Report: Cloud Gaming Market Will Hit $6.5 Billion in Yearly Revenue in 2024
The Cloud Gaming market has been on a high boom as of late. It's cool to see projects like Xbox Cloud Gaming or GeForce Now come to life. While the market had a few missteps with certain projects, it's hard to deny that Cloud Gaming is slowly making its mark across the industry and the gaming community.
Newzoo has confirmed in their latest report that the cloud gaming market is continuing its steady growth. Not only that, but they predict that the market will hit $6.5 billion in global yearly revenues in 2024. Some of the most influential factors behind the growth of cloud gaming, at least according to Newzoo, are the following:
- The COVID-19 lockdowns around the world, which have persisted so far into 2021.
- The continued difficulty that users are experiencing on getting next-gen hardware. This includes consoles like the PS5 and PC components like GPUs and CPUs.
- The diversification of cloud gaming business models, with some services (such as
Facebook Cloud Gaming) opting to provide games via the cloud without users even
- The subsequent rise in consumer awareness of Cloud Gaming thanks to increased marketing efforts and services being launched worldwide.
The report goes on to talk about the Serviceable Obtainable Market (SOM). Players in emerging markets score higher in cloud gaming awareness than those in the Western Market. This is because gaming hardware becomes more expensive in said regions. As such, these players see a higher added value in Cloud Gaming than in other kinds of hardware.
Of course, the whole thing doesn't just revolve around interest. Game streaming as a whole has become less strict in terms of connection requirements. Internet connections are also improving around the world, making technical constraints much less of an issue. With this in mind, the SOM is now represented to be 42%, growing to almost 48% by 2024.
So, what's going to keep the market growing from now on? Well, there are a few things that make Newzoo remain confident regarding their forecast. Newzoo thinks that strong growth for Cloud Gaming should be expected this year and toward 2024 for the following reasons:
- Publishers have embraced cloud gaming as an alternative distribution option.
- New cloud services continue to launch while existing ones continue expanding.
- Technological progress and more refined business plans are enabling an increasingly frictionless user experience.
- The effects of COVID-19 continue as new outbreaks and ensuing lockdowns occur.
- Securing hardware will continue to be challenging until at least 2022.
Regarding that last point, you might have seen that the global chip shortage continues making its rounds across industries beyond gaming. Manufacturers across the globe in the automotive and consumer electronics product markets have been suffering from the drought. Of course, we've reported on the impact this problem has had in Gaming for a while now.
Regardless of all this positive growth, it will still take multiple years before people who pay for cloud gaming services will see it as their main way to play video games. While cloud gaming is a great alternative for people in emerging markets, it's still going to need to address the issues regarding internet speeds.
What do you think about this topic knowing all of this? Do you think the market will continue to grow or will it stop as soon as the pandemic and chip shortages end? I'd like to see your thoughts on the matter so let's talk about it in the comments.