The MMORPG gaming market is expected to grow at a CAGR of about 9.5% during the forecast period of 2020-2025.
The rising craze of gamification among millennials has led to the creation of a virtual world for the video gamers, where they get a virtual economy, currency, trade environment, and real-time scenarios to deal with. With the help of gamification technology, the game developers successfully keep the gamers engaged in the role-playing games and also encourage them to stake more real money to receive the benefits or boosters over the games. This strategy has also facilitated the MMORPG game publishers and developers to generate more sales by retaining old players and attracting others to get involved in these games.
The growing internet penetration is accentuating the demand for MMORPG gaming around the world. The increasing number of people with access to the internet in developing economies such as Asia Pacific countries has grown enormously in the past few years due to the global expansion of Chinese consumer electronics manufacturers offering affordable smartphones, tablets, gaming consoles, and local government's investment in internet infrastructure. According to the data of GlobalWebIndex, it indicates that more than 1 billion people across the world now are interested in internet streaming each month. The latest statistics suggest that near to a quarter of all internet users, watch live streams of other gamers playing games each month.
The MMORPG games remain largely centralized and majorly dependent on the developer's willingness to support the game with updates. This centralization is significantly vulnerable to both attacks and outages. DDOS attacks are a common occurrence for the centralized server structure of these games. For example, Blizzard Entertainment, which is the creator of World of Warcraft, apparently one of the significantly successful MMORPG games, was the target of such attacks in recent days.
Blockchain technology, which offers a decentralized, Peer-to-Peer gaming environment, therefore, provides transparency, security, and, more importantly, is controlled by the gamers themselves. Blockchain technology's decentralized nature also has the advantage that no central game servers can be shut down or attacked at the developer's whim.
With the increasing data security breaches and cyber-attacks through MMORPG game servers are restraining the growth of the market. For instance, in May 2020, ESET, a security firm based in the Asia Pacific, published a report where they have mentioned the name of popular gaming companies who were majorly affected by build orchestration server, hijacking. The company has briefed that most of the gaming companies of South Korea have been affected by this increasing cybersecurity problems.
At the time of the COVID-19 situation, the increasing popularity of online multiplayer games is driving the growth of the market on the one hand. On the other side, owing to the lockdown situations across the world, the MMORPG gaming developers are facing the shortage of available skilled developers which therefore delaying the launch of new MMORPG games. For instance, in April 2020, Amazon game studios announced that their upcoming New World game would have a delayed launch in August or later.
Key Market Trends
Gaming Console Expected to Grow at a Considerable Rate During the Forecast Period
Players who prefer to use gaming consoles are likely to have a gaming subscription, and they have significant gaming utilization. More broadly, console gamers tend to value video streaming rather than traditional Pay TV. Console gamers also gravitate toward paid video streaming services for the games. In terms of influencing and reaching these gamers, video game advertising likely has a significant impact.
With the increasing adoption of esports, the rise of video games through consoles is growing and will show more growth in the coming years. As a response to this trend, connectivity and entertainment providers could target console gamers by offering console-related video services, like live sports, fast broadband, and monetizing the audience more optimally through OTT ad-supported services. Video gaming companies could offer premium-pricing for gaming subscription services, which could include access to esports events and original content.
Major companies are also focusing on the development of console-based games with high graphics quality, which therefore contributes to the growth of this segment. For instance, in July 2019, Amazon Game Studios announced the development of a new "The Lord of the Rings" game, coming to consoles. The company has entered into a strategic partnership with Leyou Technologies and Middle-earth Enterprises to develop this game.
Console developers are also focusing on the new product development to raise the bar of the competition in the market. For example, Microsoft is planning to launch Xbox Series X, which can face massive competition from the upcoming Sony PlayStation 5. These next-generation gaming console launches are likely to drive the segment's growth in the MMORPG market.
North America Holds a Significant Share in the Market Over the Forecast Period
In the past few years, the rise in gaming across generations in the United States and Canada has been dramatic and swift. In the United States, over 30% of consumers pay for gaming subscription services, and more than 35% play online video games at least once a week.
Presently, many entertainment businesses also acknowledge how MMORPG games, like Fortnite, which has attracted nearly 250 million gamers in less than two years, have become legitimate competitors in the market. In the North American gaming ecosystem, at the same time, the rising adoption of direct-to-consumer subscription services from technology enabling companies and Hollywood studios have created a competitive environment in the region.
When it came to the payment methods for the game and gaming feature purchases, gamers in the region were split closely between debit cards and credit cards, with PayPal holds a significant share. The major MMORPG games for spending features include many high profile games like Call of Duty, Fortnite, GTA, Final Fantasy, etc.
In the North American gaming ecosystem, major tech vendors are investing in online gaming, which further drives the market growth in the region. For instance, in May 2020, Amazon ramped up its expansion into the MMORPG gaming industry with the release of Crucible.
Google LLC is also opening its in-house gaming studio in Montreal, Canada, to develop games for its Stadia streaming service. Apple launched the Arcade subscription services, and Facebook has been strengthening its foothold in VR games with two significant studio acquisitions in 2020.
The MMORPG gaming market is fragmented in nature and comprises a large number of global and regional players. These players are majorly based in the Asia Pacific region and are focusing on expanding their consumer base. These gaming developers are investing more in the research and development activities to offer new solutions for gamers. The companies are also entering into strategic partnerships, and other organic & inorganic growth strategies to earn a competitive edge in the market.
In May 2020, Dreamside Interactive has planned to hit Steam early access of Frozen Flame, which is a new action MMORPG game developed by the company. The company is also currently running a crowdfunding campaign and has raised over USD 115K to fund the game's development.
In April 2020, Bright Star Studios, a developer of next-generation social MMORPGs, announced a USD 700K pre-seed investment by Play Ventures. The funding has done with participation from Galaxy Interactive through its Galaxy EOS venture capital fund. The company will use the investment to expand the team and accelerate the launch of its online games.
Key Topics Covered
1 INTRODUCTION 1.1 Study Assumptions and Market Definition 1.2 Scope of the Study
6 MARKET SEGMENTATION 6.1 Gaming Platform 6.1.1 Mobile 6.1.2 Tablet 6.1.3 Gaming Console 6.1.4 PC 6.2 Geography 6.2.1 North America 6.2.2 Europe 6.2.3 Asia-Pacific 6.2.4 Latin America 6.2.5 Middle East & Africa
7 COMPETITIVE INTELLIGENCE 7.1 Key Vendor Profiles 7.1.1 Activision Blizzard, Inc. 7.1.2 Electronic Arts Inc. 7.1.3 Ubisoft Entertainment SA 7.1.4 NCSOFT Corporation 7.1.5 Giant Interactive Group Inc. 7.1.6 Tencent Holdings Limited 7.1.7 Amazon Game Studios 7.1.8 Nexon Co. Ltd. 7.1.9 Jagex Limited 7.1.10 Bright Star Studios