Cloud Gaming’s 21.7 Million Paying Users Helped the Market Generate $1.5 Billion in 2021; These Yearly Revenues Will Quadruple in 2024
We’re happy to announce that we’ve just launched a huge update for our Global Cloud Gaming Report subscribers. This article will present some high-level data and insights from that update.
Cloud gaming has reached an inflection point. The tech has proven itself viable, paving the way for the market to enter a new stage of adoption and growth.
We estimate that 21.7 million paying users of cloud gaming services spent $1.5 billion on cloud gaming services in 2021. The future is even brighter. In 2024, paying users will almost triple (to 58.6 million) while revenues will quadruple (skyrocketing to $6.3 billion).
That’s our base scenario, but the full Global Cloud Gaming Report subscription also includes pessimistic and optimistic scenarios, reflecting on the different ways this nascent market might evolve.
The full report subscription also boasts insights and forecasts on crucial cloud gaming metrics like cloud gaming ARPPU (average revenue per paying user) and cloud gaming SOM (serviceable obtainable market — how many people cloud gaming can reach).
How did we get these numbers? Learn about the methodology!
The Cloud Gaming Ecosystem Is Bigger and Healthier than Ever
We’ve been tracking the cloud gaming ecosystem since 2019, and it’s now more robust and healthier than ever. Publishers big and small — and across multiple platforms — are now part of the scene, while others are looking to get involved.
The cloud gaming ecosystem diagram below shows the wide range of services currently available in the market, covering a variety of business models and offerings:
While you can see many familiar logos from large gaming companies, innovative independent cloud gaming providers are also making a name for themselves. Together, these companies are pushing the tech forward and expanding its reach and potential.
While you can see many familiar logos from large gaming companies, innovative independent cloud gaming providers are also making a name for themselves. Together, these companies are pushing the tech forward and expanding its reach and potential.
Ongoing Cloud Gaming Trends Are Shaking Up the Ecosystem
Via partnerships with local telcos, cloud gaming services now operate in growth markets across Southeast Asia and Latin America. These maturing games markets will continue to grow alongside cloud gaming, forming bonds that will pay off for cloud gaming’s long-term future.
However, there are plenty of other developments that we dive deep into in the full Global Cloud Gaming Report subscription, including the following cloud gaming trends:
- Hardware in the data centers is an important differentiating factor
Microsoft and NVIDIA upgraded the hardware their cloud gaming services run on. Cloud gaming players do not need to invest in expensive gaming hardware to play the latest titles, but service providers must keep up with evolving hardware (and consumer expectations). - Cloud gaming is coming to TVs
Tencent partnered with several TV manufacturers to add Tencent START on their TVs, NVIDIA partnered with Samsung and LG to bring GeForce NOW to new TV models, and more partnerships are on the way. - Small cloud gaming services are taking giant steps
While smaller firms may not have the same budgets as the large tech companies also investing in the market, their innovative approaches have led to quick successes. - The market is — and will continue — consolidating via M&A and investment
Larger companies will acquire smaller ones to quickly grow their footprint in the cloud ecosystem. The smaller firms benefit from brand recognition and access to more content, while the bigger firms benefit from smaller companies’ innovations and talent. - More huge media and entertainment companies will likely get involved
Netflix has been experimenting with adding games to its subscription. For now, users still have to exit the app — and enter mobile app stores — to access games. Cloud gaming removes that barrier, and media companies looking to add value to their services are taking note.
Perhaps a more immediate trend is that the market’s key stakeholders are reflecting on their pandemic-accelerated growth and are putting their next steps, innovations, and strategies in motion.
During the pandemic period, many cloud gaming value propositions have emerged or become more visible. To name just a few, cloud gaming’s use cases for gamers include:
- Experiencing high-end and supply-constrained gaming hardware for a fraction of the cost.
- Playing demo games in a subscription service before downloading them.
- Minimizing the download sizes of high-fidelity mobile games, saving precious storage space.
The full Global Cloud Gaming Report subscription analyzes all these trends in detail. In addition to the full report, we also send subscribers an analysis of the latest cloud gaming news and developments every six weeks.
Our Interviews with Cloud Gaming Companies Revealed Exciting Insights & Underline Why Cloud Gaming Is So Important
In our new update, we interviewed three companies — CareGame, Boosteroid, and Utomik. One throughline throughout all the interviews was cloud gaming’s biggest use case: accessibility and convenience.
CareGame’s Co-Founder and President, Benjamin Athuil said, “we want to give all mobile gamers access to the games they love — regardless of their smartphone, connection, or their budget. No one should be left behind. Gaming should not be reserved for the privileged. That’s our mission.’’
Boosteroid’s CEO, Ivan Shvaichenko, echoed this use case while also delving into some hospitality-based cloud gaming use cases:
“We have also partnered with a number of TV companies (the most recent deals have been signed with Philips and TCL) to enable PC games directly on TVs without consoles. Lastly, we are discussing B2B cloud gaming projects with hotels, airports, transportation companies, and many other potential partners that people may not think of when it comes to cloud gaming.”
Ricardo Scaini, Marketing Manager at Utomik, highlighted that cloud gaming’s expanded reach is directly beneficial for game companies:
“Both publishers and developers have been extremely excited to get this opportunity in bringing their games to a larger audience, on devices where most of them currently have little to no presence. It saves our partners a lot of work while granting them access to an ever-growing market. Many of the partners that we spoke to see this as the next logical step for Utomik and are excited for the possibilities.”
The full interviews show key insights into each company’s strategy, their expectations for the future of cloud gaming, what the future holds for them, and how they have overcome key obstacles.
Cloud Gaming Still Has Challenges to Overcome
Naturally, not everything is positive. We asked Utomik, Boosteroid, and CareGame about the biggest cloud gaming challenges they face. Capacity was at the forefront, especially walking the line between technical performance, flexibility, and cost.
A few companies struggled to walk that line, with a handful of early cloud gaming services having shut down. For example, Deutsche Telekom closed down MagentaGaming after it failed to hit internal expectations. Other companies facing similar challenges are pivoting their cloud gaming approaches.
Despite some early challenges and obstacles, the market’s future remains almost unanimously positive. Supply constraints are ongoing, 2022’s game release schedule is crowded and highly anticipated, and cloud gaming services are spreading to smart TVs, consoles, streaming sticks, and other devices.
Put simply, cloud gaming’s future is bright and is pivotal to the market as a whole.
Want to stay ahead of the competition and keep up with this exciting market? Look no further than our Global Cloud Gaming Report subscription, which is already helping the world’s biggest companies — within and beyond games — hone their cloud gaming strategies.
