For two years the video game business behaved like a market that could not shrink. Then, in 2022, an analyst firm drew a small downward arrow on the chart.
Ampere Analysis reported that spending on games had grown by $39 billion between 2019 and 2021, reaching $191 billion in 2021 as people stayed home. Its forecast for 2022 was a dip to $188 billion. Eurogamer described the figures as covering games, consoles and subscription services. GamesBeat read the report as a challenge to the idea that gaming is “recession-proof”.
Why the fall was expected
Ampere named several causes, and they differed by platform. Supply chain problems were still starving the market of consoles and PC hardware. Delayed games held back software sales. Inflation and the cost-of-living crisis bit into household budgets.
Elsewhere the pressures were regional. Eurogamer reported that Ampere saw PC gaming hit in key Asian markets by the pandemic-era closure of internet cafes, and Western companies pulling support from Russia after the invasion of Ukraine. On phones, privacy changes were making it harder to acquire users, so mobile was also expected to slip slightly. Cloud gaming was the exception to the declines.
A dip, not a collapse
The firm’s own wording was measured. “After two years of huge expansion, the games market is poised to hand back a bit of that growth in 2022 as multiple factors combine to undermine performance,” said research director Piers Harding Rolls. “Even so, the year will end well ahead of pre-pandemic performance, and the outlook for the sector as a whole remains positive, with growth forecast to return in 2023.”
The recovery case rested on component shortages easing, delayed games finally shipping and new markets taking up gaming. Ampere expected 2023 to be a steadier year.
Sources
- Report suggests games market might see decline in 2022 (GamesBeat)
- Video games market to decline year on year in 2022, study suggests (Eurogamer, mirrored)
