Jul 9, 2018, 9:25 PM ETConference Presentation, Panel

Gaming Breaks Into the Mainstream

The global video game market was valued at $138 billion in 2018, with a projected growth to $180 billion by 2021.
Grand Theft Auto V is the single most successful entertainment product by pure game sales, having generated $6 billion in revenue from 90 million units sold.
In contrast, the Star Wars franchise has generated approximately $4 billion, though its total value is significantly higher when including licensing, merchandising, and theme parks.
Maple Story, a free-to-play title by Nexon, has generated over $8 billion in revenue over eight years of operation.
Mobile gaming currently accounts for 51% of the total $138 billion market and is the primary driver for reaching the next billion gamers, particularly in emerging markets like Vietnam (12% annual mobile penetration growth) and India.
Facebook Messenger and WeChat are identified as critical distribution platforms for accelerating mobile game adoption.
Android is projected to become the single biggest gaming platform due to the explosion of mobile devices in developing markets.
HTML5 technology is cited as a key enabler for delivering lightweight games to low-spec devices and poor network connections.
Arena Valor reported 300 million monthly active users, illustrating the scale of successful mobile titles.

Frank Sokey (Intel) argues that while Virtual Reality (VR) and Augmented Reality (AR) experienced a "hype cycle" downturn, they represent a "once-in-every-20-year" transformation in computing interaction, similar to the shift from text to graphical interfaces.
Intel's investment thesis for VR relies on three pillars: compelling content, immersive architecture (cloud, edge, 5G), and an audience that interacts socially like non-player characters.
Peter Levin (Lionsgate) remains bullish on the long-term potential of VR/AR but is bearish on the near-term commercial timeline for home-based adoption due to spatial constraints (10x10 feet required).
Lionsgate's strategy prioritizes location-based entertainment (LBE) and collaborations with retail and theater chains over investing in standalone VR production entities.
The release of the $199 Oculus Go standalone VR headset is seen as a positive step toward mainstream adoption by removing the need for external PCs.
Frank Sokey notes that immersive VR workloads place significant pressure on data centers, graphics performance, and network infrastructure, driving demand for edge and 5G solutions.

Boombay Games partnered with Special Effects to create accessible controllers (e.g., chin controls) and the free software "iMine" for playing Minecraft, aiming to assist patients in hospitals and hospices.
The "Nevermind" game utilizes biofeedback via Apple Watch and webcams to help users manage anxiety and PTSD through heart rate and facial recognition monitoring.
Emily Greer (Congregate Games) highlights that accessibility research often yields broad industry benefits, citing Nintendo's Wii controller as an example of technology designed for disabilities that revolutionized mainstream gaming.
Matthew Milken (Nevermind) and the panel discussed the "multiplier effect" where accessible gaming allows families to engage with disabled members, enhancing community inclusion.
A collective of 80 mobile developers donated their UK revenue to disability initiatives on September 29.

The panel identified online toxicity as a pervasive issue in gaming subcultures, exacerbated by anonymity and group dynamics, which can deter new players.
The Fair Play Alliance, including publishers like Riot Games and Epic Games, was formed to share data and best practices for encouraging positive teamwork and filtering out griefing.
Frank Sokey suggested that the shift toward live streaming (e.g., Twitch, YouTube) reduces anonymity, making toxic behavior more easily call-out-able and accountable by communities.
Emily Greer posits that games offer a unique opportunity to reshape online culture by experimenting with incentives and feedback mechanisms that might be harder to implement on general social media platforms.

The industry is shifting from a "hits-driven" fear model to a recognition of long-term "Games as a Service" (GaaS) lifecycles, where titles like World of Warcraft, Pokémon Go, and Candy Crush remain profitable for decades.
Investors are increasingly diversifying into infrastructure, platforms, and "picks and shovels" (tools, engines) rather than individual game titles to mitigate the volatility of hit-based revenue.
Crowdfunding platforms like Kickstarter and Fig allow gamers to co-invest, validating game concepts before production begins.
The Overwatch League is cited as a model for successful eSports investment, combining gaming DNA with global sports operational expertise, licensing, and merchandise strategies.
Blockchain and cryptocurrency are identified by Tim Sweeney (Epic Games) and panelists as potential building blocks for the "metaverse," specifically for securing cross-platform transactions and intellectual property rights.
Democratization of development is driven by accessible tools like Unity and AWS, allowing small teams (e.g., a one-person Adventure Capitalist) to create global hits, though monetization and user acquisition now require massive advertising budgets.
Tencent is highlighted as the primary centralizing force, holding minority stakes in Activision, Epic Games, Riot, and Supercell, creating a complex tug-of-war between centralization and democratization.

Untapped markets in the Middle East, North Africa (MENA), and Africa show high appetite for gaming, with Saudi Arabia noted for exceeding expectations in Overwatch consumption.
Altered Ventures is a new VC firm specifically targeting game projects in emerging markets.
The consensus is that gaming is becoming a universal behavior, extending beyond entertainment to education (e.g., Kahoot for schools) and corporate onboarding.
Engagement metrics show millions of daily active users playing for hours daily, indicating gaming's profound integration into modern social and cultural life.
The panel concluded that the convergence of diverse forces—democratization vs. centralization, mobile growth, and new interaction models—creates a positive outlook for the industry's continued expansion.