How the Gaming Industry Is Changing in 2016

January 23, 2016

2:00 pm

The video gaming industry is expected to grow by 30 percent from $15 billion in 2014 to $19.6 billion in 2019 according to the forecast by PWC.

But what sort of changes should we expect apart from the obvious decline in traditional gaming hardware and the shift to digital?  While the gaming industry in general is pretty much unpredictable, here are some of the most likely changes we’ll witness throughout 2016.

VR and AR are Leading the Investment in Gaming

Though the market is still relatively narrow, more and more VR and AR startups will emerge in 2016. According to Venture Beat, 234 VR companies have raised over $3.8 billion in funding. And as long as there’s no single company to dominate the niche, we should expect to see more startups emerging.

Presence Capital closed a $10 million funding round in December, backing projects from Harmonix, Baobab, and Waygo. Facebook, Google, Microsoft, Intel, Samsung, HTC and Nvidia are just among the few other companies actively seeking for investment opportunities in this new market.

Considering the fact that a lot of successful social and mobile-game startups were funded after new major gaming platforms were created (e.g. Facebook and the iPhone), we can expect that a lot of startups will be funded and conceptualized before the announced launches of VR systems in 2016.  In fact, Presence Capital backed Harmonix is developing a music game up for Oculus Rift.

Game Design Will Become More Transparent

Recent experience proved that crowdfunding is an excellent way to raise money for a new game project and gain a dedicated community at the same time.

On top of that, a lot of big name brands including Xbox allowed fans to spy on the game development processes and have their say too.  This tendency is likely to pick up as more and more small studios seek for financial guarantees before committing to a new large project. Thus, the game development processes is likely to become more transparent.

“Live-streaming from the office is hard to do, but it’s really powerful. Think about Vlambeer – they stream all their development online. They’ve got something like 12,000 subscribers who are paying a monthly fee to access that stream – that’s a huge amount of revenue on its own, but then they’re also interacting closely with their audience in real-time,” – says Todd Harris of Hi-Rez studios.

The Demand for Game Developers Will Continue to Grow

Those considering a career in video game design can finally breathe. After a stable decline of 5.39 percent per year since 2014, the demand for skilled game designers is finally expected to rise again with an expected 7,940 new jobs filled by 2018 according to Recruiter.

Visual effect and animation artists are going to be in high demand as the new hardware and VR systems being released. Going back to a video game design school or polishing up your skills online may be a smart move for those seeking to work for AR and VR projects.

The Toys-to-Life Genre Will Continue to Expand

A few years ago it was impossible to imagine that you can use a physical toy for gaming interactions, however with the wild success of Skylanders franchise we can say those days are over.

More brands will continue to expand their franchises into a 360-degree dimension as both children and their parents become more used to navigating between live and screened entertainment. Considering that 34 perent of children aged under 11 have a tablet, the market is rather lucrative. Legoland in Windsor, for instance, recently launched an app that offers additional games and features to interact with during your visit to the park.

Indian and Brazilian Markets Are Booming

As smartphone adoption goes on bigger scale in emerging markets, such as Brazil and India, we should expect to see more games in those market taking off fast. After a decade of slow growth, both of these countries now look promising and, in fact, are even predicted to surpass the Western countries when it comes to mobile growth.

According to Atul Bagga,  the Indian mobile-game market can grow to a whopping $3 billion by 2019, compared to $200 million today. With the increase in smartphone affordability, the demographics and new business-friendly government, the Indian mobile-gaming market should be a lucrative space to tap into.

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Dianna is a former ESL teacher and World Teach volunteer, currently living in France. She's slightly addicted to apps and viral media trends and helps different companies with product localization and content strategies. You can tweet her at @dilabrien

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