We all know that the gaming industry is huge, because we see it on tabloid headlines after every successful release. Print media spent years burying their heads in the sand and ignoring the rapid progression of this industry, and now that they are forced to acknowledge it they are acting like it’s a big surprise that they haven’t seen coming through years of reports and sales figures. But even the experts, the ones who have seen it coming and understand its significance, may be surprised by just how big it has become and how much it’s worth.
Grand Theft Auto 5 Beats Everything
Grand Theft Auto 5 is the best selling media release ever, with no film, book or album coming close. In 2018 it reached over $6 billion in revenue, selling more than 90 million copies.
To put this into perspective, the Da Vinci Code sold around 80 million copies, but even at their highest price these copies were still 4 or 5 times less than GTA V, which means their revenue doesn’t come close. Although the exact figures don’t exist, it’s likely a similar story with The Bible, which is the best selling book ever. Over 5 billion copies are reported to have been “sold”, but these numbers include hundreds of millions of books that were donated, not to mention millions more sold at hugely discounted prices to churches, schools and hotel chains. As for films, Avatar is often said to be the highest grossing, pulling in $2.7 billion at the box office, but this isn’t even half of what GTV 5 managed.
Gaming is Bigger Than Most Industries (and Countries)
The global gaming market is worth just shy of $140 billion and is growing year on year. But it goes much deeper than that as it also influences other sectors, from computing to gambling (which, in turn, influences the hospitality sector).
From online cricket betting and freemium games, to huge gambling companies and the brands that own them, this sector earns hundreds of billions, generates millions of jobs, and has a massive impact on every global economy. The online gambling industry is worth over $51 billion, and the casino and betting industry is worth over $110 billion. If we combine these with the gaming industry, which works in perfect sync with the gambling industry, then the total figure is over $300 billion, which is roughly the same size as the GDP of Pakistan, one of the 50 richest countries in the world.
One Game Makes over $1 Billion a Year
World of Warcraft is rarely mentioned in the same breath as the likes of Grand Theft Auto 5 when discussing the biggest selling games, because “only” around 15 million copies of the game have been sold and those games were not sold at full price. However, WoW, as it is often known, is a subscription based game and all users pay either monthly (as is the case in the US and Europe) or hourly (as is the case across Asia). WoW is said to have over 10 million subscribers and it has been at these heights for a number of years now, putting their profit at over $1 billion a year. And this is before we even factor in the players who purchase the game itself, the expansion packs, and all of the merchandise and in-game currency that goes with it.
WoW was launched in 2004 and has had millions of subscribers since the beginning, with a boost every time there is a new expansion pack that increases the game world. For comparison sake, let’s compare this to one of the world’s biggest film franchises, Jurassic Park. If we focus just on the box office sales (it’s only fair, considering we’re also limiting WoW’s finances to its subscriptions) then it makes an average of $600 million per film (Jurassic World was $1.6b, but Jurassic Park III drags the average down with just $365m), released every 4 years. This means that its making $150 million per year in box office sales—nowhere near WoW.
Mobile Games Make Astonishing Amounts of Money
Mobile games are bucking the trend for big budgets and huge production cycles. They are being created by small teams on small budgets and tight deadlines. But despite this, they are still making a lot of money and most of that is profit. Flappy Bird is a great example of this. It was a short-term fad that everyone wanted a piece of. It was a quick, easy and cheap game and the developers made small amounts per download/play, but at the height of its popularity those “small amounts” were adding up to $50,000 a day.
On the other side of the coin you have developers making games that reward in-app spending, such as Clash of Clans. They pump all of their money into advertising, and they are rewarded with huge profits. In the past, a devoted player who was obsessed with a game would pay no more than the $50 or $60 ticket price, maybe another $50 or so if they wanted a peripheral such as a wheel or gun. These days devoted/obsessed players are willingly losing thousands. One story reports that a player from the Middle East lost over $1 million and the internet is awash with stories of addicted players losing their life savings.
The days of developers getting no more than $50 out of a player are long gone, and we’re now living in an age where one player can pay more than entire video games have been known to make. That’s the bad side of the gaming industry, but it’s great news for the developers and it also helps to pump more money into this flourishing sector.