How Much is the Gaming Industry Worth?

When you sit down on the couch to grab a controller and play a game on your console, you find yourself immersed in a virtual world that is full of awesome things. You can be a special forces operator, demon-slaying warrior, giant military robot, medieval knight, or even an Italian plumber who jumps around collecting coins and eating mushrooms.

But have you ever thought about how much the gaming industry is worth? Granted, that doesn’t have any immediate impact on the game you’re playing, but it might change how you play games in the future. Did you know that the gaming industry right now is bigger than movies and music combined? Bet that one was a shocker, and we’ve got plenty more exciting facts about the gaming industry coming up in this article. So suit up because we’re about to show you just how big the gaming economy has become over the past few decades.

How much is the gaming industry worth? While the answer will vary depending on the survey you look up; market researcher newzoo claims that the global games market was valued at $137.9 billion in 2018. That is an insanely high number, but even more astonishing is their prediction that the gaming market worldwide will be worth more than $180.1 billion by 2021. Currently, in 2019, the gaming industry is speculated to be worth $151.9 billion.

These figures contain data for all platforms- PC, mobile, console, Mac, and tablet. With the advent of game streaming services such as Google’s Stadia and Microsoft’s xCloud, you can bet that gaming will become even more mainstream than it already is, which means even more people will be introduced to this amazing form of entertainment.

Mobile gaming alone accounts for nearly half of the total gaming revenue worldwide, and if this year’s E3 is something to go by, we will see many more mobile games very soon. Ubisoft is releasing its mobile game based on a dream team of characters from various Tom Clancy games. It is called Elite Squad, and like it or not- the game will probably be highly monetized.

Bethesda is coming up with a Commander Keen mobile game, and Microsoft is releasing a funky pop version of Gears on mobile, called Gears Pop. Basically, every AAA dev from Activision Blizzard to EA and Ubisoft is jumping on the mobile game hype train, and why shouldn’t they? Smartphones and tablets combined accounted for $63.2 billion or 47% of the entire gaming industry revenue in 2018. One dollar out of every 10 dollars spent on games is on tablets since they account for nearly 10 percent of the global market.

How Much is the Gaming Industry Expected to Grow?

As far back as 2013, a study showed that U.S. customers spent nearly $21.53 billion on digital game content, hardware, and various other accessories. Do 21.53 billion dollars sound like a lot to you? Because there are about 100 countries on Earth with a GDP lower than that amount. It was also greater than digital music sales and cinema box office sales combined for that year.

Today, 4 out of 10 people surveyed admit to an interest in gaming, and it appears to be most popular among the demographic of males aged 16 to 24 years old (64% of males in that age group show interest in gaming). Game consoles these days double as home entertainment hubs, with gamers watching Netflix, Hulu, etc., on their Xbox and PlayStation. Esports is a rapidly growing sector, expect to hit the 2 billion dollar revenue mark by 2020, and it is a big draw for viewers too since a quarter of console gamers visit and other similar game streaming sites.

Mobile gaming has been on a fantastic track since the launch of the iPhone in 2007, with a decade of double-digit growth. The global games market will be worth 180.1 billion by 2021, with a CAGR (Compound Annual Growth Rate) of 10.3 percent between 2018 and 2021.

This is even more impressive when you consider the fact that gaming has been posting an average annual growth rate of over 10 percent since the last decade, which is impressive even for a single company, let alone an entire industry. Some projections put mobile gaming at a 100 billion dollar value by 2021, which will likely leech some of the revenue away from console and PC gaming.

The Contribution Of Mobile Games

More than 7 out of 10 internet users in the Asia Pacific region, middle east, and Africa play games on their smartphones or tablet. Regions with historically low internet penetration rates are now getting a taste of mobile gaming with a booming smartphone market, decreasing internet costs for phones, and an ever-increasing online population.

Today, the average mobile gamer spends approximately 3 hours and 44 minutes online on their smartphone, playing games. In Latin America, this figure is closer to a 5 hour daily average for smartphone gamers. With rapidly increasing processor power for mobile devices, advances in mobile graphics, new display technologies, and Augmented Reality on the horizon, it isn’t hard to predict that mobile gaming will keep growing at an extremely high rate for the next 4 to 5 years.

Interestingly, the highest growth rates for mobile gaming are being posted in markets with low internet penetration rates. This can be attributed to the spread of cheap smartphones (Oppo in China, for example) and increasing net penetration in these lesser developed regions such as Latin America, Indonesia, etc. Most mobile games are free to play, and they are monetized via in-app purchases, which provide you with gameplay benefits.

For example, let’s say you’re playing something like Clash of Clans where your goal is to build a base or “village,” level up your units, and you need resources in order to do that. Resources trickle at an extremely slow rate naturally, but you can buy resources with an in-game currency known as “gems.” These gems are purchased with real-world money. You level up your buildings faster, and instead of one week of waiting, you get the job done in 5 minutes.

Only 1 among 5 mobile gamers purchase their games. Right now, the smartphone is a well-established gaming platform, so the focus has shifted from “how do we get people to play on their phones to “how do we create better user engagement with more content.”

Games for smartphones are more monetized than ever before, and that can be a good or bad thing depending on how you look at it. In the majority of mobile games, the focus is placed on user retention through tedious gameplay mechanics where you are locked out of progression for extended periods of time by the game unless you spend real-world money. Some mobile games are extremely fun even without spending a bunch of money. But the majority of mobile games are what we call “casual” and “hyper-casual.”

What Role Does China Play?

Simply put, China is the biggest games market in the world. That is why both Steam and EPIC are rushing to release their online gaming stores in China. According to an August 2018 report by newzoo, the Chinese gaming market is comprised of 619.5 million players and generates $37.9 billion in revenue.

It sounds scary when you consider the fact that the total number of gamers in the whole world is 2.5 billion (25 percent of all gamers are in China), and China contributed to over 27 percent of the global gaming market revenue in 2018 all by itself. In Tier 1 and Tier 2 cities of China, the vast majority of online gamers (about 94%) spend money on in-game items or virtual goods.

The market is mainly driven by female mobile gamers, 60% of whom buy cosmetics or skins in-game. And over two-thirds (68%) of China’s urban population in Tier 1 and Tier 2 cities watch gaming-related content online, whether it be game streams by their favorite esports professionals or content of famous streamers/ online celebrities. About 56 percent of these viewers use their mobile devices to stream content.

The most-watched esports content in China is Arena of Valor, a mobile MOBA game. The majority of revenue generated by China in gaming is through mobile; 23 billion out of the 37.9 billion in 2018 was generated by mobile devices. PC and console games generated $14.4 billion and $0.6 billion, respectively. Clearly, consoles aren’t very popular in China, unlike in the U.S., where a vast number of people play on their Xbox or PlayStation.

Chinese game companies are now rushing to expand their potential market in Southeast Asia, Europe, and North America. Several of the new online free to play games and mobile titles you see these days incorporate Chinese game elements, and a lot of them are funded by Chinese R&D. China is definitely a huge player in the global gaming market with 3 times as many online gamers as the second-largest gaming market, the U.S. Newzoo estimates that by 2021, the smartphone market will expand to about 59 percent of global gaming revenue. You can bet your top dollar China is going to be the leader in that segment. Just look at how big PUBG Mobile and Arena of Valor are in China right now.

Video Games Industry Compared To Movies And Music

Netflix, in its quarterly earnings report for January 2019, stated that Fortnite might be a bigger threat to its business than HBO. As you might have heard, HBO plans to start its own streaming service for movies and shows to rival Netflix.

But with tens of millions of gamers ranging from kids to adults playing Fortnite and similar Battle Royale games, Netflix has admitted that it no longer views companies providing TV content and video streaming services as its only competition. And they should be worried because online gaming has shifted the attention of their consumer base away from TV shows and movies.

Even when you go all the way back to 2012, industry experts speculate that the amount of time spent on mobile apps was beginning to exceed TV viewing times. Fast forward to 2019, and Fortnite has grown to over 200 million players while Netflix is sitting at 139 million users.

Cross-platform gaming is a thing now, and players across various platforms- console, PC, and the phone will be able to play with each other, which will further increase revenue opportunities and the number of people who are interested in playing a certain game will now be able to enjoy it across multiple platforms.

Right now, the gaming industry is valued at nearly 152 billion U.S. dollars. And with advancements in technology such as game streaming, cloud services, crossplay, VR, etc., you can expect this figure to grow by 10 to 15 percent each consecutive year. Just from 2017 to 2018, the games industry posted a 10.9% growth rate.

The Call of Duty franchise by itself has generated more revenue than all the Harry Potter and James Bond movies combined. Youtuber Felix “PewDiePie” Kjellberg, with over 96 million subscribers as of now, made an estimated $15 million just in 2016, streaming himself playing games.

It is reported that there are 456 million viewers who watch games online, and a large chunk of them aren’t even gamers. Whereas TV revenue fell by 8 percent in 2018, gaming sector sales increased by 10.9 percent. Gaming industry-beating traditional media and entertainment isn’t anything new, and it has been going on for close to a decade. Back in 2014, according to, global revenue for video games was estimated to be around 83.6 billion dollars. In comparison, the movie industry made a “mere” 36.4 billion dollars.

Statista says that based on their research for 2014, the music industry made 15.06 billion dollars. Combined together, they still lose to gaming. Note that the film industry revenue in these states doesn’t account for DVD sales, streaming, etc., but we still speculate that with physical and digital sales combined, the movie industry is still much smaller than gaming, which has only grown bigger since 2014.

In the UK, video games account for half of all entertainment revenue, according to figures released by the Entertainment Retailers Association. Rockstar Games have stated that Red Dead Redemption 2, the wild west third-person shooter adventure game is the second-largest global entertainment launch in history, surpassed only by their own title Grand Theft Auto V, which was released in 2013 and broke 7 Guinness Book world record in the process.

GTA V manages to make over a billion dollars in just 3 days after its launch. To put things in perspective, when Avengers: Infinity War was released on April 27th, 2018, it set a record for the best opening box office for any movie until that point with $257,698,183 on opening day. Pretty awesome, right? But then you take a look at GTA V, which came out on September 17th, 2013, and amassed 817.5 million dollars within 24 hours by selling over 11 million copies. And it is currently the highest-grossing entertainment product of all time.

The not highest grossing game, but entertainment product- this includes movies, music, books, TV series, etc. GTA V has made over 6 billion dollars in revenue until now, which is higher than the GDP of many nations such as Liberia, Barbados, Grenada, Djibouti, etc. Even the most powerful release in the MCU, Avengers Endgame, doesn’t come close to beating GTA V’s opening day, and you can only imagine what GTA VI will look like in terms of revenue.


With lots of big names like Google, Microsoft, NVIDIA, etc., focusing on cloud-based gaming and games as a service business model, you can expect the global gaming industry to become much larger than it is even now. Market experts say it might be worth 300 billion dollars in 2025, which may sound pretty optimistic, but don’t forget how this industry has been posting double-digit growth for over a decade by now.

It is certainly not out of the realm of possibility. Cloud gaming means your local hardware doesn’t have to be very powerful; in fact, you can get photorealistic graphics on your smartphone or Chromebook since the server will handle all the processing. Gaming companies want to follow the Netflix model, offering games in the form of subscriptions, as you can already see with EA’s Origin Access program.

NVIDIA’s advances in AI and raytracing could mean realistic lighting and shadows, along with unique-looking NPC characters with truly human-like decision-making abilities. High-speed internet is much more accessible now, and mobile gaming is more popular than ever with cheaper smartphones. The future of gaming is looking bright, and let’s not forget esports- even though you may not be a competitive gamer yourself, you can surely enjoy watching pros compete at the peak of human ability, executing mind-blowing moves on the big stage.

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