Global Cloud Gaming Market Trends & Forecast

Market Insights

The cloud gaming market is estimated to grow from USD 1.43 billion in 2021 to USD 10.5 billion by 2027 at an impressive CAGR of 29.1% during the forecast period.

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What is cloud gaming?

Cloud gaming refers to the process of playing video games on servers located remotely in data centers. It requires a high-speed, stable, and low-latency internet connection to stream the game on the cloud gaming platform; there is no need to download or install games on any device.

The games can be played with the help of a controller in various devices, such as a smart TV or a gaming console, which transmits data to the server, in the form of input. The output information is projected on the display module by the server. This, in turn, provides critical information to the data center, and the game is rendered and played on a remote server with local interaction on devices.

It provides the benefits to gamers to play any game, at any time, and on any device. It also served as a source of socialization and entertainment at the time of the pandemic. Cloud gaming platforms are in high demand as they provide better gaming experiences and reach out to a large number of gamers in the new normal (post-pandemic).

Key Players

The cloud gaming market is gradually consolidating with major companies performing mergers & acquisitions to quickly gain the leading position and to tap growing opportunities in this rapidly expanding market.

The following are some of the key players in the global market:

• Sony Corporation
• Nvidia Corporation
• Microsoft Corporation
• Amazon Inc.
• Ubitus K.K.

For instance, Sony Corporation, a leading provider of cloud gaming across the regions, acquired Bungie. After the acquisition, Sony Corporation successfully leaped ahead in the market with the added capabilities and expansion of its game titles. However, the market entry of several new players is likely to make the business environment challenging for the major players.

The supply chain of the cloud gaming industry comprises cloud computing providers, game developers, cloud gaming providers, telecommunication partners, and end-users. Major players are striving hard to integrate vertically to gain a competitive edge in the market.

Market Dynamics

These factors are expected to boost the demand for the global market in the coming year:

• The year 2021, was an annus mirabilis for cloud gaming with a surge in the number of internet users and consumer spending, which has been increasing year on year.
• Furthermore, expected growth in 5G infrastructure is likely to drive the demand for the market by reducing latency issues when streaming video games.
• The long-term market outlook seems favorable, with ample growth opportunities across regions.
• Also, the an ongoing shift from consoles to cloud-based gaming. 

Segment Analysis

Streaming Trends

The market is bifurcated into video streaming and file streaming. Video streaming is likely to remain the bigger demand generator for cloud gaming platforms in the foreseeable future. This segment held more than 80% market share in 2021. The key factors driving the segment's dominance are on-demand streaming requirements as well as the ability to be effective for shorter periods of play. Furthermore, a paradigm shift from console and disc-based gaming to cloud-based gaming ensures a massive demand for cloud gaming platforms in the coming years.

Device Trends

The market is segmented as PC & laptops, smartphones, smart TVs, and gaming consoles. Smart TVs remain at the nucleus for all the leading market stakeholders serving the cloud gaming industry. The smart TVs segment held more than 35% market share in 2021. A smart TV provides a better gaming experience to its gamers with features such as a 4K display and better feasibility in using cloud gaming platforms with the help of a controller.

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Partnerships with smart TV manufacturers, OTT providers, and setup box providers to reach a large number of cloud gaming users are likely to provide market stakeholders with enormous growth potential. It is also anticipated that Smart TV will remain the most preferred device type in the market in the foreseen future.  

Genre Trends

The market is segmented as puzzles & social games, adventure & sports, and arcade. Among these genre types, puzzles & social games are the most widely played category on cloud gaming platforms, as players choose to play these games with their friends in order to socialize with them, implying that the market for puzzles & social games is rising. In addition, comprehending the game takes less time in this category. Moreover, the puzzles & social games held more than 35% market share in 2021.

Gamer Trends

The market is segmented into casual gamers and hardcore gamers. Between these gamer types, casual gamers dominate the market, whereas hardcore gamers continue to prefer console gaming. Casual gamers prefer cloud gaming because it is more cost-effective. In addition, the casual gamer segment held more than 70% market share in 2021.

Regional Analysis

Asia-Pacific held more than 35% market share in 2021 and is expected to remain the largest market for cloud gaming over the forecast period. In addition, the region is likely to witness healthy market growth in the coming years. Japan, India, and Southeast Asia are the preferred destinations for gaming companies to expand in Asia. The leading player in the market, Sony Corporation has expansion plans in the region.

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Already existing 5G infrastructure in countries such as Malaysia and Thailand is creating healthy demand for the market. The partnership between Blacknut and Celcom telecommunication, Tencent to launch its cloud gaming platform in Southeast Asian countries, and the development of 5G infrastructure in key Asian economies such as India and China are likely to generate huge demand for cloud gaming in the region.

Segmentation

The global cloud gaming market is segmented into the following categories:

By Streaming Type

• Video Streaming
• File Streaming

By Device Type

• PC & Laptops
• Smartphones
• Smart TVs
• Gaming Consoles

By Genre Type

• Puzzles & Social Games
• Adventure & Sports
• Arcade

By Gamer Type

• Casual Gamers
• Hardcore Gamers

By Region

• North America (Country Analysis: The USA and Rest of North America)
• Europe (Country Analysis: Germany, France, The UK and Rest of Europe)
• Asia-Pacific (Country Analysis: China, Japan, India, South-East Asia, and Rest of Asia-Pacific)
• Rest of the World (Sub-Region Analysis: Latin America, Middle East, and Others)

Research Methodology

This strategic assessment report, from Stratview Research, provides a comprehensive analysis that reflects today’s cloud gaming market realities and future market possibilities for the forecast period of 2022 to 2027. The report segments and analyzes the market in the most detailed manner in order to provide a panoramic view of the market.

The vital data/information provided in the report can play a crucial role for the market participants as well as investors in the identification of the low-hanging fruits available in the market as well as to formulate the growth strategies to expedite their growth process.

This report offers high-quality insights and is the outcome of a detailed research methodology comprising extensive secondary research, rigorous primary interviews with industry stakeholders, and validation and triangulation with Stratview Research’s internal database and statistical tools. 

More than 1,000 authenticated secondary sources, such as company annual reports, fact books, press releases, journals, investor presentations, white papers, patents, and articles, have been leveraged to gather the data. 

We conducted more than 15 detailed primary interviews with the market players across the value chain in all four regions and industry experts to obtain both qualitative and quantitative insights.

Report Features

This report provides market intelligence in the most comprehensive way. The report structure has been kept such that it offers maximum business value. It provides critical insights into the market dynamics and will enable strategic decision-making for the existing market players as well as those willing to enter the market.

What Deliverables Will You Get in this Report?

Customization Options

Stratview Research offers one of the following free customization options to our respectable clients:

Company Profiling

• Detailed profiling of additional market players (up to three players)
• SWOT analysis of key players (up to three players)

Competitive Benchmarking

• Benchmarking of key players on the following parameters: Product portfolio, geographical reach, regional presence, and strategic alliances

Custom Research: Stratview Research offers custom research services across the sectors. In case of any custom research requirement related to market assessment, competitive benchmarking, sourcing and procurement, target screening, and others, please send your inquiry to sales@Stratviewresearch.com.

Recent Developments

On 2 August 2023, GTA V's popularity increased Xbox cloud gaming wait times as Rockstar brought GTA 5 and GTA Online back to Xbox Game Pass. All devices that enable Xbox Cloud Streaming are compatible with Ultimate members playing the game.

On 2 August 2023, Samsung plans to push into cloud gaming beyond TVs, similar to YouTube, to simplify game discovery for users and publishers. This initiative aligns with the company's priorities and growth opportunities.

On 28 April 2023, Microsoft and Nware signed a 10-year deal to stream Xbox games on Nware's platform, despite the Competition and Markets Authority blocking Activision Blizzard titles. The agreement will allow users to enjoy PC games built by Xbox on Nware's platform.