Video games have rapidly developed into a major entertainment industry. It is already going through a major change as mobile devices, game streaming services and new business models are emerging. Free games are truly trending – they generate more revenue than games that must be purchased. Are video games becoming an industry that surpasses all other entertainment businesses? Let’s take a look.
Superdata, a Nielsen company, has collected 2018 revenue statistics for video games. The gaming industry earned 119 billion dollars in 2018 according to a report the company has published. Here are highlights from the report.
Top 10 free games as measured by revenue
Naturally, there must a way for game developers and publishers to generate revenue to cover the massive costs of creating a new game, so free-to-play games are not entirely free. Players buy new features, objects or shortcuts when they want to advance in the game.
Top 10 free-to-play games by revenue in 2018 were:
- Fortnite (revenue 2.4 billion dollars)
- Dungeon Fighter Online
- League of Legends
- Pokemon Go
- Honour of Kings
- Fate/Grand Order
- Candy Crush Saga
- Monster Strike
- Clash Royale (revenue 0.9 billion)
Fortnite made 2.4 billion dollars in revenue in 2018. That’s more than double than the bestselling game that must be purchased – Battlegrounds. Even the tenth free-to-play game, Clash Royale, made almost one billion dollars (0.9).
The largest number of users for free games are from Asia. The majority of Asian gamers play on their phones. This is exactly the opposite situation as in games that have to be purchased before they can be played.
How big game industry is? Let’s compare it to movies
The numbers the worldwide game industry has tallied up are big, but how big really? Let’s compare two entertainment industries: games and movies to determine where they stand in popularity.
Top 10 movies worldwide 2018 in box office
Popular movies generate revenue for years after they have been in theaters, but here are revenue numbers for the box office (by The Numbers).
- Avengers: Infinity War (2.048 billion dollars)
- Black Panther
- Jurassic World: Fallen Kingdom
- Incredibles 2
- Bohemian Rhapsody
- Mission: Impossible—Fallout
- Deadpool 2
- Fantastic Beasts: The Crimes of Grindelwald (0.652 billion dollars)
Top 10 movies and free games generated roughly similar level of revenues in 2018. If purchased games are added to the game revenue top 10, games have made more revenue than movies during a year. A single movie, however, makes money for years from TV rights, streaming services, and perhaps licenses sold to the game industry. Blade Runner is a classic example of this business.
Top 10 purchased PC and console games in 2018
The Battlegrounds was the only paid-for game that made more than one billion dollars in revenue (1,028).
- Player Unknown Battlegrounds
- FIFA 18
- Grand Theft Auto V
- Call of Duty: Black Ops 4
- Red Dead Redemption 2
- Call of Duty: WWII
- FIFA 19
- Monster Hunter: World
- Tom Clancy’s Rainbow Six: Siege
Gamers in North America and Europe used practically equal amount of money on PC and console games in 2018. Gamers in Asia spent only about one-fifth of what Americans or Europeans spent.
Game Viewing Services
Gaming video content (GVC) services let fans follow other players’ games via the internet. Especially, big tournaments attract large online audiences.
Somewhat surprisingly, Twitch generated more game viewing revenue than YouTube: Twitch 1.6 billion and YouTube 1.2 billion dollars. Other viewing services managed to make altogether 2.4 billion dollars in revenue.
So, what the most popular games and movies have in common?
The most popular free-to-play games and box office hit movies generate similar level of revenues during a year. Another thing that they share are characters, plots and worlds. Sometimes, a movie like Blade Runner has been developed into a game, but it is possible to create a game first, and then borrow the world to a movie.