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. In its latest “Global Cloud Gaming Report,” Newzoo estimated that 21.7 million paying users of cloud gaming services spent US$1.5 billion on these services in 2021. In 2024, paying users will almost triple (to 58.6 million) while revenues will quadruple (skyrocketing to US$6.3 billion).
Newzoo has been tracking the cloud gaming ecosystem since 2019. However, according to the insights and analytics company, it is 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 report noted that, via partnerships with local telcos, cloud gaming services now operate in growth markets across Southeast Asia and Latin America. According to Newzoo, these maturing games markets will continue to grow alongside cloud gaming, forming bonds that will pay off for cloud gaming’s long-term future.
Hardware in the data centers is also 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).
The report also forecasts that more huge media and entertainment companies will likely get involved. Netflix, for example, 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.
“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,” the report concluded.