Joost van Dreunen, CEO of research firm SuperData, tells us why the PC gaming market is booming, and how it is leading the way for the games industry
Today, industry and consumers alike fall over themselves to tell us about the booming future of mobile gaming and their predictions for the death of the console.
But there is one segment, that has been going mostly unnoticed: PC gaming. Historically, PC games have played a minor role at retail, representing between five and 10 per cent of sales on average compared to console. Moreover, as an open platform PC gaming is much more susceptible to piracy, forcing large publishers to stay wary of PC gaming and often delaying the release of major titles on the platform. The transition to digital gaming has changed all this.
First and foremost, last year the market for digital PC-based games was worth 17.3bn, larger than mobile's 14.5bn and certainly larger than digital console's 2bn.
How is this possible? Well, there are four digital game segments that live on PCs: social games, free-to-play MMOs, subscription-based MMOs and downloadable PC titles. For the UK, the PC-based games market was worth 741m, compared to 118m for digital console and 548m for mobile. The biggest growth over the past four years in addressable audience has been in social, which has
gone from 13m monthly active users to 31m last month, and free-to-play MMOs, which grew from 8m to 13m.
Now that digital distribution is starting to become a reality, PC gaming is once again worthwhile for risk-averse publishers. With an effective measure to combat piracy, publishers are able to make content available to a wider, more diverse audience and invest in innovation.
"Last year, the UK PC games
market was worth 741m,
more than the 118m digital
Joost van Dreunen, SuperData
And if there's one thing that defines subscription-based gamers, it is loyalty. In a hit-driven industry like interactive entertainment there is nothing more valuable than the ability to control cash flow and have predictable income. So it was no surprise late last year that Activision Blizzard's stock price shot up when it announced a rebound to 10m monthly subscribers for World of Warcraft.
It's good for audiences, too. To benefit the most from network effects and offer an optimal experience, successful MOBAs like League of Legends require relatively low hardware standards allowing everyone to join in.
In addition, the inventory is enormous. With over 4,500 titles on Steam, Valve is actively exploring ways to overcome the difficulty of connecting audiences with the content of their choosing. And, to be fair, PC games have proven among the most innovative and creative in recent years. Titles like Besiege and Cities: Skylines are hugely popular and reveal an even larger trend that will determine the shape of things to come.
One of the key things about PC gaming has been the freedom it allows. Compared to closed systems like consoles and mobile, people can customise their PCs and outfit them with whatever hardware they see fit. The software equivalent of this comes in the form of games like Minecraft, allowing a whole new generation of audiences to take ownership of the experience on the screen. Microsoft has already committed to this philosophy by acquiring Minecraft for a bone-crushing 1.7bn last year. And if this year's GDC was any indication, we're well on our to seeing VR finally become a reality. Playing in the 21st century has become synonymous with playing with the technology.
So, PC gaming is not only a prosperous and exciting market, it might also prove to be the future of gaming.