Analyst: Video Game Industry Revenue to Decline in 2019 for First Time Since 1995 - News
by William D'Angelo , posted on 02 May 2019 / 4,969 Views
Financial analyst Pelham Smithers speaking with Bloomberg says video game revenue in 2019 will decline for the first time since 1995. The analyst expects revenue to drop one percent to $136.5 million. He believes the decline will continue in 2020.
"The various bits of the jigsaw puzzle just don’t add up, so we’re looking for the market to shrink in 2019," said Smithers. "The sell-off in video game stocks is primarily down to a growing realization of the risk that this view is right."
He sees the mobile games revenue to drop by 10 percent in China due to Beijing’s tighter grip on game approvals. Console revenue is expected to also decrease due to fewer AAA releases and the decline in sales of the PlayStation 4 and Xbox One. PC revenue is also expected to slow as the popularity of battle royale games will decrease.
A life-long and avid gamer, William D'Angelo was first introduced to VGChartz in 2007. After years of supporting the site, he was brought on in 2010 as a junior analyst, working his way up to lead analyst in 2012. He has expanded his involvement in the gaming community by producing content on his own YouTube channel and Twitch channel dedicated to gaming Let's Plays and tutorials. You can contact the author at wdangelo@vgchartz.com or on Twitter @TrunksWD.
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You sure it has nothing to do with gamers starting to get up in arms about loot boxes and microtransactions as well?
$136.5 billion, not million.
Guys I think we just found Pachter's Alt account. Either that or this Smithers guy is his protege.
This definitely passes the smell test. Fortnite will likely decline some this year, and a 10% pullback there could probably account for a quarter percent decline in the entire video game market. There will be one or two fewer big Sony exclusive releases this year. Red Dead redemption 2 launched last year, and there is no GTA coming this year to make up for it.
On the other hand, there is a new Harry Potter mobile game coming, and other big free to play hits could pop up at any time. Also, it is possible that Fortnite does not decline like many expect it will.
So, I wouldn't bet very much money on a decline this year, but it certainly seems like a reasonable conclusion to say a small decline is likely.
...meanwhile, all real sales data continue to show growth, and prove otherwise. So much media and so called claims are unfounded, and without basis and merit. I'm going back to my love for expanded gaming, in the meantime.
Game sales nowadays are only a fraction of the income. With all the controversies about lootboxes, microtransactions and other monetisation schemes, it's very possible for ncome to be down all while game sales are up. With increased regulation against exploitative monetisation it is only normal that those games will make less money than they did in the past.
Also, keep in mind the drop is only 1%, which means software sales pretty much need to grow further to offset most of the monetisation losses
This paints a differnt story compared to the above headline https://venturebeat.com/2018/04/30/newzoo-global-games-expected-to-hit-180-1-billion-in-revenues-2021/
Switch to the rescue I hope for gaming's sake
The Switch will make up for all of that.
Seeing as both PS4 and XBO are in decline, and the major third party publishers are maxing out on how much they can milk gamers for extra money for less game, and Steam is slowing collapsing under the weight of its own unwillingness to curate its own store, if the gaming industry climbs in 2019, it'll be entirely on the back of the Switch, pretty much the only thing set to improve in 2019.
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