How the gaming industry is thriving in a post pandemic world
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When COVID-19 struck, the Earth stood still. Nations went into lockdown and businesses shut down.
Reminiscent of a post-apocalyptic world, people were forced to stay indoors and distance themselves from others. The virus wasn’t the enemy. Boredom was!
The human spirit prevails. Called the COVID-19 small business boom, startups surged during the pandemic. It upended conventional wisdom of what an economy in crisis looks like.
Economist John C. Haltiwanger noted that 2020 was a record year for new business registration in the U.S. – an increase of 20% on the previous year.
Gaming ahead of the curve
Gaming was one industry that avoided the stagnation curse. Instead of becoming another statistic, the sector was a virtual meeting place for everyday people; a lifeline for lonely and isolated individuals.
Statista claims gaming emerged as one of the most popular activities during the initial outbreak. Studios reported most of their revenue was via digital content. Cyberpunk 2077 developer CD Projekt posted 91% digital revenues.
Now that the pandemic is behind us, it’s interesting to witness how gaming thrives in a technologically evolving landscape. Below, we’ll explain how.
The rise of eSports platforms
Hard lockdown gave rise to eSports social sportsbooks as sports fans sought alternatives to live games. Competitors played online against each other or as teams.
With younger generations growing up in the restricted confines of their homes, it increased online engagement and introduced people under 24 to eSports.
However, it wasn’t only eSports thriving under less-than-favorable conditions.
Social casinos connected people from across the globe craving human interaction and fun. The World Economic Forum states that 16% of European gamers said spending time on multiplayer genres helped their mental health during lockdown.
Online third place
Free-to-play games like Fortnite, Apex Legends and Rebet social casino occupied people in constructive ways.
Because most social casino games don’t operate with real money, online users felt safe betting their virtual coins while making meaningful connections with other players.
Winnings came in the form of bonuses, prizes and promotions. All one had to do was visit the Apple App Store or Google Play Store and download an app. The process was as easy as setting up an account and signing in.
Researchers Constance Steinkuehler and Dmitri Williams coined a term for socializing online during quarantine – the online third place. Conversation, accessibility and a playful mood define the online third place.
Online gaming communities have found their tribes on social gaming platforms and websites which is why people play casino games not for the wins but for engagement.
Cozy gaming
The pandemic forced many of us to do some introspective work. For some, it meant a desire for simpler times. A burgeoning online community craved nostalgia and calm, simple games.
Before 2019, not many people knew about cozy gaming. It was a subset that avid gamers didn’t pay much heed to. That soon changed during COVID-19. Games like Stardew Valley became overnight sensations.
YouTube and Twitch now have channels dedicated to cozy gaming streamers. Kennedy R, best known as Cozy K has half a million TikTok followers waiting to watch her next upload.
The low-stakes and casual vibes of cozy games are an anomaly.
However, associate professor of gaming, Kris Alexander tells Rolling Stone interest in these games has surged over the past three years. It reflects a growing demand for culturally and personally relevant gaming experiences.
Noticeable contradictions
While the gaming industry continues to experience cultural highs, Epyllion CEO Matthew Ball has been taking notes. He says the outside world viewed 2023 as one of the greatest years for the gaming industry.
From new software releases to hardware upgrades, the ecosystem experienced a golden age.
Sadly, those who worked in gaming became victims of layoffs and downscaling. About 10,500 employees were given the boot, says Ball who claims that most studios overlooked the declining sales.
Even now, big tech companies are poaching game developers, especially those working with AI, by offering significantly higher pay. From 2019 to 2022, venture capital funding enabled gaming startups to offer high salaries, making it hard for established gaming companies to compete.
Leading in innovation and creativity
Despite Ball’s observations, others are confident that 2025 will bring immense potential for gaming startups.
GamesBeat believes slow secular trends open massive opportunities for disruptors and creators.
Large companies facing challenges should invest in growth – overall gaming revenue may have decreased but gamers are increasing. It’s just that they are consuming content differently. Players are opting for free-to-play games instead of paying for titles.
As the industry makes way for indie games, it could be the dawn of a new business model for established publishers.
The gaming industry is resilient and has proven its worth during COVID-19. The question is: can it scale without leaving loyal gamers behind? Time will tell.