What Display Daily thinks: Game subscriptions are becoming a cornerstone monetization strategy for major gaming companies, with a focus on content, capabilities and accessibility. However, subscriptions are not yet the primary business model. Sustaining AAA game development within a subscription model has financial challenges. Thus, subscriptions will continue growing but complement, not replace, other business models in the gaming industry.
Do you invest in making sure that you have a cloud gaming strategy for your TV business? How much of a real investment is it, really? I mean, Samsung’s Gaming Hub, about the most hyped example you could find, is more of a landing page for game services, kind of a user experience bolt-on for its TVs, but not really a business strategy.
The games industry sees cloud gaming and streaming games and in-game purchases to be part of its desire to get premium titles onto smartphones, the multi-billion user platform that has, so far, eluded them because of performance limitations. TVs? It makes sense, but it’s marketing, not technology, and not strategy.
Game Subscriptions Growing to $22 Billion by 2027
The global game subscriptions market is forecast to reach $22 billion in revenue by 2027, representing 11.6% of total global spending on games. This follows strong growth in 2020 and 2021, though subscriptions plateaued somewhat in 2022 amid broader market trends. However, subscriptions are projected to rebound with 10.9% growth in 2023, reaching $16 billion in revenue.
Omdia categorizes game subscriptions into three main types: games library services at 44% market share ($7.3 billion in 2023), in-game subscriptions at 30% ($4.8 billion), and platform access subscriptions at 26% ($4.3 billion). The report further breaks down subscriptions into 8 sub-categories, profiles 8 key companies, and examines 10 major subscription services. The total number of paid subscriptions is forecast to reach 175 million by end of 2023, growing to 217 million by 2027. This excludes in-game subscriptions.
Microsoft and Sony lead in games library services, with 51 million combined subscriptions currently. Cloud gaming services are projected to generate $3.6 billion revenue in 2023, growing to $6.4 billion by 2027. This will be driven by services like Xbox Game Pass Ultimate and PlayStation Plus Premium. Pure cloud gaming services like Amazon Luna+ will remain small, at just 5% of total subscription revenue by 2027.
