By Sam Acosta
As we venture deeper into 2022, it seems that we may finally be past the final throes of the COVID-19 pandemic. Restaurants and stores are opening back up, people are beginning to gather together again and movies are starting to steadily release again. When it came to the entertainment industry, the pandemic hit hard, as movie studios and theaters struggled to make enough profit to survive.
In 2021, the global box office amounted to an estimated $21.4 billion in revenue, which is nearly half of the $41 billion in revenue that was made in 2018 before the pandemic hit. This kind of loss can be seen in almost every facet of the entertainment industry, except for one.
In 2021, the video game industry managed to earn a staggering $180 billion in revenue, a substantial increase from the $155 billion earned the previous year. Video games have silently dominated the entertainment industry for years now, having made just under $146 billion compared to the $62.7 billion brought in by both the movie and music industries combined in the first year of the pandemic.
“Minecraft” alone, a popular sandbox video game from Mojang Studios, has made over $3.1 billion in sales revenue with an additional $449 million from mobile sales. This greatly outperforms “Avatar,” which is the highest-grossing movie of all time with a total revenue of just over $2.8 billion. Yet, despite this extreme influence, it seems like the video game industry has only just started to receive the credit it deserves.
This might be due to certain stigmas surrounding the medium. One stigma that, until recently, seemed to color popular opinion was that video games were for kids only. The idea of an adult playing any kind of video game seemed immature. This idea is slowly phasing out, however, as playing video games has become more and more popular. The Entertainment Software Association released a report last year that stated approximately 67% of American adults play video games, the highest percentage of all time.
A large number of factors may carry into this. Video games have been proven to help relieve stress and provide a way to interact socially with other people. There’s also a potential connection between parents and video games. Another report by the ESA stated approximately 57% of parents play some form of video game with their children at least once a week.
As generations that grew up with video games are becoming parents, their continued interaction with that kind of entertainment as both a form of engaging with their kids and a personal outlet for stress relief may be affecting its growing popularity.
So it’s no surprise that, as gaming’s popularity grows and as the industry continues to make record amounts of revenue even during a financially crippling pandemic, people are starting to take serious notice. Large amounts of money are now being poured into the industry by companies trying to get their foot in the door.
Microsoft has made giant steps into gaining assets in the field, recently paying $69 billion for Activision Blizzard, the massive video game studio behind the cash-cow “Call of Duty” franchise. With the release of its “League of Legends” tie-in series “Arcane” earlier last year, Netflix recently began a push into gaming, hoping to revolutionize the market. As co-CEO Reed Hastings recently said in regards to their entrance into the gaming world, “Let’s nail the thing and not just be in it to be in it.” The most recent move of this kind would be Facebook’s rebrand to Meta, pushing the company toward the virtual future in which gaming will play a large hand.
There’s a great risk with gaming coming more into the public eye, however, and we are already beginning to see the effects of it. One of the most worrisome aspects of the entertainment industry as a whole is the dangers of extreme consolidation.
Within the past few years, we’ve seen a lot of evidence of this, as Disney has seemingly started to swallow giants, and other companies are scrambling to acquire assets of their own, all of whom are starting to market their products with stamps of exclusivity. This has led to the creation of countless subscriptions that we are required to buy in order to fully enjoy everything we might want to see: Netflix, Amazon Prime, Disney+, HBOMax, Peacock and so on.
As mentioned earlier, Microsoft began this trend within the gaming industry by acquiring Activision Blizzard. This huge deal prompted Sony, one of Microsoft’s biggest competitors, to acquire Bungie, the studio behind the hit “Destiny” series. While nothing has been mentioned yet about whether these acquisitions will be followed by exclusivity claims, the threat is hanging in the air. If those threats become a reality, then gamers will be put in a difficult position. The danger of exclusivity and consolidation in gaming is slightly different than that of streaming services. With streaming, you can cancel and start subscriptions as you please, giving audiences the option to “subscription-hop” from service to service to view the content they desire without having to pay for them all at once.
This is impossible, however, when it comes to gaming. If the exclusivity war begins, gamers will have to choose what side to join, as most can only afford to buy one console every few years. This will divide gamers and hurt the very culture of gaming, which is so heavily focused on community and shared experience that sectioning off those individuals and their experiences could cause irreversible damage.
So while the video game industry is in a position to become the entertainment medium of the future, it is not without risk. It will only take a few greedy eyes looking at the revenue statistics to start a chain reaction that could tarnish the industry. The next few years, and perhaps even months, will shape where gaming will stand in the future. The stakes are almost as high as the possibilities.
Sam Acosta is a Junior Theatre Comprehensive Major and the Arts and Entertainment Editor for Cedars. He likes spending his time watching movies, drinking Dr Pepper and writing plays.
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