Global video game industry on a healthy growth trajectory to $250 billion

The global market for video games is expected to see 6% annual growth, with the market to crack the $250 billion by 2028. That is according to new research from Bain & Company.

The global video game industry is leveling up: The sector is performing well enough to be stealing the show from other media types, having reached revenue of about $196 billion in 2023, which was more than streaming and box-office sales combined.

Video games have expanded well beyond merely consoles and PCs, with mobile gaming, cloud platforms, and virtual reality experiences now leading the way. From immersive virtual reality titles to casual smartphone games, the gaming landscape offers diverse options for players.

“We’re seeing a surge in global video game audiences, driven by young people who are spending more time on games and less time on video and other media,” said Daniel Hong, global leader of Bain & Company’s Media & Entertainment practice.

“Players say they want more immersive games and more interoperability across devices and platforms. They’re also spending more time in game environments, socializing, shopping, and consuming other media,” Hong continued.

The audience for video games is varied, with the study showing 52% of people of any age play video games regularly. But clearly, video games are most popular among younger people. A total of 80% of respondents from age 2 to 18 years old identified themselves as gamers.

Younger gamers typically spend about 30% of their entertainment time in video game environments. Some of the reason for that could be because since the pandemic, gaming environments have begun to be seen as a social environment, where kids and teens can meet up with their friends virtually.

One major new trend in gaming in recent years has been the boom in games that allow players to co-create their experience. Games like Minecraft and Roblox, which invite users to create their own worlds, have proven to be immensely popular. A total of 79% of gamers say they engage with user-generated content.

Generative AI is likely to accelerate this trend in the future by allowing players to use tools to fine-tune their gaming experience. Some players have become incredibly popular by streaming, gaining millions of followers. These influencers are then able to generate more engagement with certain games.

Overall, the video game industry has become more than just gaming: Gamers now socialize, shop, watch videos, and more. The study found that gamers that engage in more varied activities around video games also tend to spend more.

“In this evolving landscape, leading companies will need to strategically consolidate customer relationships to expand their market share. This shift will require gaming companies to rethink their interactions with customers and competitors alike as the industry adapts to new technological realities,” said Moncef Maghrebi, partner at Bain & Company in the Middle East.

Another recent study showed how in recent years, the MENA region has become one of the fastest growing video game markets in the world. With an impressive annual growth rate of 25%, the expansion of the gaming marker in MENA is currently three times faster than that of China.