetisation

At the end of the day, the video game sector is also an industry expected to continue generating the incredible revenue which it does. This means that in order to get gamers to spend more time and money on their games, publishers and developers alike will need to innovate and hold themself to a certain standard. In fact, with developers investing more time in games post their launch to ensure they remain fresh, players often end up getting more value for their money. A great example of this is the original Destiny. Games which were initially pay-to-acquire have also been made free and have switched to an IAP-driven revenue model. The Epic Games store in particular is driving this transition with their acquisition and subsequent free giveaways of games like Rocket League, Among Us, and Fall Guys.

The Epic Games store has been doing free giveaways of games like Rocket League, Among Us, and Fall Guys to build up a user base to compete with Steam.

However, monetisation of games can also come with negative impact for games. Since the method of monetisation must be decided before the game production, it may affect the game’s overall design and will shape how new games are designed. This might mean that games might be made in genres that are easier to monetise. Copies of successful games flooding markets can also lead to a lack of originality. For example, the F2P game Wordle has a plethora of similar games, some good and some bad. The rush to make the most money from one’s game can also lead to an improper consideration of balance between good game design and effective monetisation. This in turn can cause either players feeling extorted by the game and its developers or a failure of the game to produce enough revenue for the game to turn a profit. 

Finally, with games shifting towards a digital world, the question of ownership comes into play. Ubisoft recently said Assassin’s Creed Liberation from Steam would be removed and players who had bought it through that portal couldn’t access it even though they, according to Steam, owned the game. This was eventually rolled back and the game was made available again after global outrage. This is however a reminder that licensing issues can arise anytime and if they strike owners of digital copies, well, odds are that they won’t be able to play the game again. Also, with servers going down for decrepit games, they can become unplayable as well.

To conclude, in our previous blogs about the game industry, we look into the motivations of players and how the decisions they make regarding platform players, investment in the metaverse, and futuristic tech like VR and cloud gaming. All of these usually incorporate monetisation in some form or the other. When it comes to monetisation, it seems like the most successful and thriving model by far is the F2P one. Being able to play a great game for free is more likely to encourage a player to buy a battle pass or invest into cosmetics for the game. A great example of this phenomenon are CS:GO and Valorant skins. 

One of the best kinds of monetisation methods which benefit both consumers and industry players are advertisements, particularly customer-initiated reward ads. Another method would be subscription libraries where customers get a lot of content and games for a fixed price while publishers can resell older content along with the new. Everyone profits. Whether you want to play a game from the good ol’ days or jump into the latest hit, subscriptions like Nvidia GeForce Now and Xbox Game Pass have you covered across several platforms. 

Monetisation has evolved a lot over the years. If you’re looking for custom data about a particular kind of monetisation or the games that fall under the category, we have you covered.

Gameopedia works with clients across the industry on custom requests and can provide in-depth data about metaverse-related games. Reach out to us for data that can empower you to new heights. 

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A Guide to Everything Metaverse and Gaming

In the past year, one of the most searched for (and least understood) phrases on the internet was ‘metaverse’. This was a result of Facebook – after 17 years of operating under the name – rebranded itself to Meta because Mark Zuckerberg believes the metaverse is the future. Meta has also announced an investment of $10 billion in 2022 and more over the coming years to develop metaverse technologies. In fact, the metaverse is estimated to become an $800 billion market by 2024. The question that comes to mind is, what’s all the hype about?

In this article, we will attempt to understand what the metaverse exactly is, the technologies that play a major role in it, and its future.

What is the Metaverse?

The word “metaverse” came into existence in the 1992 science fiction novel Snow Crash by Neal Stephenson as a combination of “meta” and “universe.” It was Stephenson’s early 1990s vision of how a virtual reality–based internet might evolve and resembled a massively multiplayer online game (MMO) where people controlled virtual avatars. In modern parlance, the metaverse is a network of three-dimensional virtual worlds focused on social connection. It seamlessly blends games, virtual reality, live-streaming, cryptocurrencies, and social media. The gaming world seems to have already adopted the metaverse’s most basic form. We’ll dive into metaverse games a bit later.

The metaverse, as envisioned by Neal Stephenson in Snow Crash.

The metaverse is a word that is often used in conjunction with Web3 or 3.0 which aims to decentralise the internet. Web3 technology is supposed to give their users the following guarantees:

  • Unified identity authentication system
  • Decentralized operation network
  • Data confirmation and authorization
  • Privacy protection and censorship resistance

For this to be possible, there has to be technology that has decentralized storage, immutability, and information encryption. 

Technologies That Play a Part in the Metaverse

There’s a lot that you need to create a fully-fledged three-dimensional virtual reality and in the past decade or two, technology has developed a great deal. We can break down the requirements into hardware and software needs. The former includes powerful computers and mobile devices, augmented reality (AR), virtual reality (VR), and their associated peripherals. We have a series of articles where we talk about VR and its evolution in detail if you want to learn more. When it comes to software, there has been no wide-scale adoption of a standardized technical specification for metaverse implementations, and existing implementations rely primarily on proprietary technology. At this juncture, you have multiple platforms that offer experiences in VR and AR which are like the different apps you can download from the App Store. However, there isn’t a single portal that people can use to access the metaverse.

The Role of NFTs and Blockchain Technology

Two terms you would have heard often in conjunction with the metaverse are NFTs and Blockchain. We’ve covered the basic definition of these in our 2022 Gaming Trends article, but to recap, a blockchain is essentially a chain of data blocks on a computer network that is transparent to all of its users as well as anybody else. It cannot be altered or relocated. This way, a complete record of everything that has transpired on the network in relation to the data is preserved. Blockchain gaming is a means of turning digital assets inside video games (such as collectibles or cosmetic skins) into real-world assets in the form of NFTs or non-fungible tokens. 

The metaverse is a virtual universe with a lot of possibilities: you could buy a virtual house, get designer clothes, or attend a concert. One of the main features of the metaverse is that it has a full-fledged economy within it and bestrides the boundaries of both the real and the virtual world, so it needs to be decentralised. This means no one person or organisation should own it or control it. Ideally, it should be a distributed peer-to-peer network that uses blockchain technology (because of its aforementioned transparency) to maintain consensus. In the metaverse, creators need to be able to assign value to their digital assets and NFTs are a way of doing so. NFTs will be in charge of pricing their content with proof of ownership.

NFTs are created when a digital file (commonly an image, video, or GIF) is minted. Minting means that a certificate of ownership and originality is generated via cryptocurrency (usually Ethereum) and sold or granted to the new owner. They are also often combined with tangible benefits in the real world, such as Chevrolet auctioning an NFT of a Corvette where the winner of the auction also gets the uniquely colored car in real life (the auction didn’t get any bids, so the benefits can be dubious.) Owning an NFT can also give you access to certain private communities, though the jury is still out on whether it’s worth spending hundreds of thousands of dollars on virtual images of a monkey in a suit, even if celebrities don’t seem to mind.

The Chevrolet NFT of the unique Corvette (which had no takers.)

It is important to note that while the words NFTs, blockchain, and metaverse are all often thrown around together, only a handful of companies have already built real solutions in this field that implement NFTs. It is perfectly viable to be a part of the metaverse without using these technologies, and that’s what some of the most popular games do, such as Fortnite. Let’s look at gaming in the metaverse, because it is one of the most popular areas of interest in it.

Games in the Metaverse

Players can invite their social media friends, interact with other players inside the Metaverse, and collaborate to enjoy games together. Metaverse games are also often based on the play-to-earn concept that allows players to win virtual in-game items and sell them to earn real-world money. However, not all metaverse games are NFT-based or play-to-earn.

When it comes to the envisioned future of the internet, the simulation game Second Life is pretty close. You can sleep, eat, shop, and basically enjoy an existence similar to what you would have in real life. Your avatars in the game are how you virtually represent yourself. This was released way back in 2004 and has evolved since then but the concept is the same. In 2006, Roblox was released. Here, you can play games other people have created and spend time in their worlds. It gained massive popularity during the pandemic and was the third highest grossing game in 2020. Recently, a collaboration between Roblox and Gucci created a virtual Gucci Garden space that sold limited edition virtual bags. One of the digital bags even sold for $800 more than the actual version.

In 2015, Decentraland, the first platform to allocate virtual pieces of land via a proof-of-work algorithm, was launched and since then, some of these plots of land have sold for several hundreds of thousands of dollars. You can also find and participate in events like art exhibitions, parties, and the like. Something similar is the Sandbox, the third-largest metaverse based on the Ethereum blockchain. It allows users to create, share, and monetize their assets (like real estate) and gaming experiences.

In 2017, Fortnite released and quickly became a cultural phenomenon. Travis Scott, a famous rapper, hosted a virtual concert in 2020 that was attended by over 12 million people. There are in-game character skins created in collaboration with several famous franchises like Star Wars, Naruto, Marvel, DC Comics, and more. 

Some Fortnite skin collaborations with Marvel, Stranger Things, Star Wars, DC Comics, Borderlands, and even musicians like Marshmello.

Play-to-earn games have started becoming a phenomenon. In 2017, a game called CryptoBots went public, which was the first play-to-earn NFT game. In 2018, Axie Infinity, a play-to-earn NFT blockchain game, was built on the Ethereum network. During the game, players breed mythical animals and trade them. Your creatures can battle other animals to earn Smooth Love Potion tokens, which can be traded for real money through a cryptocurrency exchange. Axie Infinity has made over $4 billion in NFT sales since its launch. It also shows that there have been 14.45 million transactions and 1.62 million buyers since its inception. However, it has also proven to be vulnerable to hackers, who stole approximately $620 million worth of cryptocurrency from a network used to process in-game transactions. While Axie representatives have stepped up and said that they’re committed to reimbursing players for their losses, the risk remains.

Axie Infinity, one of the most notable play-to-earn games.

In 2019, Facebook (now Meta) launched a social VR world called Facebook Horizon, now called Horizon Worlds. With the success of AR thanks to Pokémon Go, Swedish lifestyle and furniture behemoth IKEA jumped in on the bandwagon with their innovative Place app, which lets you choose a piece of furniture and see how it looks in your home or office. In 2020, Alien Worlds was released. It involved a multi-metaverse interplanetary scenario that had NFT characters interacting in a decentralized autonomous organization to mine tokens and perform tasks. By 2021, Alien Worlds had more than 2.5 million users

We can see that games in the metaverse fall into one of the below categories, and are often a mix of multiple categories. 

  • Social Gaming: These are games in the metaverse where you can meet your friends from real life or make new ones with similar interests. You can even hang out with strangers and meet new folks. One of the first social games was Horizon Worlds by Meta but usually, successful social games are combined with other categories so they’re more fun. Notable examples include Fortnite and Decentraland.
  • Games-as-Platforms: Games aren’t just limited to playing Tetris or whatever, they’ve become a whole new lifestyle. You can spend time in them building your own house or games, play other peoples’ creations, and enjoy a diverse, virtual life. Roblox and its many worlds are a great example of games as a platform.
  • Mixed Reality Experience: When we talk about mixed reality, we mean not just pure VR games but also augmented reality and any kind of mix between the virtual and the real.  Games like Beat Saber (VR) and Pokémon Go (AR) are testaments to how merging the worlds can end up into incredibly fun experiences.
  • Play-To-Earn: From a zero-value market size, the blockchain gaming industry grew to $3 billion in 2021 and is projected to rise to $39.7 billion by 2025. Fueled significantly by the play-to-earn model, the blockchain gaming industry has attracted over 1.5 million diverse gamers across the globe. Games such as Axie Infinity have generated several millions in revenue and are used by a multitude of people as a source of revenue.
  • Portable Game Assets: This is technically not a game category but is a huge feature that the metaverse would like to ideally have. Being able to buy cool things in a game and reap their benefits in game has been a thing ever since skins for characters and weapons became popular. In the metaverse though, one of the biggest promises is that of portable game assets, where for example, if you own a car in one metaverse, you should be able to take it to the next. There are no universal portable game assets (yet) but in games like Roblox with a huge number of worlds, you can take your virtual belongings around between them.

Gaming in the metaverse is full of potential with a focus on new ways to play, earn, work, and do a lot more.

The Costs and Processes of Populating the Metaverse

However, all this isn’t easy. Currently, it feels like every mention of the metaverse comes with a price. NFTs are either exorbitantly expensive or the fees associated with them are, blockchain games require expensive buy-ins before one can try the gameplay, and owning digital land within a metaverse platform can rival one’s real life rent. Equipment costs can also be high if you want to buy VR gear or more powerful devices to experience the metaverse. While brands and tech companies want consumers to embrace this evolution of the internet experience, it seems increasingly inaccessible to a large portion of the internet’s denizens.

A lack of capital is a hindrance in the metaverse. A writer loaded up Decentraland to try playing a little poker to see how well it worked. In the poker area, they were informed they needed to buy an item of clothing, which acts like a membership card to play. The price for the cheapest item, a pair of glasses, was 1.948 ETH, around $5,588.19 then. Compare this to informal poker buy-ins in real life. According to Fortune, the metaverse platforms Sandbox and Decentraland are selling the smallest chunks of land for 3.7 and 3.46 eth respectively, which was around $14,099 and $13,211 at the time.

A lot of people turn to the internet as a place of affordable entertainment. The metaverse so far though seems to cause more roadblocks to this sentiment than aid it.

The Positives of the Metaverse

It isn’t all doom and gloom though. The metaverse, even in its current avatar, brings a host of benefits to the table. These include:

  • Better social connections irrespective of physical proximity:
    You can stay in touch with your friends and find new people who have the same interests as you relatively easily. Gaming worlds like Roblox excel at this as you can find a game within it you and your friends like and hang out in that world with them, just like going to a park together.
  • Immersiveness:
    You can enjoy games and experiences online with additional dimensions, with new haptic suits and gloves even simulating physical interactions. The critically acclaimed Half-Life Alyx takes interactions in VR to a new level: you have to physically duck for cover or reload a gun by taking the magazine out and reinserting it.
Playing Half-Life Alyx is a highly interactive experience.
  • New business opportunities:
    Whether it’s NFTs being sold, virtual brand deals and concerts, or even digital real estate, the metaverse is a great place to try and make money. The risk might be high but the rewards can be astronomical. Games like Axie Infinity have proven to be ways for players to supplement their income or even play the game for a living and places like the Philippines account for 35 percent of Axie Infinity traffic and the biggest share of its 2.5 million daily active users.
  • Games have drastically improved:
    With VR being increasingly realistic and affordable, far more VR games have been released and companies like Epic are betting on gaming and the metaverse. They put in $1 billion into metaverse gaming in early 2021. These investments into the gaming industry are sure to bear fruit, either in the form of new and innovative games, or other supporting technology such as VR. Meta is certainly focusing significantly on the latter.
  • Online education and work:
    One thing during Covid was how several schools and universities around the world switched to platforms like Zoom to ensure their students would be able to continue learning. Further, imagine learning with the help of immersion. If you want to teach geography, wouldn’t a virtual tour of the world be better than just staring at an atlas? Gamification of academics is a great way to encourage learning and metaverse gaming is a great way to do that. Companies are also looking more favorably on remote work and the virtual office is looking increasingly likely.

Challenges the Metaverse Faces

There are a lot of problems to solve before the metaverse can really thrive though. While we’ve looked at the benefits, the drawbacks should also be considered.

  • Social issues:
    While the metaverse might not be affected by physical distances, it can definitely lead to a loss of connection with the real world. Internet addiction disorder, social media, and video game addiction can have mental and physical repercussions over a prolonged period of time, such as depression, anxiety, and an increased risk for obesity and cardiovascular disease thanks to a sedentary lifestyle.
  • Cybercrime:
    Existing online platforms and games are vulnerable to all sorts of illegal activities, such as fraud, money laundering, child exploitation, illegal goods, services trafficking, and cyberattacks. The metaverse is no different, with several large-scale scams already proving to be an issue. The lack of moderation and proper guidelines and comprehensive laws can lead to major criminal activity. User safety is also a concern, as there is no easy way to verify age, gender, and the like without possible privacy violations.
  • Personal Data Security:
    Users will probably have their information collected on an even greater scale now as a result of interactions in the metaverse as well as possible biometric data through VR and AR devices. Companies like Meta also plan on having targeted adverts within their metaverse, which might lead to more exploitation and manipulation of individuals.
  • Feasibility and accessibility:
    A true metaverse as portrayed in fiction such as Ready Player One and Snow Crash might not be feasible with today’s technology – both in terms of hardware and software. Furthermore, the technology currently available often is extremely expensive. Virtual spaces might also have too high an entry cost for a lot of people and this might prove to be prohibitive.
  • Lack of Interoperability.
    Currently, it’s nigh on impossible to take virtual items like cars or real estate from one metaverse to another. Legal and commercial challenges are also a major issue, with no real adjudicator available on the scene yet.

Current Investments in the Gaming Metaverse

Like we mentioned at the onset of this article, the metaverse is estimated to become an $800 billion market by 2024. That’s up from almost $500 billion in 2020

In October 2021, Tencent established the F1 studio under the subsidiary TiMi Studio Group for focusing on metaverse development. Meta has also announced investment of billions of dollars over the coming years to develop metaverse technologies. The tech giant has also invested up to $10 billion in acquiring VR technology and has plans to invest in AR technology to build out their virtual world capabilities. With their plans expected to take up to 15 years, they’re in this for the long haul. Google has also discussed the possibility of mapping the Metaverse and implementing current services such as YouTube into virtual worlds. They have also invested a hefty $39.5 million into a fund that invests directly into Metaverse projects. 

In June 2021, Epic Games said that it has secured $2 billion in its latest round of investments in its quest to create the metaverse, a realm of interconnected virtual worlds like those depicted in novels like Snow Crash and Ready Player One. Disney is developing a metaverse theme park. Nike has a virtual store within the Roblox Metaverse called Nikeland, which has attracted over 7 million people from over 200 countries. They’re currently selling their Nike branded virtual sneakers for over $100,000.

Nike sold a pair of virtual sneakers for $186,000 in the metaverse. Source: Ladbible.

Even dating apps like Tinder are getting in on the action, with their new concept on a few college campuses in South Korea that allows users to meet in an area called Singletown and interact as avatars using real-time audio. The company is also rolling out its own coins — Tinder Coins — which are currently being tested in several markets, including a few markets in Europe.

What the Future of the Metaverse Looks Like

If the metaverse can be decentralised, safe, and accessible, it is possible that it will be as commonplace as the internet is today. AR, VR, and other technologies are propelling the metaverse forward and evolving along with it. Future technologies and players that will enhance metaverse capabilities have yet to emerge. The power and reach of the metaverse can potentially eliminate many of the constraints and biases of today’s reality. 

The future of the metaverse is uncertain, but only as to how exactly it will look. With major investments being pumped into it by global titans such as Google and Meta, it is likely that the combination of digital worlds, virtual assets, and how they shape our social experiences and affect our economy will be of extreme significance. Gaming in the metaverse in particular is breaking barriers with increasing speed and soon, we might be able to play games in the metaverse and enjoy them like a real-life experience.

Gameopedia works with clients across the industry on custom requests and can provide in-depth data about metaverse-related games. Reach out to us for data that can empower you to new heights. 

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The History, Evolution, and Future of Mobile Gaming

In our previous articles, we’ve established that the gaming industry is steadily, if not exponentially growing. A key reason for this massive boom is mobile gaming. The global market for mobile gaming is estimated to be $94.8 billion for the year 2022 (all the way up from $52.7 billion in 2018) and is projected to reach a revised size of $139.5 billion by 2026, growing at a CAGR of 12.3%. Even in the past few years, mobile games have made up the most significant chunk of revenue when compared to other segments like PCs or even consoles. However, the question arises as to why mobile games have such a huge market and growth rate. One might simply attribute it to mobile devices being an integral part of everyone’s life as people have mobile devices no matter what but that’s just the tip of the iceberg. In this article, we’re going to take a deeper look into the mobile gaming industry and break down its astounding success.

Analysis of the growth of the mobile gaming market globally over the past 5 years. Courtesy: Global Industry Analysts Inc

The History of Mobile Gaming

The first ever game released for a mobile phone was Tetris for the Hagenuk MT-2000. However, mobile games didn’t really gain traction until Snake released in 1997 for the Nokia 6610. It’s still a game which gets a great deal of love. 

Snake was one of the most profilic games ever released for the mobile.

Technology did evolve, and with it, so did games. The Wireless Application Protocol (WAP) is a technology standard developed to enable mobile devices to connect to the internet. While it didn’t really help people to browse the net or play complex games, relatively simple multiplayer board games like tic-tac-toe or Connect 4 were viable and fun. In the 2000s, Alien Fish Exchange was one of the games that caught fire. It was simple to get into: you have an alien fish you can breed. However, with WAP technology, you could trade and sell fish to other players or worst case, the in-game restaurants (ouch!). In 2001 though, mobile gaming had a seminal moment – the extremely popular Arcade game, Space Invaders, was released for mobile phones. Even though it was monochrome, the fun remained the same. Two years down the line, colour mobile phones started becoming widespread. With the improvements in technology, big-time publishers like EA started investing in mobile games. One of the biggest titles to come out in 2004 was Asphalt GT from Gameloft. More racing games were released that year and became one of the biggest genres for mobile gaming.

One of the biggest titles to come out in 2004 was Asphalt GT from Gameloft, causing the release of more racing games that year.

The next revolution for mobile gaming came in 2007, when Apple released its touchscreen iPhone. With the launch of its AppStore in 2008, there was a platform available for developers to sell their games to their customers without mobile operators or publishers getting a cut. Beyond games, the iPhone and App Store caused most other smartphone manufacturers to abandon their own attempts to build out a more sophisticated smartphone environment, such as BlackBerry and Symbian. BlackBerry had attempted to release its own app store but failed to gain the same success as Apple’s. Only two major competitors remained after the iPhone’s introduction, the Android-based devices (based on the Java language), using the operating system that had been developed by Google, and Windows Phone by Microsoft. Both took up the same approach as Apple, introducing app stores in Google Play and the Windows Phone Store. Ultimately, Microsoft ceased active development of Windows Phone, leaving iOS and Android as the principal players in the mobile operating system and app store market.

In December 2009, Rovio Entertainment released Angry Birds on the App Store, a physics-based game involving launching cartoonish birds at structures occupied by pigs that have stolen their eggs. The game was cheap, addictive, and extremely fun, and when Rovio ported the game over to Android, they released a free version with ads, though users could pay to remove those. Thus, they monetised their game on multiple fronts. 

Angry Birds was a huge hit, especially because of its free version..

The rise of social networks like Facebook saw games like Farmville gaining popularity, with more than 80 million players by February 2010. Up next came King’s release of Candy Crush Saga in October 2012. Both games still integrated with Facebook to ask their friends for extra lives, but the latter also let you purchase extra lives and power-ups in game. By the end of 2013, King had seen over 400 million new players of the game and their revenues had jumped from $62 million in 2011 to $1.88 billion from advertising revenue and in-app purchases.

The next kind of game which gained a huge audience was Clash of Clans. It retained similar in-app purchases as with Candy Crush Saga but also weighed heavily on social engagement similar to MMOs. By September 2014, the app was earning $5.15 million per day, and many users had reported playing the game for thousands of hours since its launch, attributing it to the multiplayer aspect of the game. Hyper-casual games like Flappy Bird and Crossy Road were also popular during this time. 

In 2016 though, a new technology came to mobile phones and changed gaming yet again: AR. Games like Temple Run and Subway Surfers used the rudiments of the technology to add an additional dimension to their game. Niantic then released Ingress, a science-fiction game that uses a mobile device’s GPS to locate and interact with “portals” which are in proximity to the player’s real-world location. The portals often manifest as public art such as statues and monuments, unique architecture, outdoor murals, historic buildings, local community hubs and other displays of human achievement. 

However, Pokémon Go was where AR and its geo-location concept really struck gold as Niantic expanded on what Ingress had taught them. The meteoric success that Pokémon Go found is hard to describe. All of a sudden, everyone around you could be spotted with their phone in hand, furiously swiping to catch a Lapras or Dratini in front of them, though only visible on their device. Odds were, you were too busy trying to catch them all yourself to notice what other people were doing (unless of course they were trying to take over your virtual gym.) Pokémon Go had record-breaking numbers of players, with both its initial iOS and Android releases seeing over 100 million players worldwide within a month of release.

Pokémon Go had record-breaking numbers of players, with both its initial iOS and Android releases seeing over 100 million players worldwide within a month of release.

In the last few years, cross-platform play has become a major watch-word for mobile games. When Fortnite launched, it was initially released for consoles and the PC but soon spread across several platforms including mobile devices. As a result of this, a large number of their players were in fact children playing on phones. Games like Genshin Impact also saw a lot of love. Finally, as the pandemic came in, multiplayer mobile games like Among Us had a huge increase in audience numbers as a locked up population turned to gaming as a way to stay in touch with their friends and socialise.

The timeline for major milestones in the mobile gaming industry.

Why are Mobile Games so Popular?

Smartphones are a device almost everyone has, irrespective of age and station. Whether it’s your granddad or your five year old sibling, they can find and download games and immediately start playing, no matter where they are. According to AppAnnie, players downloaded 82.98 billion mobile games in 2021 and 64 percent of people who play mobile games do so on a daily basis. In 2020, gaming apps were also the app categories reporting the longest session lengths per user

Mobile games are easily accessible to all, extremely convenient to download and play as opposed to setting up a PC or console and their peripherals, and the best part is, you can enjoy them anywhere, anytime. You can download your favourite game from app stores and play it when you are waiting for a taxi or your restaurant order. When it comes to developers and publishers, it is cheaper to make a mobile game and since most mobile games released employ a F2P business model, the barriers to entry are negligible. These days, mobile games are also known for their creativity and console-quality titles. There are already joysticks and controllers specially tailored for mobile phones and in the future, we could very well see titles available for the pc or console playable on mobile.

Of course, once mobile games were proved to be something the public loved, companies had to figure out a way to make money from them without annoying their audience (too much.)

The Evolution of Monetisation in Mobile Games

Before the launch of the App Store in 2008, many mobile phones were able to access limited browser-based games with WAP, and later download new apps that could be purchased from their wireless carrier or a distributor to use on their phone. However, the access to this rudimentary form of internet was extremely limited and game discoverability was hampered by this. Furthermore, there was a wide discrepancies of technologies available in terms of both hardware and software, so games were often limited to certain devices.

With Apple’s AppStore in 2008 though, mobile gaming became widely adopted as a result of games being centralised in one store. Around 80% of games on mobile were paid for in a one-time transaction in 2008, following the same model that consoles did. This however had two major drawbacks – the games were naturally smaller in scope as compared to their console counterparts (as a result of being made for the phone) and the audience for mobile gaming was still rather limited.

The game Tap Tap Revenge, a free game in which players kept up with popular songs by tapping the right spots on the phone screen, was the 2008 most popular free iPhone game of the year. The developers released a premium version of the game for $4.99 and paved the way for freemium games where while the basic version of the game is free, upgrades and addons cost more.  In 2009, Apple enabled in-app purchases for free apps, adding a new monetization route for F2P games. 2011’s Temple Run originated as a premium app, retailing at $0.99, but quickly switched to F2P. Temple Run lasted only one month on the market as a paid app before becoming free. App revenue immediately increased 10x once they switched to a freemium model. Less than 6 months later, by January 2012, Temple Run was the #1 top grossing app. Today, only 4% of apps on the Play Store are paid. Temple Run and Angry Birds started off as paid games, but Candy Crush Saga launched in 2012 as a F2P game with IAPs (in-app purchases) from the start. In just a year, it became the highest grossing mobile app, making about $1 million every day worldwide. The game makes a lot of money simply from offering committed players the option to buy boosters that can help them solve difficult levels. 

Finally, instead of targeting just those willing to spend in game, developers and publishers decided to hit everyone- with ads. In-app advertising was initially a concern – it might lead to a negative gaming experience if overdone and might also impact IAPs. However, creative ad formats, such as those awarding in-game items for watching or playable ads, were actually received positively. Everyone wins in this situation: Gamers who engage with rewarded ads are up to 6x more likely to eventually opt in for an IAP which benefits game publishers. In-app adverts also work great for marketers because players who see rewarded videos are 23% more likely to buy the products advertised. And for the gamers themselves, well 73% of them said that they’re happy with the ad model of monetising mobile games. In fact, hyper-casual users watch 2x more video ads on average than players in other gaming categories.

While game developers know that there is a huge market for the right games, they still have to figure out how exactly they can profit. There are several revenue models available for mobile games and these are:

  • Paid games: This is the simplest revenue model. You pay a one-time fee to download a game. An alternative way of doing this is releasing a free version with ads and a premium version with no ads and more content which you can buy with a one time payment. This is how Angry Birds did it on Android. You can also release the first chapter or part of the game for free and then charge for the rest of the game.

  • F2P with in-game transactions: The games themselves are free which lets the users try them out without having to buy them, increasing the user base. Once in-game, players have the option to purchase in-game perks, abilities, upgrades or items which help you progress further ahead in the game. A key example of this would be extra lives in Candy Crush Saga. They also have the choice to avoid this and continue playing the game normally. On average, only about 4% of players make a purchase within a game. The players who make these purchases often repeat them and hence are the primary sources of income for the game.
Candy Crush creates opportunity for generating income by letting players buy in-game items.
  • F2P with adverts: There are numerous ways for advertisements to appear in games apart from just the full-screen ads or the banners that appear on the screen headers and footers. Increasingly subtle approaches are being taken by brands such as the sports drink brand Gatorade. They gave players a digital boost through energy refills in EA’s Madden NFL Mobile, letting them play longer.

    Rewarded ads are currently the leading ad format on mobile. Instead of having an ad forced onto them, players choose to watch a video in exchange for a bonus. Playable ads are also rather popular. Gameloft worked with Indian online retailer Myntra for a playable ad campaign that received an impressive 82% completion rate and 2.1 million impressions in just under two months.


  • Subscription models: Games may also have subscriptions that grant the player more items and even on occasion, an edge over normal players. Games with this form of monetization usually track live data and are updated based on it. Periodic sales, offers, and in-game items that are otherwise unobtainable are presented. Fortnite and its battle pass where users have to play to unlock premium cosmetics after buying the pass are another way to increase play-time while also maximising revenue. Game pass subscriptions are also well-loved, since they give a lot of games and additional content for a one-time fee.

Popular Categories in Mobile Gaming

Games have always been the most popular category in the Apple and Google app stores, no matter which metric you consider –  the number of active apps, number of downloads, time spent, or revenue generated. Games represent 10% of the time spent on apps. On average, there are 8 games installed per mobile device in the US. Globally, smartphone users play an average of 2 to 5 games per month.

Hyper-casual games are the most played by far, with a staggering 30% of all-app downloads. This could be attributed to the ease of learning the game and the fact that these games are usually free. Next up are puzzle and arcade games, both of which are highly engrossing and possibly addictive. The graph below shows the exact breakdown of different game genres and their global downloads.

The exact breakdown of different game genres and their global downloads. Courtesy: App Annie.

Mobile Gaming - The New Social Network

While mobile games have been popular during the last decade, the 2020 pandemic gave the industry a huge spurt. According to a report, ‘63% of respondents reported an increase in gameplay time, more so in countries hard hit by COVID-19 — with an estimated 75% of the net rise in mobile gaming activity to remain after the “new normal” is established in the next two years.’

In China, which had a national lockdown much earlier than other countries, downloads of mobile games peaked at 284.3 million in February 2020. The same trend could also be seen in other regions as they entered lockdown. Since then, social mobile games have offered users worldwide a way to stay entertained and connected throughout the global pandemic. Games like Among Us in particular saw a huge increase in popularity and this could be because of how team-mates in game have to work together to complete tasks while trying to hunt out the imposters out to get them.

Games like Among Us in particular saw a huge increase in popularity during the pandemic.

Social mobile games are a type of mobile game that includes social features, enabling players to interact with each other during gameplay via messaging and integrated social media. Game developers and marketers benefit from social mobile games’ ability to build a community and keep users engaged for longer, boosting ad revenue, and return on advertising spend (ROAS). Some essential features of these games include:

  • Chat functionality to bring you closer to your fellow players
  • Leaderboards and activity feeds where you get updates as to how your friends are doing.
  • Social media integrations to your other apps 
  • Push notifications to ensure you constantly stay connected
  • Clan and guild mechanics to make you feel like you’re part of a community

The Future of Mobile Gaming

It’s quite clear that mobile gaming isn’t going anywhere except up. The next question that occurs of course is – what comes next? Here are a few trends that are pushing the envelope.

Mergers and Acquisitions: How They’re Allowing The Biggest Game Companies to Find Their Footing in The Mobile Game Industry

In the past few years, mobile gaming has received a lot of attention from companies who’re looking to buff up their portfolios and profits. Since launch, Pokémon Go has generated $2.3 billion in revenue and Fortnite has amassed some 250 million players. Perhaps in an attempt to replicate such success, the first substantial investments in mobile gaming came from those who already had a stake in the industry. Tencent invested $90 million in Pocket Gems, gaming powerhouse Supercell invested $5 million in mobile game studio Redemption Games, Boom Fantasy raised $2 million from ESPN and the MLB, and Gamelynx raised $1.2 million from several investors. 

The first investment from an arguably old-school enterprise came from Goldman Sachs, who invested $200 million in hyper-casual mobile gaming studio Voodoo. In July 2018, private equity firm KKR bought a $400 million minority stake in AppLovin and a year later, Blackstone announced their plan to acquire mobile ad-network Vungle for a reported $750 million. Take Two and Microsoft are also foraying into the mobile platform with their acquisitions. The former’s acquisition of Zynga lets them get their hands on cash generators like Farmville while also letting them learn how to make successful F2P mobile titles from a proven expert. 

Cross-platform play is one of the hardest to achieve features a game can have. The differences in software architecture which different platforms such as Xbox, PlayStation, and PC have make creating ports for all of them simultaneously an onerous undertaking. It might also lead to one particular platform being favoured over others, such as in the case of Fortnite, where although there is a large player base for both console and mobile devices, the mechanics are easier on PC. For competitive play, Epic Games decided to create separate tournaments and lobbies to overcome these issues, but if you’re a console player looking to play with your PC friends, odds are your game will suddenly jump in difficulty. However, games like Genshin Impact have proven that cross-platform games when done right can increase your net revenue while also increasing your player base significantly. Perks like this can make cross-platform the new standard games aspire to, and increase mobile gamings’ already massive audience.

Technology like Cloud Gaming, AR, and 5G Make Mobile Gaming’s Future Bright

5G is shaping up to be a game changer for connectivity thanks to its faster speeds and higher data bandwidth. As a direct result of this, applications like cloud gaming, AR, and the like are looking increasingly viable for mobile devices.

Cloud gaming is expected to grow from 3 million active users in 2019 to 177 million active users by 2024. One of the biggest obstacles to playing immersive games with detailed graphics and worlds are the lack of processing power on mobile devices as compared to a PC or even a console. However, cloud gaming can help mitigate this. Many leading online gaming providers are planning live events – such as Travis Scott’s five-day concert event on Fortnite – and those kinds of experiences can be provided through the cloud as a result of the benefits developments in 5G have fostered. These include low latency and an increase in the bandwidth of networks.

Another kind of technology which has already demonstrated its rather amazing suitability for mobile devices is AR. Mobile phones are perfect for the kind of interactions AR requires. This is a result of significant improvements in hardware over the last decade, higher camera quality, and improved internet access. Verizon, Deutsche Telekom, EE, Globe Telecom, Orange, SK Telecom, SoftBank Corp. and TELUS have joined Niantic’s Planet-Scale AR Alliance, which has a mission to create “amazing real-world AR experiences that demonstrate the possibilities of 5G.” Several years down the line, Pokémon Go is still going strong and has seen tie-ups with major companies like Starbucks. It seems to merely herald a future where AR can layer a whole new dimension atop our existing reality.


How AR and Pokemon GO layer a whole new dimension atop our existing reality.

Finally, the mobile esports industry has boomed in recent years alongside traditional esports. Mobile esports viewers worldwide amounted to over 400 million in 2019. Of the most watched esports tournaments worldwide, the 2021 Free Fire World Series in Singapore drew in over five million peak viewers, while the PUBG Mobile Global Championship reported nearly four million peak viewers. The highest grossing mobile game worldwide as of 2021 was PUBG Mobile, the mobile version of the well-known battle royale game PUBG. In 2021, the global mobile gaming content market was worth $131.2 billion and is projected to reach $173.4 billion by 2026.

The Biggest Mobile Gaming Market: APAC

Mobile gaming is likely to skyrocket, especially in regions like Asia Pacific (APAC) where mobile phones are the most accessible devices for people to game on. By the end of 2021, the region had 1.62 billion gamers, or 55% of players worldwide, up from 1.2 billion gamers in 2019. Improved internet infrastructure and accessibility as well as technological literacy is on the rise in this region. A lot of the successful games in the region such as PUBG Mobile and Free Fire have set the global standard for in-game social features like game chat, friendlists, leaderboards, and PvP modes. APAC players were estimated to have spent $57.9 billion on mobile games in 2021. This is definitely a market for players in the mobile gaming industry to constantly keep an eye on.

We’ve come a long way from the likes of Snake and it seems unlikely that the growth of the mobile gaming industry will slow down any time soon. Gameopedia works with clients across the gaming industry on custom requests and can provide in-depth game data and insights for mobile games. Reach out to us for data that can power your business to new heights.

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Why Telecom Companies Should Look At Gaming As Their Next Big Frontier

The video games industry generated almost $180 billion in 2020. In 2021, the video game market size in just the United States surpassed $85.86 billion. With such a massive market on the table, players from several different industries are looking to invest and diversify for a piece of the pie. Telecom companies are one of these players. The telecommunication sector is made up of companies that make communication possible on a global scale, whether it is via wires or wirelessly, or through the phone or the Internet. AT&T, Verizon, and T-Mobile are some examples of telecom companies. 

Telecom companies are looking to diversify their offerings for a variety of reasons, the foremost of these being that their traditional revenue streams are falling behind and their markets are being saturated. This is a result of their core markets such as television, voice and messaging, and even music being undercut by services like Netflix and Spotify. While they’re losing out on revenue, they also have to keep improving their mobile data infrastructure thanks to the massive increase in mobile data consumption. To make things worse, churn rates (customers switching providers) are particularly high in the telecom sector, averaging between 10 and 67% annually. It is estimated that 75% of the 17 to 20 million subscribers signing up with a new wireless carrier every year are coming from another wireless provider. 

It isn’t all bleak though. Telecom companies have a considerable advantage when it comes to today’s increasingly digital world. They have access to a huge customer base, an upper hand when it comes to infrastructure, and a good understanding of customer behavior and brand awareness. These advantages can be used while investing in new areas such as media, entertainment, and of course, gaming. 

The Potential of the Gaming Market

As a result of the COVID-19 pandemic, gaming’s popularity has surged to new heights and telecom operators have already started investing in areas related to gaming on a huge scale. This shift in behavior appears to be well-established: gaming is much more than just a hobby, it provides entertainment and community for millions of people around the world. The gaming industry is estimated to be worth more than $270 billion dollars by the end of 2025. Lucrative areas like cloud gaming and gaming as a service (GaaS) both pivot upon 5G service providers being able to deliver low-latency and high bandwidth connections. In fact, for both mobile and other platforms, but especially the former, 5G is the next revolution whose infrastructure is in the hands of telecom companies. Cloud gaming can reduce the price entry barrier as customers don’t need expensive hardware. How they create value from it and monetise it successfully is their focus. Some of the roles telecom operators can play in the mobile gaming ecosystem include:

  • Infrastructure provider– Telecom operators can use their technological capabilities to assure the quality of service and monetise it. They can also use their infrastructure to improve mobile edge computing capabilities.
  • Ecosystem development partner– They can partner with gaming service providers and help develop new devices, content, and infrastructure and also educate customers on the value they’re building.
  • Sales partner- They can sell gaming as a service they offer, whether it’s their own games or third-party titles.

We’ll look at these in more detail later.

What Telecom Companies Gain by Entering the Gaming Market

As we have already seen, there are several value propositions for telecom operators looking to establish themselves in gaming and it’s important to note that while there might not be significant revenue increases in the short term, there will be several long-term benefits. Some of these are:

  • Brand positioning and popularity amidst younger audiences.
    If you were to ask the younger generation about telecom operators, odds are they’ll dismiss them as phone service or broadband internet providers. These services are rather old-fashioned and might lead to these companies being seen as tiresome vendors selling uninspired, if necessary services. However, by associating with video games and the gaming industry and creating exciting value propositions such as low-latency connections, these companies might be viewed as game-changers. A great example of this is Verizon’s tie-up with Riot Games and its amazing promotional material. Verizon has partnered with Riot Games and invests heavily in the esports scene. The three-year partnership will allow Verizon to work with Riot Games to transform the gaming experience for developers, players, and fans alike. 
Verizon's three-year partnership with Riot Games has allowed them to transform the gaming experience for developers, players, and fans.
  • Building increased customer loyalty.
    Churn rates are particularly high in the telecommunications industry, averaging between 10 and 67% annually.  If the newer generation is impressed by an operator’s venture into gaming and what they do in the space, then this may increase engagement and loyalty. 

  • Higher average revenue per user (ARPU).
    Let’s look at the previous example of Verizon, which partnered with Riot Games to be League of Legends’ LCS league’s Official 5G Wireless and Network Service Partner. The increased publicity and visibility for Verizon means it is likely that if their service is good enough, they’ll gain more customers. One more thing to note is that gamers tend to have higher data and internet usage and this can offset declining sources of income for telecom operators such as voice calling. Dedicated game-related products and services can also contribute to the ARPU.

  • Improved customer experiences.
    An increased number of customers using gaming services can lead to operators having greater amounts of data related to their behavior. This will help them understand what customers appreciate and require and provide better customer services. For instance, Telkomsel partnered with those behind PUBG Mobile to activate special in-game offers for their customers. The success of this convinced them to launch their first mass online battle arena and first-person shooter game Shellfire, which was well-received by their audience.

Telkomsel's release of their MOBA FPS Shellfire was extremely well-received by their audience in Indonesia.

How Telecom Companies can Enter the Game Industry

  1. As a distributor: Telecom companies can acquire rights to exclusive releases and create packages specially for gamers with value add-ons like increased speed or bandwidth.
  2. As developers: Telecom operators can participate in game development and offer localised servers, apart from doing everything distributors do. They can even own game development end-to-end, as Telkomsel did with Shellfire.
  3. Involvement with game publishers and platforms: Telecom companies can collaborate with game developers and publishers which build gaming technology. A good example of this would be SK Telecom announcing an exclusive operating partnership with Microsoft’s cloud gaming service in Korea. Based on this relationship, SK Telecom is expected to help Microsoft strengthen its position in the mobile gaming market by leveraging its world-leading mobile infrastructure. US operator AT&T joined forces with NVIDIA to offer 5G GeForce NOW subscriptions, which it claimed offers “one of the world’s best gaming experiences.”
  4. Investment in esports: Telecom companies can sponsor game tournaments to appear as an important part of the ecosystem and build goodwill and a following. A great example of this is Verizon x Riot Games where the former is the title sponsor for their game VALORANT’s ‘Game Changers’ series in North America

Key Avenues Telecom Operators Could Invest in

Telecom companies are already equipped to secure an immediate foothold in the video game industry by utilising their existing capabilities. We’ve looked at the benefits for telecom operators already, but which areas are advantageous for them to invest in? One is 5G, which is shaping up to be a game changer for connectivity thanks to its faster speeds and higher data bandwidth.

  1. Cloud Gaming: Telecom companies should look into cloud gaming as a frontier to capitalise on the investments they’ve made in the 5G space. They have already invested in bringing about low latency for 5G networks. By offering dedicated 5G connections to gaming companies that then offer a low-latency experience to their end customers, telecom operators can transform gaming on the go while also expanding their customer list. Cloud gaming is expected to grow from 3 million active users in 2019 to 177 million active users by 2024 so this is definitely an area worth considering. They can also partner up with gaming companies that would like to leverage the telecom operator’s customer base.


  2. Game Development and Publishing: Game developers and publishers can tie up with telecom companies with exclusive deals which both parties can benefit from. One of the best examples of this was Telkomsel and the people behind PUBG Mobile offering a data plan which was a great deal for the customer. Operators can also have their own app stores where exclusive games can be downloaded and played. Eventually, Telecom companies can even develop and publish their own games, such as Telkomsel’s release of Shellfire.


  3. Games as a Service: By providing low-latency and high-bandwidth connections, whether 5G or wired, Gaming as a Service (GaaS) is much more viable, especially with cloud gaming getting a buff. This reduces the need for expensive hardware and increases accessibility as well — gamers can play anywhere, anytime as long as they have a laptop/tablet, and a good internet connection. Telecom operators can use their existing infrastructure to tie-up with both game publishers and developers. They can also, like mentioned previously, eventually develop their own games.


  4. AR and VR: Mobile phones are perfect for the kind of interactions AR requires. This is a result of significant improvements in hardware over the last decade, higher camera quality, and improved internet access. Verizon, Deutsche Telekom, EE, Globe Telecom, Orange, SK Telecom, SoftBank Corp. and TELUS have joined Niantic’s Planet-Scale AR Alliance, which has a mission to create “amazing real-world AR experiences that demonstrate the possibilities of 5G.” For VR, the data requirement is also quite high and raises the question of whether networks are capable of providing the necessary connections. Telecom operators have the infrastructure ready for both 5G technology and high-speed internet. The networks that can handle the high-resolution images, videos, and data required by new games and apps will likely be the ones that get the most customer retention and loyalty. 
Niantic’s Planet-Scale AR Alliance has a mission to create amazing real-world AR experiences that demonstrate the possibilities of 5G.

Examples of Telecom Operators Successfully Entering the Gaming Space


Telkomsel is a leading Indonesian telecom operator that has managed to integrate gaming into its offerings quite successfully. It has achieved a 22% market share of Indonesia’s gaming industry. They did this with their multi-pronged approach, including dedicated offerings for gamers, partnerships with popular games, and investing in Indonesian esports.

Initially, it launched its Dunia Games web portal in 2013, where customers could download games and directly charge them to their phone bills. In 2017, in an initial developer play, Telkomsel partnered with the folks behind games such as PUBG Mobile to activate special in-game offers for customers subscribed to their dedicated online games data package.

It then switched to its own game releases with the successful launch of Shellfire, in 2018 — with plans to develop seven additional games. All this time, they were active on the complementary front of esports — they launched the Indonesia Games Championship eSports tournament as well as PUBG LAN events. They also boosted the Dunia portal with gaming articles, reviews, and trend reports.

Telkomsel's Dunia Games organised and launched the national Indonesia Games Championship as well as other LAN events.


Verizon has been very active when it comes to creating excellent value for their 5G and AR offerings. It was one of the first global members of the Niantic Planet-Scale AR Alliance, which is creating 5G-ready AR services for consumers. It also has a partnership with Niantic, best known for developing AR-based game Pokémon GO, for exclusive collaboration on high-performing interactive experiences for gamers. It recently announced that it, along with Doug Liman’s 30 Ninjas and in association with France-based immersive studio Novelab, will collaborate on an Augmented Reality (AR) Adventure Thriller.

Verizon was also giving away 6 and 12-month subscriptions to Apple Arcade and Google Play Pass to add more bundled content offerings to their wireless subscriptions. In recent years, it has also partnered with Riot Games, Electronic Arts, Dignitas, and Team Liquid for the development of new services in the esports and the gaming space, utilising its 5G network and real-time Mobile Edge Compute (MEC) technology. Their partnership with Riot Games and investment in North America’s esports scene has helped build their reputation and credibility with game enthusiasts. Verizon’s status as the official 5G network for League of Legends‘ LCS, and as the title sponsors for VALORANT Game Changers NA has given it  a certain cachet.

Verizon being named the official network provider of the LCS has given them a huge publicity boost.

In addition to Verizon, Deutsche Telekom, EE, Globe Telecom, Orange, SK Telecom, SoftBank Corp. and TELUS have joined Niantic’s Planet-Scale AR Alliance, which has a mission to create “amazing real-world AR experiences that demonstrate the possibilities of 5G,” including ultra-reliable low latency, enhanced mobile broadband, network slicing, and edge computing. Several telecom operators have also made investments in cloud gaming, 5G infrastructure, and esports. 

Esports as an industry especially has unique factors which make it extremely attractive to telecom companies. It needs high-definition broadcasting capabilities, high-speed and quality connectivity, low latency, and more. Telecom operators already have a leg up in that regard as they’re used to delivering such services and can use esports as a platform to announce their capabilities to a wider audience in the gaming industry. If someone’s favorite game or player is known to use a particular service provider, odds are they’ll see a spike in ARPU.

The Future of Gaming and Telecom Providers

We’ve looked at how and why telecom companies can benefit from investing in the gaming ecosystem. But what does the future look like for both these operators and the industry as a whole?

It seems likely that telecom companies will be able to add gaming to their service bundles and use third-party content to generate value. In fact, they can capitalise on existing problems such as those arising due to platform monopolies to create opportunities for both their customers and themselves. Lawsuits like the one where Epic sued Apple and Google for forcing it into a payment system where the app stores got a thirty percent cut of all individual transactions on the platform, such as skins, battle passes, and the like are a consequence of such monopolies. As a result, Apple removed the game from their store and gamers could no longer access it on their devices. Telecom companies could step in and provide access to these apps to their customers via their own app stores or cloud platforms. Game developers and platforms might be more open to using telecom operators for billing and aggregation.

Epic Games made a pointed parody of Apple's original '1984' trailer after Fortnite was removed from the Apple App store.

There is also a rising interest in edge computing, especially for mobile devices. With the huge market for mobile gaming, telecom operators who can deliver on this front will likely profit significantly. They are also ideal providers considering their existing investments and infrastructure. Other opportunities in the gaming industry which we’ve looked at are AR, GaaS, and cloud gaming. We’ve already looked at several partnerships which are succeeding so far, but only time will tell the magnitude of this success. We’ve also examined how esports and telecom companies investing in the industry can benefit them through both increased revenue and reach. Apart from providing high-quality connections, they can also enable and promote esports tournaments, build online communities, and create esports content that can boost engagement. If done properly, telecom companies can create experiences that will win them loyal customers who also advocate for them and increase ARPU.

If you’re a telecom company looking to venture into gaming, we can help. Gameopedia works with clients across the gaming industry on custom requests and can provide in-depth game data across PC, consoles, and mobile games. Reach out to us for data that can empower you to new heights. 

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8 Major Gaming Trends to Look Out for in 2022

Things have never looked better for the video game industry. It has grown exponentially over the last few years and the rate of growth doesn’t seem to be slowing down any time soon. It is estimated that over 2.5 billion people around the world play video games, and they contributed to the video game industry’s record-breaking 2021 revenue of $180 billion. The global gaming market is set to reach $256.97 billion by 2025. 

Global video game market value from 2020-2025, courtesy Statista.

There are several trends that have driven this explosive growth in revenue and audience: let’s look at those likely to be relevant in 2022.

Gaming Trends to Look Out For in 2022

1. The Massive Growth of Mobile Gaming

When it comes to gaming, a massive trend over the past decade that is only increasing in prominence is the rise of mobile gaming. The market for mobile games is expected to register a CAGR of 14% between 2020 and 2025. This is a result of improving technology when it comes to smartphone hardware and the growing penetration of these devices as a direct result of cheap internet data packs. Mobile games also often prefer the free-to-play (F2P) revenue model as it increases the number of downloads by users. This is because players can try out a game before deciding if it’s something they like and want to invest their time and money in. One of the things to note is the play-to-earn (P2E) business model which is slowly gaining popularity. Developed with blockchain technology (we’ll look at this in detail later), P2E games let players generate real income held in a crypto wallet, which means that even if they leave the game or it shuts down, they’ll be able to take these assets with them.

Mobile gaming has surged in the last decade with improvements to both mobile hardware and internet.

The sheer volume of gamers who play on smartphones and tablets makes it the biggest gaming platform. A survey in 2021 found that 68.1 percent of respondents stated that they played games via smartphone, making it the most popular gaming device worldwide. According to AppAnnie, consumers spent 50% more on mobile games than all other gaming platforms combined in 2021. Experts believe this trend will continue in 2022 as more games will support cross-play gaming. Asia-Pacific is emerging as the major contributor to the growth of the global mobile gaming industry. 

AAA mobile game releases are also likely to increase. The recent success of miHoYo’s Genshin Impact as well as that of prior releases like Fortnite, PUBG Mobile, and Call of Duty Mobile have proven that AAA mobile gaming experiences are not only popular but also highly profitable. A month into Genshin Impact’s release, it was downloaded 15 million times and earned more than $150 million in revenue. The key to successful AAA mobile game releases are high-quality graphics and a game experience similar to what you’d get on a PC or console.

Finally, gamers are increasingly looking for mobile games that come with social features. In fact, according to App Annie, roughly two-thirds of the top 50 mobile games have at least one social feature. These include in-game chat, guilds and clans, co-op and PvP modes, social media connections, and more. 

2. Cloud Gaming Becoming Viable

For many years, gamers have been waiting for innovations that would make cloud gaming go mainstream. It has the potential to revolutionise the gaming and entertainment industries by eliminating the need for expensive hardware and enabling remote access to game content. The prominent cloud gaming services in the current gaming ecosystem include PlayStation Now, Xbox Cloud Gaming, Amazon Luna, and Nvidia’s GeForce Now. Google has also committed to bringing at least 100 new games to their cloud service Stadia by the end of 2022. The future only seems brighter as cloud gaming is expected to expand at a compound annual growth rate (CAGR) of 48.2% from 2021 to 2027. 

Some of the notable cloud gaming platforms: at their price, definitely an attractive bet to people who don't want to invest in expensive hardware.

We’ve already looked at the advantages and the future of cloud gaming in detail in one of our previous articles. With cloud gaming, you don’t need to upgrade your PC or console. Instead of buying expensive gaming hardware, a basic laptop or even a mobile phone would do. You can play games on any OS or Device. Gaming on the cloud would allow games to become more platform-independent, allowing PCs and tablets running Mac, Linux, Android, and other operating systems to support games that might otherwise only run on Windows.

Other benefits include being able to start playing games instantly, as the server already has the game installed and can load the game immediately. This helps avoid waiting for patch updates. Cloud services would allow for very easy spectating of games, such as professional gaming matches. With the significant improvements in internet infrastructure, speeds, and bandwidth, streaming games might become prominent in 2022. The lack of a need to download periodic updates and possibilities of large-scale multiplayer gaming also improve its appeal.

3. Blockchain Gaming and NFTs

A blockchain is essentially a chain of data blocks on a computer network that is transparent to all of its users as well as anybody else. It cannot be altered or relocated. This way, a complete record of everything that has transpired on the network in relation to the data is preserved. Blockchain gaming is a means of turning digital assets inside video games (such as collectibles or cosmetic skins) into real-world assets in the form of NFTs or non-fungible tokens. Because of its liquidity and the fact that gamers are used to tokenization, implementing blockchain in gaming is fairly simple. 

From a zero-value market size, the blockchain gaming industry grew to
$3 billion in 2021 and is projected to rise to $39.7 billion by 2025. Fuelled by free-to-play and play-to-earn models, the blockchain gaming industry has attracted over 1.5 million diverse gamers across the globe. According to January’s report by popular data resource, DappRadar, blockchain-based online games received over $1 billion in funding in January alone, as compared to 2021 seeing investments worth $4 billion in total.

Cryptokitties is an online game that runs on the Ethereum blockchain. The game involves a play-to-earn model of buying, selling, and breeding digital kittens. By December 2017, players had already spent an incredible $ 6.7 million in-game. The most expensive
Cryptokitten was sold for $172,000. One of the most popular recent blockchain games is Axie Infinity, which is a play-to-earn NFT blockchain game built on the Ethereum network. During the game, players earn Smooth Love Potion tokens, which can be traded for real money through a cryptocurrency exchange. Axie Infinity has made over $4 billion in NFT sales since its launch. It also shows that there have been 14.45 million transactions and 1.62 million buyers since its inception.

Cryptokitties has had several million being spent in-game and was almost revolutionary (and adorable to boot!)

Blockchain gaming comes with a few advantages. Firstly, it improves security. It is nearly impossible to hack into data across servers because of blockchain’s strength of decentralization and highly effective data encryption measures. Gamers and developers can also leverage blockchain technology to construct resource-rich games and apps, as well as upgrade game versions and earn awards through blockchain gaming mining procedures. The big question is what can NFTs and related blockchain concepts bring to games that don’t already exist, or can’t be replicated with centralised approaches? Another major problem is the lack of regulation of NFT transactions which has led to several scams.

As things stand, NFT games face many challenges, some of which include:

  • Valve has banned crypto- and NFT-based games on Steam, the biggest PC storefront, inhibiting NFT growth on PC.
  • South Korea has banned crypto-based games on Google Play and the iOS App Store, limiting growth in one of mobile’s highest-spending markets.
  • Players have advocated against NFTs in games, as shown by the backlash to Ubisoft’s Ghost Recon NFT announcement.

4. The Metaverse

One of the biggest things to look out for is the Metaverse. The metaverse may be worth $800 billion by 2024 due to a surge in interest during the pandemic. That’s up from $47 billion in 2020.  Facebook’s rebrand to Meta is a sign that they, one of the biggest tech companies, believe it is the future. Meta has also announced an investment of $10 billion over the coming years to develop metaverse technologies. In October 2021, Tencent established the F1 studio under the subsidiary TiMi Studio Group for focusing on metaverse development. In June 2021, Epic Games said that it has secured $1 billion in its latest round of investments in its quest to create the metaverse, a realm of interconnected virtual worlds like those depicted in novels like Snow Crash and Ready Player One.  Disney is developing a metaverse theme park

But what is the metaverse?  A
New York Times article described it as “a variety of virtual experiences, environments, and assets that gained momentum during the online-everything shift of the pandemic. Together, these new technologies hint at what the internet will become next.” Despite the lack of a universal definition, the metaverse is already seeing massive traction in the video games industry with Epic Games and Roblox blazing the trail. 

For instance,
Fortnite — an Epic Games property — hosted a virtual concert that was attended by over 12 million people, and a collaboration between Roblox and Gucci created a virtual Gucci Garden space that sold limited edition virtual bags. One of the digital bags even sold for $800 more than the actual, tangible version! Both of these companies are a great example of how the metaverse can be a superb virtual environment where everyone within can interact and enjoy immersive experiences and stories. While some might simply want to log into the latest FPS game to shoot guns with their friends, others will find room in these worlds to engage in socialising, chatting, or other forms of shared interaction.

Travis Scott's Fortnite concert set a record for number of attendees and was a global phenomenon.

5. Acquisitions and Consolidations in the Gaming Industry

In the last few years, we’ve been seeing an increased number of acquisitions and mergers in the video game industry. Behemoths have been acquiring smaller companies to improve their offerings, acquire IPs, and expand their audience base. In 2021, there was a spree of acquisitions starting off with the acquisition of Activision Blizzard by Microsoft for the massive sum of $68.7 billion and Sony acquiring Bungie for $3.6 billion. Several more have come through, such as Sony acquiring game development company Haven Studios and Borderlands developer Gearbox acquiring 250-person indie dev team Lost Boys Interactive to work on Borderlands 4 and a fresh IP. Other significant acquisitions include 2021’s newly-public ironSource acquisition of Luna Labs, Soomla, Bidalgo, and Tapjoy. Liftoff and Vungle merged and acquired GameRefinery, AlgoLift, JetFuel, and TreSensa.

This is true of the mobile gaming sector as well, with mobile
gaming giant Zynga acquiring two big Turkey-based developers: Peak Games for $1.8 billion and four-fifths of Rollic Games for $180 million. In 2020, they also announced the acquisition of a Chinese studio – StarLark for $315 million. Embracer Group acquired a total of seven studios in 2021. They also entered into an agreement for $300 million to acquire the development studios Crystal Dynamics, Eidos-Montréal, Square Enix Montréal, and a catalogue of IPs including Tomb Raider, Deus Ex, Thief, Legacy of Kain and more than 50 back-catalogue games from Square Enix Holdings.

6. Games and Cross-Media Storytelling

Recently, there seems to be a barrage of high-standard, hugely grossing media being released based on video games. The release of Netflix’s Arcane (based on Riot Games’ extremely popular game League of Legends) and The Witcher series (the characters based on Andrej Sapowski’s books which became world-famous after the release of the games) have proved that games can also be adapted into media and other IPs which can be extremely successful.

The Witcher is one of Netflix's most popular releases and has been renewed for a third season already.

“The Witcher,” was on track to be Netflix’s biggest first season ever for a TV series. Netflix said through its first four weeks of release, 76 million households watched the fantasy series. Future releases are also under production, such as the upcoming Last of Us and Borderlands series based on the games of the same name.

There are also reboots happening of franchises that were initially less than successful, such as the Resident Evil movies. It is being remade into Resident Evil, a new live-action series based on Capcom’s legendary survival horror game franchise, and is coming to Netflix. Another example is the Tomb Raider franchise, whose movies were box office failures. However, Netflix, Crystal Dynamics, Square Enix, and Legendary Television are teaming up for a brand new animated series based on the video game franchise to inject some life into the reboot.

7. The Explosive Popularity of Esports

In 2021, the global esports market was valued at just over $1.08 billion, an almost 50 percent increase from the previous year. This number is expected to increase massively with significant investments being made by game publishers, gaming organisations and their sponsors, and other parties in the gaming ecosystem. If you want to read more about this as well as revenue channels, trends, and the future of esports, check out our article where we get into the details.

Significant revenue comes in from sponsors as well as ads on broadcasts of tournaments, especially international ones. There are also other areas that are likely to explode in 2022 though and the foremost among these is esports betting. The
global esports betting market size is expected to reach $13.05 billion by 2025, from $7983.2 million in 2019. The number of esports events one can bet on is also growing exponentially, from 3,000 events available in July 2019 to over 50,000 events in July 2020.

Finally, with restrictions due to the Covid-19 pandemic finally being lifted, a lot of offline events are being planned. These kinds of events are usually held in huge arenas, with thousands of fans attending. This helps significantly with publicity and media impressions as well as increased revenue from ticket sales, limited-time merchandise, and more.

Esports isn't just about games, it's a cultural phenomenon across the planet.

8. VR and AR Gaming Developments

Since the release of novels like Ready Player One and Neuromancer, a fully-immersive virtual universe has been a dream for tech giants, gaming enthusiasts, and the like. VR technology is the furthest humanity has gotten to that lofty goal. Thanks to the falling price of hardware, VR gear such as headsets is becoming increasingly affordable. They also benefit from being capable of functioning both as standalone devices and being connected to a gaming PC to take advantage of their dedicated hardware to enable even more immersive and graphically-rich VR experiences. We’ve gone into VR and its evolution in detail in this article.

VR is the closest humanity has gotten till date to a fully-immersive online experience.

The global VR market was valued at $7.7 billion in 2020 and is projected to reach $26.8 billion by 2027 with a CAGR of 19.0% during this period. In the near future, cloud VR could become a reality – further reducing the size of headsets. 2022 might even see the release of Apple’s long-rumored VR headset (though there is no release date yet) as well as the Oculus Quest 3. The PSVR 2 is also due to launch towards the end of 2022. It is the next-generation VR headset that Sony is currently working on and will work exclusively with the PS5 games console. While Meta hasn’t provided an ETA for its next wave of VR products, according to XR hardware analyst Brad Lynch, Project Cambria could release before the Oculus Quest 3. The insider claims that the high-end Metaverse headset will release in Q2 2022, while the Quest 3 will make its debut at Meta’s 2023 Connect event. It is very likely that VR could see a lot more takers in the near future and might even be a major trend in 2022, depending on when the aforementioned technology gets released.

These are the trends which should have significant ramifications for the gaming industry that you should watch out for this year. We work with clients across the industry on custom requests and can provide in-depth data about games such as detailed game breakdowns which can help you identify trends. Reach out to us for data that can empower you to new heights. 

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The Evolution of First Person Shooter (FPS) Games

One of the most popular types of video games is the FPS or first-person shooter. According to a global gamer survey held in 2020, the second most popular genre was shooter games, with 50.5 percent of respondents stating they’d played shooter games in the past year.  The market for FPS games has also steadily risen over the last decade.

But what exactly are FPS games?

The First-person Shooter or FPS is a subgenre of action-packed shooter video games typically centered on combat involving guns and other weapons that fire projectiles from a first-person perspective. These games are often an entry point into video games these days, with games like the Call of Duty and Halo franchises which are huge hits for both console and PC, or games such as Counter-Strike: Global Offensive, which has retained its massive fanbase and popularity over the past decade and thrived as an Esport. Why are these games so popular though? 

For those who enjoy the thrill of shooting guns and immersing themselves in a virtual battleground, First-Person Shooters are where it’s at. It’s not just for the gun-nuts though —  FPS games test your ‘gamer instincts’. The quickness of your reflexes, your awareness of the environment, and how well you coordinate with your team — you’ll need all of these in spades to win.

Indeed, in one of our previous articles, we’ve gone into the motivations for people playing video games and FPS games manage to score solidly on multiple fronts. Let’s now take a look at how they came about.

The History of FPS Games

FPS games have been around for almost 50 years now. They’ve had their ups and downs but have almost always been popular. 

The 70s

The first real attempt at an FPS game was in 1973 with Maze War being installed at the NASA Ames Research Center. Players could move through a 3D maze slowly, while also shooting other players who appeared as eyeballs. Sure, it didn’t look flashy, but it was new and the concept unprecedented.

Maze War
Maze War

The 80s

In the 80s, arcades were the place for gamers to be, and the ancestors of today’s FPS games started popping up. The first of these was Atari’s Battlezone. This game allowed players to pilot a lethal assault tank moving across a (rather bland) landscape filled with enemies. You could rotate and move in any direction and blast the baddies away (as a tank should!) Battlezone was the first successful mass-market game (around 15,000 copies then which was a lot for that time!) featuring a first-person viewpoint and wireframe 3D graphics, with a version later released for home computers in 1983. Other games which resembled FPS games were Midway’s Wizard of Wor and Taito’s Gun Buster. The latter especially was interesting as you used a joystick for movement along with a light gun to shoot and aim. You could even network several cabinets together for a multiplayer deathmatch.

Battlezone (Courtesy Atari, Inc.)

This era saw the rise of ‘home gaming’, with the advent of home computers and consoles. The fact that players no longer had a ‘timer’ on their game brought a lot of leeway when it came to designing games for the personal gaming market. More immersive and inventive approaches started taking off, even within the limited scope of FPS games. This was precipitated by Atari releasing a line of personal computers like the ST, STE, TT, and Falcon, with an increasing number of games being made for them. The first true PC FPS was Hybrid Arts’ Midi Maze, made for the Atari SD and released in 1987. Players became a Pac-Man-like orb in the game and were tossed into a maze where they could move around in whatever direction they wanted while shooting lethal bubbles at other similar-looking enemies. The key features of Midi Maze which made it fun were two things:

  • Its networking capability: you could have as many as sixteen players in the same maze (although it was usually really laggy).
  • Users could create their own mazes using an uncomplicated text editor.
Midi Maze (Courtesy Hybrid Arts)

FPS trends during this era:
– The first FPS games involved basic tile-based movement where players could only move from one tile to another and turn in 90-degree increments.

– These early games were usually either grid-based or ray-casted, with games like Wayout using ray-casting technology to render the environment and wall segments relative to the player’s position and the angles they’re facing. 

–  One of the first-ever LAN games was MIDI Maze but it would take some time to cement the concept even though its multiplayer mode acquired a cult following.

The real transformation of the FPS subgenre came in the 90s though.

The Early 90s

You may have heard of a company called id Software. They arguably pioneered the FPS subgenre and gave it a lot of its key traits. John Carmack, their resident genius, made innovations that transformed the gaming industry as a whole. He figured out how to render 3D images as fast as 2D ones and created the concept of ray casting where the PC would draw only what the gamer could see rather than create the entire in-game world, making rendering speeds significantly faster.

Their first release was Wolfenstein 3D, the progenitor of all 3D shooters, where you play as William “B.J.” Blazkowicz,  a gruff, shotgun-toting Jewish-American spy with a penchant for Nazi-killing. He was gaming’s equivalent to John Rambo, the quintessential one-man army – a trope that exists to date. The game forced players to stay constantly alert for enemies and the pace of the game was faster than any other game around at the time. It was a massive hit and basically ushered in an era for FPS games focussing on break-neck pace while also laying the groundwork for things like intricate level design and weapon functions which are now considered the industry standard.

Wolfenstein 3D (Courtesy Atari Corporation)

After the resounding success of Wolfenstein, id wanted to make something even more phenomenal, something faster, bloodier, and scarier. They had the technology: with John Carmack’s revolutionary engine, they could have different levels of light and illuminations, render surface textures, and create variable-altitude floors and ceilings. Thus was born Doom, the game which single-handedly transformed FPS gaming. The anticipation for the game was unprecedented. So many users were accessing the first FTP server where id Software planned to upload the game that they were unable to connect to it, forcing the administrators to kick all other users off to allow id to upload the game. When the upload finished thirty minutes later, 10,000 people attempted to download the game at once, crashing the network.

Doom (Courtesy id Software, Inc)

In Doom, you play as a space marine who endlessly fights with demonic enemies, each of whom has unique behavior and abilities. It had a visceral, fast, and loud soundtrack which made the game feel even more intense. Doom was not just a game, it was an experience. Nothing like it had ever been seen before and ‘Doom addiction’ got so bad that within hours of Doom’s release, work and university networks were banning Doom multiplayer games, as the massive number of players overwhelmed their systems.

id was happy to license their engine to other companies and a bunch of Doom clones began popping up, such as Raven Software’s Heretic, Rogue’s Strife, and notably, Bungie’s Pathways into Darkness. The latter melded Wolfenstein’s fast-paced shooting with running in a maze, along with an inventory system. The company’s next release allowed you to use two weapons, plus voice chat with fellow Marathoners over LAN. System Shock was a game that was also notable because it incorporated a more compelling narrative along with deeper immersion.

FPS trends during this era:
Wolfenstein 3D is credited with inventing FPS games as we know them and creating a shooter game design template on which games are being based to date.

– The fast-paced gameplay in Doom, along with its music, created one of the most immersive games made at the time, to the extent of causing several clones based on Doom to be released.

– The concept of deathmatches (competitive matches between several players) was further developed in Doom, building upon the work done in earlier releases like MIDI Maze, and was the first achievement of multiplayer on a large scale.

Doom also had really good graphics for the time, with variable-height floors and ceilings and even rudimentary lighting effects which found their way into several games going forward.

The Late 90s

Before we head into id’s next revolutionary release, a game to note was Duke Nukem 3D, because it was the first FPS that won acclaim for its highly-interactive environments, adrenaline-filled gameplay, and the way it made the protagonist a star, with Duke being voiced to sprout wise-cracks as he fought aliens. 

Back at id though, John Carmack was hard at work. Computers at the time couldn’t render 3D game environments and players at the same time. Their next innovation, Quake, had a game engine that was nothing short of revolutionary – Carmack had found a way to render fully 3D maps, enemies, and power-ups with zero limitations regarding angles or surface heights/lengths. id had also hired Trent Reznor of Nine Inch Nails fame to compose the music for Quake. It pioneered unique and innovative movement options for the player with bunny hopping or strafe jumping, letting players move faster, as well as the new mechanic of ‘rocket jumping’, where players used the reaction force from explosive weapons to launch themselves higher. It was a massive hit. Quake also had various multiplayer options including Online Multiplayer after the QuakeWorld update. Multiplayer Quake could be considered one of the first massive competitive games and a precursor to modern-day esports.

Quake (Courtesy Bethesda Softworks LLC)
Quake (Courtesy Bethesda Softworks LLC)

Competitive multiplayer gaming became huge: with the improvement of internet infrastructure, online gaming was getting more popular. Epic’s 1999 release of Unreal Tournament was one of the first purely-multiplayer FPS games. There was a single-player mode where people could train against bots but the core of the game was online and LAN play. id released Quake III: Arena a few months later that year. It was a multiplayer FPS as well and focused on open arenas and quick movement as key mechanics.

Two more games that changed the nature of FPS games are Rainbow Six and Counter-Strike. They might not have been the first of their kind but they are the most well-regarded and culturally prevalent examples. The former is notable because it was one of the first shooters to focus on tactics reminiscent of real-life police/SWAT officers and Special Forces. It put the player in the shoes and the mental space of these specialists, and needed you to calculate your resources, plan your attack, and clinically neutralise enemies (or risk meeting a swift end). It eschewed the fast run-and-gun mechanics of Doom and Quake. Counter-Strike, originally released in 1999 as a mod for Half-Life (which we’ll talk about next), was one of the first popular objective-focused, multiplayer FPS games where there was no respawn mechanic mid-round. This meant that every play, every decision made by you and your teammates mattered more. This focus on teamwork and efficiency is why it was one of the first FPS mainstream tactical esport titles, and why it belongs in the pantheon of all-time great video games.

Tom Clancy's Rainbow Six (Courtesy Ubisoft)
Tom Clancy's Rainbow Six (Courtesy Ubisoft)

Most of the core mechanics of the FPS genre were established around now, with future games focusing on improving upon these mechanics, making games more immersive, and tailoring better user experiences. An example of this would be Valve’s Half-Life, released in 1998. You played Gordon Freeman, an unassuming physicist who has to escape a lab teeming with hostile aliens. The game puts you in a smooth and seamless world, with the story conveyed through the characters and the environment, eschewing cutscenes. The rich, linear-but-curated player experience it provided created a new niche for FPS games.

Half Life (Courtesy Valve Corporation)

Next came System Shock 2, where you not only gunned down your enemies with abilities and weapons alike but also questioned who exactly they were in a morally grey world. The System Shock series eventually inspired the modern Bioshock series. One more important game in this era is the 1997 release of Rare’s GoldenEye 007. It was one of the best games made exclusively for Nintendo Consoles. It proved that FPS games could work on consoles as well and lots of aspects of its game design such as controls and modes are considered fundamental building blocks to future console and PC FPS releases.

FPS trends during this era:

Duke Nukem and its sequels won acclaim for their interactive environments and a huge buff to movement freedom with the protagonist being able to fly with a jetpack. It also was noted for the titular character itself who was programmed to have a funny personality that appealed to players. 

Quake was the first FPS to feature 100% 3-dimensional maps, enemies, and powerups with no limitations on angles or surface lengths.

Quake also focused on online gaming and pioneered different types of game modes that are used in FPS games to date.

–  LAN parties became a mainstay of gaming culture, and events such as QuakeCon — where players came to fight it out and prove they were the best — were pioneered by Quake.

– Tactical FPS games, which were more cerebral than Quake and also didn’t have player respawns, started gaining popularity. Case in point: Counter-Strike.

– Several advancements in video-game storytelling were pioneered in games like Half-Life, using environments and an intricately designed linear player experience, creating a new niche of narrative-based FPS games.


Half-Life cemented the popularity of FPS games that focused on a deep narrative along with game mechanics. A lot of the games released during the early 2000s were of this type and they usually ran on either the Quake III engine or the Unreal Engine. Some of these include Medal of Honor: Allied Assault and of course, Call of Duty. The latter game, released in 2003, received critical acclaim and won several Game of the Year Awards. Its increased emphasis on team-based gameplay as opposed to mere single-player combat made it a pioneer. In particular, 2007’s Call of Duty 4: Modern Warfare was a resounding success. This was a result of its strong storyline which showed the gaming world a realistic portrayal of war ripped straight from newspaper headlines. Its graphics were leaps and bounds ahead of its rivals, you used modern weaponry (not just guns, mind you), in true-to-life scenarios, and it struck the right emotional chords. Initial titles were known for their realism but the newer releases of the game focus on futuristic movement abilities for soldiers. The series is just as popular though, if not more so.

In 2001, Halo: Combat Evolved was released on the Xbox and received tremendous acclaim for its characters, narrative/worldbuilding, and in-game dialogue. This was a game that pioneered the release of future FPS multiplayer games for consoles and had to change features to make the game fun for the controller. Changes included players only being able to carry around two weapons to make switching between them with just one button viable, and automatic saves at certain locations or plot points (called ‘checkpoints’ — this term became a very popular descriptor for similar mechanics). Another introduction was that of “regenerating shields/health”, a game-changing mechanic that players adored and one that became commonplace in modern FPS games, which let players fall back from combat and heal up a bit. Halo helped standardise a lot of mechanics that modern gamers take for granted, and was a milestone for both FPS games and console shooters as a whole.

Halo: Combat Evolved
Halo: Combat Evolved (Courtesy Xbox Game Studios)

Complex multiplayer games like Battlefield and Call Of Duty, apart from just standard firearm-based combat, also introduced aspects like tanks and planes which added an element of realism for the players and helped better represent the various aspects of warfare and the historical timeframe in which these games were set. 

The next development was the release of Far Cry in 2004, which popularised open-world designs and increased environmental detail and graphic quality. Far Cry 2 took this to even more realistic levels, where the open world was almost alive and responded to player behaviour- players could get ill or injured, wildfires spread as they did in nature, and the enemy AI was quite realistic. Doom 3 came out a few months later and was a bestseller. It too focused on innovative graphic effects and advanced lighting to make the game even scarier. Half-Life 2 won 39 Game of the Year awards and consisted of similar high-quality graphics, lighting, and shading effects.

Far Cry (Courtesy Ubisoft Entertainment S.A.)

Halo 2 was released in 2004 as well and with the improvements in internet infrastructure, it made online multiplayer gaming extremely popular on consoles through Xbox Live. Several new games were released in the next few years, all heavily influenced by Halo and its mechanics and features. Halo pioneered redesigned menus, simplified console controls, and mechanics like switching quickly between 2 weapons, checkpoints, and automatically regenerating health. Most new console FPS games have been released with these features as well.

FPS trends during this era:

Halo made console FPS games mainstream and came up with the features and mechanics which made FPS games fun and viable to play on consoles. It redesigned menus and simplified controls. The mechanics from Halo are in use to date.

– The Call of Duty games increased emphasis on team-based gameplay as opposed to mere single-player combat caused a massive surge in multiplayer FPS games’ popularity. Its realistic single-player campaign was a huge success as a result of its realistic portrayal of war.

– Co-op games where you could enjoy slaying zombies with your friends like Left 4 Dead were really popular. FPS games that told a great story also gained traction. While not exactly an FPS, Portal was a great example of a game where you used your non-lethal portal-creating gun (also called the Aperture Science Handheld Portal Device) to solve puzzles in a bid to escape a laboratory.


Post the 2000s, several new kinds of games began popping up. The first of these was Looter Shooters, which became famous for their inclusion of procedurally-generated, ever-changing, ever-improving weapons and other loot such as armour or weapon parts. These games ensured extremely fast gunplay and led players to develop a grind-focused mindset. They combine long-term character growth and the satisfaction of upgrading your gear along with intense high-adrenaline shooter gameplay. These games not only involve killing your enemies but also rewarding players with better loot and abilities, which wasn’t the case in the ol’ Halo and Call of Duty days. In 2007, Hellgate: London (not a pure FPS but it could be played in both third and first person) was released and while it received mixed reviews, it showed the gaming community how rewarding getting good in-game loot could be.

In 2009, Borderlands was released and they had everything nailed down. Whether it was the standout cel-shaded art, amazingly fun music, great shooter mechanics, and of course, the wacky fun loot available, it was the first successful looter-shooter and paved the way for the genre. Borderlands 2, released in 2012, was the game to perfect this subgenre and received universal acclaim for everything: the loot, shooter mechanics, the funny and enrapturing story, and phenomenal visual design.

Borderlands (Courtesy 2K Games, Inc.)
Borderlands (Courtesy 2K Games, Inc.)

Apart from the Borderlands series, another iconic looter shooter is Warframe. The game’s release was rather unremarkable but its continual release of new content expansions has kept it popular to date. Warframe was one of the first truly successful “games as a service” or GaaS shooter titles and paved the way for one of the most popular online shooters of all time – Destiny – made by the same folks who made Halo. GaaS games allow developers to constantly update the in-game content, so the players can get more out of it.

Destiny was also a GaaS release and was an online multiplayer FPS title. It had features such as Clans, which you could be a part of and participate in raids, strikes, and other timed events, as well as centralised hubs where you could meet other players to become friends. All these features were trademarks of MMO/MMORPG games which FPS games successfully incorporated. Destiny was a pioneer for purely online multiplayer FPS games and GaaS titles. They also consistently released expansions based on player feedback and created content they loved. However, it didn’t get any significant improvements till Destiny 2 was released in 2017. It was known to respond quickly to community feedback regarding game balance, combat, and other aspects.

Another subgenre of FPS games that gained great popularity during this time period was the Hero Shooter, which is a variation of multiplayer shooters where players choose from pre-designed “hero” characters that possess unique attributes, skills, weapons, and other activated abilities, to form two or more teams (this feature was borrowed from MOBAs). This type of game also strongly encourages teamwork between players on a team, from selecting effective combinations of hero characters to coordinating the use of hero abilities during a match. Because of the focus on heroes as distinctive characters, this sort of game will often provide backstories for each character as well as the world(s) the game is set in, and tend to have distinctive character design. Players often choose to play a certain hero simply because they find their character and design appealing. While Valve’s Team Fortress 2 is often considered the first good example of a stepping stone between role-based shooters and a proper hero shooter, the subgenre didn’t achieve mainstream popularity until the release of  2014’s Overwatch. While the former was the first game to call itself a hero shooter, Overwatch was a resounding success. It assigns players into two teams of six, with each player selecting from a large roster of heroes, each with unique abilities. Teams work to complete map-specific objectives within a limited period of time.

Overwatch (Courtesy Activision Blizzard)
Overwatch (Courtesy Activision Blizzard)

Other hero shooters which follow the key tenets of the subgenre and are extremely popular include Rainbow Six: Siege, Apex Legends, and Valorant. These games also focused on franchising and driving their esports scenes forward with both regional and international tournaments. They also released regular game-balancing patches, new agents and maps, and patch updates to ensure players’ concerns were being addressed. Communication between the game’s players and developers increased significantly with a key reason for this being social media. Some other key features of hero shooters include separate game modes for practice, casual play, and competitive ranked play. A lot of these games are also often free-to-play, with their revenue coming in through sales of cosmetic items such as weapons and hero skins. These do not affect gameplay but can make the game feel more personalised.

The Battle Royale sub-genre also deserves a mention here. It blends last-person-standing gameplay into online multiplayer games. They involve a dozen to even hundreds of players who start with minimal or even no equipment and have to scavenge for gear while eliminating other opponents. To ensure players keep encountering each other, the play area continuously shrinks. The winner is the last player/team who remains alive. The subgenre started off as mods for Minecraft but gained popularity with games like H1Z1 and DayZ. It became a phenomenon with the release of PUBG: Battlegrounds. It was a huge hit because of several reasons. The games were quick and addictive and there were several ways to win. You could try and kill everyone or sneak in on people already fighting and take them down. The thrill of finding and looting gear was part of PUBG’s success. It also appealed to those with the competitor instinct: the idea of being the last person standing amidst a hundred people sounded great to them. The fairness aspect comes into play as well, with players starting with the same gear. However, the randomness faced while finding loot makes it truly egalitarian. Other FPS titles which are successful battle royale games include 2017’s Apex Legends and 2020’s Call of Duty: Warzone

Playerunknown's Battlegrounds (Courtesy KRAFTON)
Playerunknown's Battlegrounds (Courtesy KRAFTON)

Finally, FPS games are extremely popular in the competitive world of esports and online gaming. They saw an uptick in popularity when LAN networks, and later the Internet, opened up multiplayer gaming and made it a social phenomenon. Since the early 2000s, internet capabilities have exploded and computer processor technology has improved at an extremely fast rate. 3.2 billion people across the globe have access to the Internet and at least 1.5 billion people with the Internet have access to and play video games. You can also read about how esports has exploded in popularity in our previous blog.


FPS trends during this era:
– Games became increasingly mixed when it came to the FPS subgenres like looter shooters, hero shooters, and battle royale games gained massive followings.

– The GaaS revenue model became popular, with more and more games being free to play and gaining revenue from in-game merchandise.

– Online multiplayer FPS games have seen massive investments when it comes to esports with both local and national events often being organised by game publishers.

–  Streaming FPS gameplay and live tournaments have become a legitimate living and have further popularised online gaming culture.

– Other popular FPSes which have to be mentioned for their popularity and/or achievements include Day-Z, Titanfall 2 (a cult classic), Bioshock Infinite (a watershed moment for narrative FPS), Portal 2 (one of the most successful puzzle FPS games), Superhot, and Bulletstorm.

– Releasing new content, patches for balancing the game, and growing an interactive community was done successfully by Destiny, and other games are following suit.

How have FPS Games Evolved, and Where are they Heading?

FPS games have become a staple subgenre of games and for good reason. There are several reasons one might like playing them, ranging from wanting to shoot guns, playing with your friends, or slipping into a flow state and hitting your shots. The number of FPS games being released is steadily increasing and more than that, famous franchises like Halo, Call of Duty, or even the latest Quake game, Quake Champions, have no shortage of takers.

FPS games have steadily evolved over the decades and an increase in their complexity has gone hand-in-hand with the availability of better technonlogy. Early FPS games were made for systems with no graphic cards or drives- the concept barely existed then- and with low processing power. Graphics did get better over time and various improvements were made in the 70s and 80s, but in 1999, Nvidia released the first ‘real GPU’, the GeForce 256 which was the first in a long line of path-breaking GPUs to come. If you’re interested in looking at the evolution of graphics, this might help.

As innovations in both hardware and software came through, the mechanics, as well as the graphics of FPS games, have become increasingly complex. A great example of this was the fast inverse square root algorithm, most popularly used in Quake III Arena, which was one of the first FPS games to heavily use 3D graphics. This enables the computer to compute lighting and shading angles extremely fast and thus reduce the render time. 

Further innovations such as the usage of AI in games have made the genre even more versatile. Several games use AI-powered bots to help players practise and improve their aim. In fact, one of the first FPS games to use clever AI is still remembered for it: Monolith Production’s 2005 F.E.A.R (First Encounter Assault Recon.) What makes it unique from other FPS games at the time is the AI opposing the player, which makes decisions quickly and accounts for the most minor player actions. For example, in the game, if a player takes cover behind a barricade, the enemy AI quickly processes this action and throws a grenade to eliminate the player. To be fair, in the past several years, several FPS games have shifted their focus to multiplayer (single-player campaigns are still going strong though). This has caused AIs being used to be fairly simple and used more for training than anything else. 

With significant improvements in graphics coming every few years, whether it is more powerful graphic cards or better code, FPS games are looking increasingly polished. In fact, more and more strong narrative-focused FPS games are being released, mostly single-player, where a key selling point is the strength of the graphics. Games like Halo Infinite, Metro Exodus, and the Far Cry series are all examples of games that were resoundingly successful because of their brilliant characters, touching stories, and of course, gorgeous graphics.

FPS tend to mix mechanics to capture their audiences’ attention. A lot of initial games were run-n-gun shooters for instance. Another example of FPS games having multiple sub-genres is Apex Legends. While it is primarily an FPS game, it also falls under the categories of Hero Shooter and Battle Royale. Valorant is an FPS but is also a Hero Shooter and relies more on team coordination and tactical gameplay. Both of these games are also free to play, which is a trend we’re seeing games increasingly follow as they release as GaaS, opting to make their revenue off microtransactions and in-app purchases.

Apex Legends
Apex Legends (Courtesy Electronic Arts)

As for FPS games in the future, that’s going to depend on the innovations being made technologically. VR shooter games seem like they hold a great deal of potential. Half-Life Alyx’s immersive weapon handling, where your guns are assigned to one hand, lets you feel like you’re actually holding them. You’ll also be jumping in and out of cover when you’re in combat which encourages you to fully use your body and have an unprecedented and unique experience. Other innovations such as cloud gaming can help with playing single-person shooters which focus on narrative: they can render detailed and beautiful graphic worlds without players having to worry about buying expensive gaming hardware.

half life alyx vr
Half Life: Alyx (Courtesy Valve Corporation)

To sum up, the first-person shooter is a genre that seems like it’ll never go out of style- and with good reason. Even as mechanics and gameplay features have slowly stabilised, the scope for combining them with other genres and mechanics has increased. Modern FPS games are arguably the most diverse subgenre, they range from hyper-violent run-n-gun games like Doom: Eternal to tactical hero shooters like Valorant, and everything in between. The varying core motivations to enjoy playing them remain the same though.

We at Gameopedia specialise in collecting and curating the latest and best data and information about games. We work with clients across the industry on custom requests and can provide in-depth data on any subject related to FPS games. Reach out to us to get access to data that can empower you to new heights.

Featured image credits: Halo: Combat Evolved (Courtesy Xbox Game Studios)

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The Rise of Esports, How Data Drives It, and What the Future Looks Like

Electronic sports, or esports is the evolution of online competitive gaming into spectator sports. It started off as a niche industry but over the last decade, it has become a major player in the sports and entertainment industry, and even become a part of mainstream culture. Viewers can watch video gamers compete against one another in a virtual environment just like how they’d watch a professional sports event. In 2021, the global esports market was valued at just over $1.08 billion, an almost 50 percent increase from the previous year. 

The first-ever esports competition took place at Stanford University in 1972. Five students competed in an “Intergalactic Spacewar Olympics,” and the winner received a year’s subscription for Rolling Stone. Dota 2’s The International 2019 invited the top players in the world to a tournament with a crowdfunded prize pool of $34.3 million. Less than a year before that tournament, CNBC reported that the “League of Legends” World Championship finals in South Korea hit nearly 100 million unique viewers, eclipsing the previous year’s Super Bowl, one of the most popular sports championships which had just over 98 million viewers. 

esports arena
Esports arenas can get as jampacked as traditional sports stadiums these days.

Esports has only grown bigger with the 2020 Covid-19 pandemic. With people being confined to their home and the usual sports tournaments not happening, they turned to virtual game tournaments increasingly for entertainment. Across European countries, 38 percent to 67 percent of esports consumers stated that they watched esports for the first time after COVID-19 related restrictions were imposed.

The potential to earn from gaming has become increasingly tantalising as there are several ways to do so. Most obvious is the prize money from tournaments, but esports athletes can also make millions of dollars from streaming their live gameplay, signing contracts with big organisations like TSM, 100 Thieves, Team Liquid, and the like, engaging on social media, and sponsorship deals with entities both within and outside the gaming sphere such as Redbull, Corsair, and AimLabs. Everyone can benefit from esports- the players, the audiences, and corporations. 


The esports ecosystem supports itself and thus thrives.

Several technology, analytics, and service platforms are also beneficiaries of this ecosystem as it continues to grow in leaps and bounds from increasingly substantial investor capital. The largest sponsorship deal to date was TSM receiving $210m over 10 years from crypto exchange FTX.

The Esports Industry: Who is Involved?

Esports involve several parties who make the ecosystem thrive. These include:

They develop their skills through extensive, competitive play. They train for quick reflexes and multi-tasking abilities, often for several hours a day. Those who rise to the professional level compete in tournaments all around the world against the best teams. They gain a fanbase for the teams and organizations they play for as well as themselves as they grow. Retired esports professionals may opt to stream themselves, coach esports teams, start their own team, work for publishers, and more. Some of the most skillful and consistent players often end up being the face of the game, such as Faker in League of Legends.

Faker- one of the most talented League of Legends players- makes a cameo in almost every video they release to hype up their annual championship.

Gamers who livestream themselves as they play video games are referred to as “streamers.” This is typically done in casual play but professional players also stream their ranked games or do analysis of their gameplay to educate and entertain their viewers. While streaming can be incredibly profitable, many streamers have to decide whether they want to stream for a living or try and play professionally and run the risk of making less money. With that said, not all streamers have the skill to play professionally. Instead, some simply have “streaming personalities” that viewers find entertaining to follow, donate to, and subscribe to. Some examples of these are Ninja, Valkyrie, Pokimane, and PewdiePie, who all have several million subscribers on platforms like Twitch and YouTube.

Ninja is one of the biggest streamers on Twitch who makes millions of dollars annually from streaming alone.

A great example of how much streamers make just off streaming platforms is Ninja. Ninja, or Tyler Richard Blevins, is a professional gamer who became a global phenomenon in 2017 as a result of his Fortnite streams. Ninja had more than 17 million followers on Twitch by the end of November 2019, making him the most followed Twitch streamer by a long shot. He’s best known for streaming Halo Infinite, Fortnite, and Halo 3. His estimated revenue from just streaming is about $25 million, though his income is far more than that considering the many sponsorships and partnership deals he’s signed.

When you think about esports, depending on the game, several teams come to mind. If you follow CS:GO for example, Astralis and NaVi are names you’ll definitely know. When it comes to VALORANT, teams like Team Liquid, Cloud 9, Sentinels, and the like are known by those who follow the competitive scene. Traditional sports teams and athletes alike have also taken an interest in esports, with Shaquille O’Neal’s co-ownership of NRG Esports and FC Barcelona’s Rocket League and eFootballPES 2020 teams.

All of these teams are usually funded by large organisations and tend to specialise and compete in one specific game, such as League of Legends, Dota 2, or Counter-Strike. Note that organisations can often have several teams, each for a particular game. The teams that compete at these tournaments often have millions of followers on Twitter, millions watching online, and tens of thousands of spectators following them to in-person tournaments. 

Team Liquid's Valorant roster is one of the game's most popular and talented teams.

The best esports teams are recruited to be a part of organizations and have several teams that specialize in their respective video games but operate under the same name. Examples of these include Cloud9, NRG, TSM, Optic Gaming, and Fnatic.

Some of the major esports organisations: well-established ones and upcomers alike.

Leagues and Tournaments:
Esports teams which can be free agent teams or representing an organisation compete in leagues which have regular seasons and championship events, often international. A great example of this, which has remained popular for over a decade is the League Championship Series or LCS for League of Legends.

These are the people who build and develop their games and subsequently own all rights surrounding them. This means that they have rights around where the game is played, who can host video game tournaments, and more. Examples include Valve who owns CS:GO and Riot Games who own League of Legends and VALORANT.

Other Important Entities:
These are essential to the esports industry and also benefit from it. They can be divided into:

  • Platforms and Infrastructure: These include tournament platforms like Battlefy and communication tools such as TeamSpeak and Discord which make esports easier to plan and perform in.
  • Livestreaming Resources: These are live streaming platforms which include highlights, old VODs, and analytics which can be monetised by streamers. In particular, Twitch is one of the most popular streaming sites for esports. It was acquired by Amazon in 2014 for $970 million and reached close to 5 billion total hours streamed in 2016.
  • Betting and Item Marketplaces: Esports gambling, fantasy leagues (with pro-esports athletes), and item marketplaces for in-game customization have grown significantly in the last several years. Recently marketplaces have also started selling NFTs-  a good example of a marketplace which does sells skins, game items, as well as NFTS is dMarket.
  • Aspiring Pro Gamer and Fan Resources: This could be everything ranging from news sources, industry statistics tracking, coaching, and skill improvement tools for professional and casual players. Websites like Game Rant and PC Gamer help keep people up to date with the latest gaming industry news. Sites like metafy.gg offer coaching sessions from top professionals in the game to those wanting to improve. 

Data in Esports:

Like any other industry, data can be used to significantly enrich and improve esports by helping with developing applications and systems which can benefit the gaming ecosystem. Data is vital to every aspect of the esports ecosystem. Whether it happens to be streaming analytics, player statistics, or other tools and platforms, esports can’t function without data. Data directly economically benefits the market and helps its growth. Some of the ways it does so includes:

Statistics tracking for players: 
There are multiple platforms online, free and paid, that allow players to know details of their favourite games, which were traditionally quite difficult to gather and visualize. They can help players make better decisions by understanding their mistakes, see their performance trends over time, and see where they stand compared to other players or even professionals. 

blitz.gg gives you statistics for Valorant such as headshot %, win rate, and your top agents.

These tools work similarly to typical digital dashboards that you can find in the day-to-day operation of any leading company performing basic business intelligence. Data is obtained from one or more sources (in this case from all video game servers) and through the use of a series of data processing and model development mechanisms, visualisations are generated in order to retrieve insights for better decision-making in the next games. The result is that players can improve their performance which in turn benefits the competitive scene and generates more hype.

For audiences:
Data visualisation has become key to enhancing viewer experience during live broadcasts as it allows inexperienced participants to follow the game.  

Visualise all kinds of data in-game such as brackets, statistics, and gameplay.

Data is shown on the screen in different tables and graphics during the broadcast, and it is possible to observe in real-time how the most relevant metrics fluctuate during competitive matches. You can also do an analysis and breakdown of good plays from a particular match which can help all viewers understand the game better.

Tournament schedules and information:
This data can help keep track of tournaments happening, the teams and players participating in them, prize pools, dates for matches, registration details, and past events, among others. 

Websites like vlr.gg let you keep track of tournament matches, players participating, schedules, and previous matchups among other things.

The bot system:
Bots are simple forms of AI that simulate the movements and actions of a human player. These virtual players are used to help new players to get up to speed with the mechanics of the game before facing other more experienced players or as a warm-up or practicing tool for more experienced players.

Bots in the practice range can help improve your aim significantly.

The reporting system:
This is a tool that penalizes players for cheating, toxicity, and other actions which negatively impact a game based on historical in-game data collected. If a player receives a high number of reports from others, or the system counts several leaves from the game, they will be automatically banned from the system and prevented from being able to play for some time. ML models are applied which will increase this “punishment time” if the player persists with their bad behaviour.

ML reporting systems help keep the toxicity levels of communities low.

Revenue in Esports

Revenue in esports flow through various channels. The most well-known is revenue related to leagues and tournaments such as prize money and entry fees. Other revenue streams include:

  • Franchising:
    In franchised leagues, the franchiser- in this case, the game publisher- offers a select number of available spots. Each spot in a league comes with a certain price tag. After buying into a franchised league, a franchisee will earn the perks of being a permanent member. Following a regular season of match-ups, points are tallied up to generate a bracket for a final post-season battle to determine the champion. Activision Blizzard started the Overwatch League in 2018, after selling 12 franchise slots in 2017 heading into the inaugural season — with franchise fees reported to be $20 million. Riot Games sold 10 franchise slots for its North American League of Legends Championship Series in 2017 for $10 million to existing teams and $13 million for new teams.
  • Media and broadcasting rights:
    Broadcast media rights have become a major part of revenue generation for major esports leagues and titles as they look to create a sustainable ecosystem and revenue model that will provide a substantial return on their investment. Before Activision Blizzard’s franchise Overwatch League started, Twitch reportedly paid $90 million to stream the first two seasons of the league.
The streaming rights of the inaugural season of the Overwatch League were bought by Twitch for $90 million.
  • Advertising:
    Marketers are hoping to reach the throngs of fans who like to tune in live as professional gamers battle each other in their favorite game, be it League of Legends, Overwatch or others. In 2019, 30.3 million people in the United States will watch an esports event at least once a month, a more than 18 percent increase over last year. Esports digital advertising in the United States generated a revenue of $175 million in 2019. What is more, the figure is expected to further grow and reach $226 million by 2021.
  • Sponsorships:
    In 2019, out of the total esports revenue of $1.1 billion, sponsorships contributed $667 million in revenue, which was the largest chunk. Revenue from esports sponsorship is estimated to reach almost $600 million globally by 2023. ESL’s ongoing 20-year partnership with Intel was renewed again. Commencing in 2022, both entities have committed to investing $100 million in esports between 2022-2025.
  • Tickets:
    At just over $100 million in revenue in 2018, ticket sales don’t occupy the same role that they do in traditional sports, especially after the pandemic when virtual and free broadcasting of tournaments gained traction.
  • Merchandising and partnerships:
    Beyond tickets, esports organizations and streamers have made a business of selling merchandise such as t-shirts, jerseys, and even special editions of gaming peripherals. Logitech introduced the new PRO Series Shroud Edition, a suite of Logitech G’s most advanced gaming peripherals they launched in collaboration with Michael “shroud” Grzesiek who is one of the most beloved streamers who is known for his excellent aim. Shroud’s extensive fanbase would definitely be among those who would be interested in these peripherals.
Shroud and Logitech G launched a series of gaming peripherals in collaboration with each other.

The Future

The esports industry’s global market revenue was forecast to grow to as much as $1.62 billion by 2024. Some of the trends we are already seeing and can look forward to include:

Growth of mobile esports:
Mobile phones are becoming increasingly cheaper and technologically advanced. Mobile games have some of the lowest barriers of entry when it comes to gaming and this has captured millions of esports fans around the globe. Most people have smartphones, and mobile games typically have low hardware requirements, helping mobile esports flourish. In 2020, the global mobile gaming content market was worth $121.1 billion and is projected to reach $169.7 billion in 2025 with Asia generating the most revenues in the segment.  As of August 2021, there were 5.3 billion mobile gamers around the world, with Asia accounting for over 1.29 billion mobile gaming users– more than 48 percent of the global mobile gaming audience.

The access to good quality internet has also significantly increased over the last years and has made mobile esports play more stable and viable. With over $21.9 billion in gross revenues, RPG games were the top mobile gaming app genre worldwide in 2020, growing 19 percent compared to the previous year. Strategy apps were ranked second with a global gross revenue of $15.1 billion during the measured period.

Free Fire and PUBG Mobile are among the battle royale genres’ most popular games available on mobile. It’s no coincidence that these titles are extremely popular in emerging markets and the esports scene for these games is worth several million dollars. PUBG Mobile’s clone, BGMI, has proved extremely popular in India. Four months after the release of the game, BGMI has acquired $7 million via in-app spending. The title has been downloaded over 50 million times on the Google Play Store.

Blockchain and NFTs:
Teams and organisations are trying to find ways to directly monetise their fanbase and are looking at blockchain technology and NFTs to achieve this goal. Esports fans are already used to buying digital goods such as skins, in-game currencies, and the like, and are also more accepting of new technology. Unlike normal NFTs, esport NFTs focus on innovating loyalty amidst their fanbase by creating exclusivity. Fans can earn digital rewards on the blockchain when they engage with an organization’s content or buy NFT artwork of the team or players. These are tradable and can increase in value over time. Initial exclusive fan tokens can also make raising investments easier for esports organisations. In July 2021, European esports juggernaut OG Esports revealed that it was going to enter the NFT fray and the organization was able to rake in a cool $1 million via the sale of just three digital artwork collections, putting them just behind Team Liquid on the esports earnings leaderboard.

Esports betting:
The digital nature of esports puts it in a unique position in the betting space. Every in-game action and movement can be captured as data points from the game’s servers. The global esports betting market size is expected to reach $13.05 billion by 2025, from $7983.2 million in 2019. The number of esports events one can bet on is also growing exponentially, from 3,000 events available in July 2019 to over 50,000 events in July 2020.

The main problem with esports betting when compared to normal sports betting is latency. To be able to create a real-time betting experience, real-time data directly from the server is essential. If someone offers odds or streams faster than the esports video feeds, it could lead to the entire system collapsing. Another big issue the industry faces is integrity. Some betting providers haven’t sought the best gambling licenses and others have been banned by governments in different countries.

Integration of esports into education:
Several universities around the world have realized that esports is a viable career option and have started offering degrees which specialise in the field. Some of these include:

  • The University of Portsmouth offers an Esports Coaching & Performance degree and has partnered with the International Federation of Esports Coaches in order to train the next generation of esports coaches.
  • The Confetti Institute of Creative Technologies, part of Nottingham Trent University, offers a BSc (Hons) degree in esports production.
  • Shenandoah University offers a Bachelor of Business Administration Concentration in Esports Management which prepares you to be a leader in the field of esports management by providing a robust business background with a focus on the business of esports. 

There are also scholarships available for esports players. Recently, the Ontario Government launched a $1m CAD scholarship program for students enrolled in esports and other industry-related programmes.

Esport organisations sponsoring technology platforms:
Another way esports organisations have found to bolster their revenue and also gain better metrics about how their players are performing are the acquisition of technology companies working with esports data. A good example of this is TSM, whose parent company Swift Media Entertainment acquired esports coaching and analytics company Blitz. Similarly, T1 invested in the esports analytics startup Mobalytics in 2020. In addition to acquiring new businesses, Swift Media Entertainment also incubates its own ventures, such as the talent agency ICON.

Content Expansions:
Release of content related to video games in other forms of media can greatly benefit the game and publisher. Riot Games is probably the best at doing this, with their various releases centered around their IPs. 

For their game VALORANT, which was designed to be an esport, they have a year-long group of tournaments called the Champions Tour for which they’re constantly releasing content. Whether its videos featuring individual agents from the game, interviews with professional teams and players, or just really cool music videos which generate hype for the game, Riot does a great job of building interest in the game amidst a wide group of people, including those who might not follow the esports scene.

Another example of using media to generate interest in esports which also sets an example for similar future IPs is Arcane, a show released on Netflix which is based off of characters from League of Legends.

“Arcane” is bringing new fans to the League of Legends IP while also reigniting the passions of its longtime followers, serving a uniquely wide audience and expanding League of Legends’ cultural impact. Riot Games also promoted it in their other games like VALORANT by giving players free in-game items as well as releasing a new weapon skin. They also released skins for characters from the show in Fortnite, another popular game.

Outside of Netflix, the series is also a hit in League of Legends, with champions that feature in the show getting a significant boost in pick rate since Arcane launched. The sisters Vi and Jinx, who take up a substantial amount of Arcane’s screen time, saw a significant uptick in their pick rates.

As you can see, esports is an industry with an almost explosive growth trajectory. Whether you’re a professional player, a team owner, media partner, or casual spectator, the opportunities for success and profit are both numerous and significant. By obtaining and analysing data, you will find it easier to find success in your goals.

At Gameopedia, we work with clients on custom requests and can provide in-depth data on any subject related to gaming and esports. Reach out to us to get access to esports data that can empower you to new heights.

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Gaming The Data To Make Better Games

Data is vital for understanding your users and building products that they’ll love. The most successful organizations and people are data-driven. They’ve figured out a way to leverage data to drive their business and user engagement up. More than that, they’ve done it by creating and adding features to a product or service their users need. For instance, Spotify uses big data to understand the digital music taste of users, developing personalized content for them, and enhancing marketing through targeted ads, Spotify wrapped, and so on. This report from Harvard Business Review shows how data-driven companies use big data to get insights to do things that not only improve their bottom line but also make their customers happy.

Gaming is an industry where this holds just as true. Using data carefully can help you make a game which sells well. It also creates an amazing user experience for your customers and will keep them coming back for future releases. Building a data-driven culture can take your games to a whole new level. 

Let’s take No Man’s Sky as an example of how they went from a rocky launch to a beloved game using gaming data from reviews as well as by looking at how players behaved in game. When No Man’s Sky was announced, its developers wanted to make a game which let players explore a vast, procedurally-generated science fiction universe. The game was developed over three years by a small team at Hello Games and was seen as an ambitious project. The game garnered a lot of attention once announced and the developers made a lot of promises for features such as a multiplayer game mode, cool in-game vehicles, and more. The excitement was almost at a fever pitch as the game’s release date got pushed. Once released, the game proved to be a commercial success initially thanks to pre-orders but the reviews were damning, stalling sales. This was a result of the promised features not being in-game, as well as lack-luster gameplay.

Screenshots of reviews of No Man's Sky: the first is from October 2016, the second from October 2021.

The developers however listened to their users’ opinions and started rolling out new game updates and content which was downloadable for free, slowly redeeming themselves and regaining their audiences’ trust and good opinion. Currently, No Man’s Sky’s user reviews on Steam have changed to “Mostly Positive” after initially being at “Overwhelmingly Negative” at the time of its release. Hello Games could have just chosen to keep the profits from their initial sales and walk away but instead, built a thriving community and game by looking at what their audience wanted from them.

For your game to be data-driven and benefit from being so, you need to use data as a tool throughout the game-development cycle, as well as afterward, when you’re marketing the game or even making sequels. Your gaming data should help you with three things:

  • Understanding what stories your audiences’ behaviors are telling you.
  • Leveraging this information to build a game that sells well and is well received.
  • Make sure you’re using the insights you have to the highest possible level to enhance both game design and business impact.

Leveraging Gaming Data Across the Lifecycle of a Game

You can use different kinds of gaming data to help derive important insights about your audiences and optimize your game across its lifecycle. The key stages, and some important questions you need to ask yourself while working on them, are:

The stages of game development: you can use data to optimize and improve processes in most of these.


In this stage, you need to think about what kind of game to make, what features to include, your budget and resources you can allocate, and do some competitor analysis to see where you stand. Some questions to ask yourself here are:

What genre of game is wanted most in the market? You can look at genre trends over the last few years to gauge which genres are popular among game developers. Before you invest a great deal of money and labor into building your game, you should test out how interested a market or audience might be for a product you want to build. You can use platforms like Splitmetrics to let you test market interest and look at the acquisition funnel, as well as understand what costs you will face while marketing your game. By looking at Google Playstore (for mobile games) or Steam (for PC) you can figure out who the leaders in the market you’ve chosen are- your competition, so as to speak. For example, Oleg Yakubenkov, a mobile game data/product manager, researched the market to see which games thrive on organic traffic and how he could outperform them. He noticed that the racing and simulator niches were getting millions of downloads and there was still room for more. He helped build the Epic Split Truck Simulator which raked in over 2 million downloads in 2019.

Epic Split Truck Simulator, a best-selling game created off of genre research and data.
  • What region do you want to focus on releasing your game? Are you going to make sure cultural nuances are tailored for this? If international, will there be different game editions? Data that can be helpful include how similarly themed or localised versions of games fare in a particular region.
  • How can you monetize your game? Will it be F2P, one-time payment, or subscriptions? What about in-game items and other content? Look at data for the different revenue models and which works best for games like yours. For instance, F2P with in-game purchases works best for mobile games, but for AAA RPGs, it’s better to have a one-time payment.
  • What platforms would you want to release my game on? Will it be compatible with consoles as they come out? Look at data for which platforms are good for the genre you’re planning to release your game in.


In this stage of the game lifecycle, multiple departments consisting of writers, artists, designers, developers, engineers, project leads, and other crucial departments collaborate on the scope of the video game and see what each of them has to do. You can look at the past games you’ve made to get data about the kind of technology and writing you’re capable of and whether it’ll be sufficient for your current project. You can also do competitor analysis for the same. Sentiment analysis can also be a powerful tool here to look at what kind of games your audience likes, as well as understand what game to make, what features to include, and overall, ideate better.

  • Is your development budget sufficient to bring your vision to life? Do you need to hire more people to help with development? You can look at similar projects as a benchmark for how many resources you might need.
  • Do your developers and engineers have the resources necessary to render environments, figure out in-game mechanics, and game physics? Again, you can look at other projects to set a benchmark.
  • Can my artists and designers create visuals and game art that aligns with what was planned in the previous stage? Does the team have enough talent to do so? You can look at previous games to see what kind of art they’re used to creating and if your new game is too far off those constraints.
  • What is the timeline for this game’s development and release? Data can be of help here to model timelines for each stage of the game based on past releases.


This is the stage where most of the time, resources, and effort of your team will be spent. You will be designing and rendering your characters and environment, code all of your in-game content into existence, and ensure your audio design is flawless. You will also make sure your levels and in-game milestones are immersive and fun to play. You will be constantly iterating and improving these things and following sprint schedules. 

Data really doesn’t play as much of a role here as it does in other stages. You need to make sure that the different levels/phases of the game have been completed as per the game design document and that the different teams involved in the project are communicating with each other and working in sync.


This is one of the most important phases of game development and can make or break a game. You want to check every aspect of the game to make sure it plays as intended. Whether it is the accessibility of areas, testing of game mechanics, or even making sure the game is neither too easy nor difficult, game testing is the final place to catch game-breaking issues. When problems have been identified, the game goes back to the programmers or staff who help edit it again until the testers greenlight the game.

When it comes to testing, one of the main things you need to consider that uses data is how stable your game is. If there are buggy areas or levels, analyze which areas have the most bugs. You can create models to estimate issues based on past fixes and also to figure out time frames. You need to categorize these bugs into low-level, high-level, and critical ones and prioritize solving the latter. Also, test for audience engagement and game difficulty. Talk to your game testers who can give you data as to whether your game excites them, how many hours your testers have been playing it, and their impressions. If game testers love playing your game, it’s a great sign. If the testing sessions go past the allotted time, it is likely you have something engaging and fun, and therefore, more likely to succeed on your hands. In contrast to the above, if your game development team doesn’t really play your game despite being the ones who make it, there is probably something that isn’t right with it and needs looking into.


These are activities in the game lifecycle that help market, promote, and further test a game. It can involve adverts with gameplay footage, game screenshots, or opening up testing to the public. Some things which you need to consider are:

  • Have you planned for an alpha/beta release? What do your alpha testers think about your game? There is a lot of gaming data you can gather from your testers here which include engagement data, game balancing data, information about bugs and exploits, and general feedback. You will want to build an analytics pipeline with this data to constantly drive improvement.
A streamlined analytics pipeline can help make optimizing your game and fixing bugs significantly easier.
  •  DAU (daily active users), MAU (monthly active users), and CCU (concurrent users) are very important metrics that can tell you how many people enjoy playing your game. You want to keep an eye on these numbers and ask your testers their reasons if there are any abrupt decreases. Keep in mind that your beta testers are usually excited to try out something new that they have early access to. You can expect your final audience to have lower retention rates than your testers.
  • In your pipeline, one of the major areas to look at is session duration and frequency. See how long and how often your testers play your game, and if they stop playing at any particular point. This can give important insights into which parts of your game might be boring or too complex for the average player.
  • What’s your marketing budget and strategy? Where are you going to be focusing your resources? Look at past games released to see where you’ll be able to get the most bang for your buck, whether it’s showcases at gaming conferences or just advertising campaigns.


This is when your game is released to the world at large. Before you do so, you’ll spend the time leading up to your launch date crossing off bugs and fixes, as well as polishing up your game before sending it out into the market.

Again, this is one of those stages where you don’t have as much use for data, however, you can still use the analytics pipeline to optimize your game for multiple platforms/system configurations as well as polish it. You can also create better timelines and decide if a launch delay or overtime working is necessary for squashing the bugs which were found during extensive testing based on the time taken to fix the existing ones.


In this last stage of the game lifecycle, your game is finally done and people are playing it. However, your work isn’t over yet. There might still be some bugs in your game, usually on certain operating systems or hardware configurations. As and when your players submit bug reports, your team can help fix them. Another major thing on your plate is providing game balance updates and patches- may be one antagonist is too hard to kill or one weapon is too overpowered. You’d want to balance these issues to ensure the game is playable. Finally, releasing new content has become standard practice as well in the form of DLCs, where you can increase the replay value of your game and keep it fresh for your audience. Some things you should consider:

  • Look at your post-game release statistics like DAU, MAU, and CCU to see if your user base is stable or growing. If your churn rate is high, understand why by asking your users or seeing which level or segment of the game they leave.
  • Revenue data is also important. Look at your CPI (cost per install), ARPU (average revenue per user), and ATV (average transaction value) to understand where you need to optimize your game and improve it to both increase revenue and provide a better user experience.
  • Is your team resolving the issues which players are submitting in bug reports? Is the frequency of bugs increasing for some reason? Are you communicating the resolution of significant issues with your audience and keeping them updated?
  • Are you keeping the game balanced and rolling out patches to improve the quality of play? Again, tools like sentiment analysis can be of huge help here as they let you track sentiments across the various individual aspects of a game like combat, mechanics, characters, and story.
  • Is your team developing and releasing new content which is of a high standard and keeps the audience engaged? Focus on session duration and frequency to understand where your users might find the game too boring or hard, as well as how you can improve engagement. 

Audiences love personalization. For example, CD Projekt Red, buoyed by the success of the in-game card game Gwent from the Witcher 3, released a standalone version. It’s still a success, and it’s not just because of frequent patches. They have a ton of customizations such as card backs, game boards, several detailed titles and player avatars which you can earn by playing, and lots more. Some of these you can buy but all of them make the game feel like it’s truly yours. They keep the game from going stale, but more than that, CD Projekt Red uses data to monitor the state of the game, be it in-game statistics or forums like Reddit. They see if any cards are overpowered or broken and are willing to hotfix these issues. Their patch notes are also extensive and mention why these changes have been made.

  • Apart from in-game personalization, other gaming data such as play style, purchasing behaviors, and more, can be used to see what your audience enjoys in a game and you can build based on that. Post release changes to improve quality of life within the game can also prove important. Riot Games does a fantastic job with this which can be seen in their blogs and patch notes for Valorant. They point out issues they’ve noticed, the fix they’re providing or mention they’re working on solutions, and other things that are coming up in the game. This sort of update for your audience not only keeps them in the loop but also makes them feel valued.

Data can help you answer these questions and keep track of your game’s quality across its lifecycle.

The Role of Data in the Future of Game Development

A lot of applications of data for game development which we pointed out above are very much in use these days. With the gaming industry becoming the world’s dominant form of entertainment, there’s a question of what the future gaming experience will look like. However, with increased gaming data capture and leveraging it at every aspect of the game’s lifecycle, the question is what will the future of data in game development be like. That lies in a few key fields which have been gaining traction. Predictive analytics is one of these- it can help you anticipate actions that players will take, and help you stay ahead of your competitors. The goal of predictive analytics in the gaming industry is to create statistical models that ingest both historical and current data to calculate scores, risks, and predictions based on an outcome. For instance, predictive models can help gaming companies influence in-game purchases, prevent churn, and optimize lifetime value. The use cases for predictive analytics in gaming are pretty diverse. These include:

  • Game development – identify optimization points for product and marketing teams to make optimizations
  • Monetization – make predictions on behavior that lead up to purchases (i.e. freemium to paid subscriptions)
  • Game design – use algorithms to determine the best ways to keep players engaged
  • Game experience – help determine visual effects and graphics that are most likely to resonate with players
  • Personalized marketing – determine the messaging that will best resonate with individual players
  • Fraud detection – validate that players are who they say they are and avoid problematic behaviors before they have a chance to happen

Apart from predictive analytics, artificial intelligence (AI) is helping the video game industry level up. It saves time and money for developers by automating time-consuming tasks and speeding them up. For example, extensive QA testing is needed to make sure your game doesn’t have glitches or bugs but this sort of testing can be extremely time-consuming. However, AI can help you get over that hurdle. A fantastic example of this is Larian Studio’s proprietary AI World Tester. When a new build for a game is put together, the World Tester pushes the game’s boundaries, going through combat, dialogue options, and menus in search of bugs faster than any human QA team could ever hope to do. The World Tester can even juggle multiple builds at the same time, simulating hours of gameplay at once. 

Larian Studio's World Tester AI makes checking for game-breaking issues significantly easier for its human team.

AI can also help with automating graphics, player verification, and even making games without needing to know code. Another key application is monitoring toxicity in online games. AI has helped Blizzard find abusive behavior and punish it by verifying player reports. By continually looking for patterns in player reports, the machine learning algorithm gets better at identifying offensive communications. Companies like Riot Games have also begun leveraging machine learning and other advanced technologies to parse massive volumes of chats, understand the unique semantics of gamer slang and acronyms, and craft automated yet contextually appropriate responses to abusers.

The decisions that you make for your gaming analytics strategy today will create the foundation for your company’s future in the gaming industry. We’ve already started using video game data for building games and selling them effectively. However, as you can see above, it could be so much more. 

Gameopedia’s video game data helps publishers and game makers to understand, market, and help make better games. Whether it’s understanding trends in games via our game taxonomy or using sentiment analysis to understand your audience at a feature level, reach out to us to get access to game data that can empower you to make the best data-driven decisions.

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Indie, AAA, and AA Games: A Comparison

This is a part of Gameopedia’s Game Terminology and Taxonomy series, where we talk about the different kinds of game categories and aim to give our audience in-depth knowledge about them. This blog consolidates the difference between the major classes of games- Indie, AA, and AAA.

The video games industry generated almost $180 billion in 2020. In 2021, the video game market size in just the United States surpassed $85.86 billion. Video games, whether they are AAA, indie, or AA titles are important as a market for not just their significant revenue numbers but also for the value they create for the video game ecosystem. We’ve extensively covered AAA and Indie games in our previous blogs and broken them down based on factors like their budget and scope. However, to make it easier for those who use these classifications, we’ll discuss the salient points of each video game class and distinguish between them.

Deciphering Indie, AAA, and AA Games

While many find these informal yet effective definitions of benefit, game developers and publishers use them for marketing. Another group of people who use them extensively are e-retailers while categorizing game titles and pages.

Let’s look at the basic definition for each before we head into the differences between them.

Indie Games: Indie game stands for independent video game. Indie game companies are of two kinds. The first refers to the “independent” status of the company-  they are not owned by a parent company that defines the company’s direction. The other refers to the small, self-funded nature of these companies. In the indie game industry, studios are often made up of less than ten people (sometimes even one person) and usually depend on crowdfunding and donations to fund their games. There are some highly successful indie studios who are financially stable but still produce smaller games. Examples of Indie games include Transistor, Minecraft, and Celeste.


AAA Games: These are game titles made by companies that can produce huge, blockbuster-style games. They have large budgets – both for development and marketing – and they sell several million units upon release. These companies are staffed by hundreds of people, usually spread across offices in multiple countries.  Examples of AAA games are the Assassin’s Creed series, FIFA titles, and Final Fantasy games.


AA Games: These are titles made by companies with significantly smaller budgets allocated to produce their games. They are still developed by large groups of people spread across multiple offices, but they do not have the scale and reach of AAA games. Some examples of AA games are Life is Strange, A Plague Tale: Innocence, and Remember Me.

What Separates Indie, AAA, and AA Games

Let us look at how these game classes stack up against each other.

  Indie AAA AA
Development Budget On average, the real development cost of an Indie game is around a few thousand dollars to $1 million. Ranges upward of $50 million, if not significantly more. It is estimated that GTA V cost over $137 million just to develop. The costs for these are extremely variable, lying between that of an indie and a AAA game. For instance, the pre-production budget for Life is Strange was around €4 million.
Marketing Push Indie games often rely on word of mouth or curated collections to be made known to their audience. Social media, communities, and forums are also major points of importance for their marketing push. Marketing budgets can also be similar to or even higher than the development cost. An example would be Final Fantasy VII, which cost around $45 million to make, and had a U.S. marketing budget of around $100 million. There are not many concrete details available about AA game marketing budgets but they are between those of indie and AAA games, but usually a lot less than the latter. For instance, PUBG had no marketing budget at all but used word of mouth by partnering with Twitch streamers to promote their game.
Team Size Indie games are made by small teams, at times consisting of just one person. For example, Undertale in its entirety was made by one Toby Fox. The production teams for AAA title video games are huge, with at least 50 to 100 employees working on it. For instance, at Ubisoft, AAA game development for open world games involved 400 to 600 people. Again, detailed data is not exactly available for AA games. However, going by games like Life is Strange, whose team grew to a size of about 40 people, Hellblade: Senua’s Sacrifice, which had a team of 20 people, and PUBG with 35 people we can say the size is usually below 50 people.
Dedicated Publisher They don’t have a dedicated publisher, or if they do, they maintain creative freedom. These games are usually published and made by large, established companies with a great deal of experience. A double-A development studio will typically be backed by a publisher but not fundamentally part of that publisher, and thus have somewhat more freedom to innovate and experiment compared to AAA studios.
Graphics & Technology They tend to focus more on innovation, storytelling, and fun mechanics. Their graphics and technology are usually far from cutting edge AAA games tend to use the latest technologies like game engines and custom development tools. They often develop their own proprietary game engines, such as Epic Games’ Unreal Engine and use expensive tech like motion capture to render gorgeous cinematics and animations. AA games usually prioritize excellent gameplay and storytelling, or innovative mechanics. However, their graphical and technical quality is certainly high-quality, if not cutting edge.
Production Values Indie games are usually smaller in scale compared to their counterparts. Their voice/acting talent might not be the best in the industry however and these games tend to focus on interesting mechanics and excellent storytelling because of their limited budgets. Triple-A games hire famous and established voice actors and character models for their games. For example, Mark Hamill voiced the Joker in Arkham Asylum and Kit Harrington was a major antagonist in Call of Duty: Infinite Warfare. AA games fall in the middle: they are expected to have good production values, but often, character models and voice actors feature people who aren’t very famous. A Plague Tale: Innocence went to the extent of developing their own proprietary engine and putting extensive detail into textures and lighting.
Franchising If an indie game is successful, their developing studio might be acquired and sequels made, or the developers might make a sequel themselves. Some examples are Axiom Verge 2 and the to-be-released Hollow Knight Silksong. However, these are the exceptions rather than the norm. These are usually intended to become video game franchises post-success. For example, FIFA and Assassin’s Creed. These games tend to become franchises if their first venture proves a success. Example: A Plague Tale: Innocence, has a sequel Requiem expected in 2022.
Threshold for Success Titles in the Indie game industry have a low threshold for success as their development budgets are lower. These games have a high threshold for success and ideally sell upward of 2~ million copies to break even if not be profitable, though this depends on their total budget. While data is not easily available for AA games, going by their budgets, their threshold lies between AAA and Indie Games.
Streaming and Content Indie games like Among Us created a huge buzz in 2020 thanks to streamers playing it in groups. Minecraft has always had a huge YouTube community as well. A lot of AAA titles are streamed on platforms like Twitch and Youtube, generating millions of views. Watching their streamers play through games like Genshin Impact or The Witcher 3 is an enjoyable pastime for many. AA games like It Takes Two and Life is Strange are often played by popular streamers to their audiences on platforms like Twitch and generate a large number of views.
Esports Indie games aren’t very prevalent in e-sports. AAA titles account for most of the esports happening around the world, be it Valorant or League of Legends to name a few. A games contribute to esports on occasion. PUBG being a famous example that revitalized the battle royale genre and contributed to more esport events for this genre.
Notable Examples Celeste, Minecraft, Transistor, Hades. Assassin’s Creed, FIFA, The Elder Scrolls, the Final Fantasy video game franchise. A Plague Tale: Innocence, It Takes Two, Life is Strange, PUBG.

From the table above, you can see the notable characteristics of each game class as well as the key differences between them. This should be able to help you distinguish between AAA, AA, and Indie games.


With this blog we have tried to  understand the characteristics of the different game classes. We at Gameopedia have specialized in collecting and curating game information about AAA, AA, and Indie game titles for the last 12 years and have been working with companies across the gaming ecosystem. From release dates, genres, and descriptions to in-depth game breakdowns, we strive towards providing the best to our clients. Reach out to us at [email protected] to learn more about our offerings.

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