Malcolm Owen
Apple is the fourth-biggest public gaming company in the world, according to a report by analysts at Newzoo, with the continued rise of mobile gaming and its operation of the App Store helping the iPhone maker beat other games industry mainstays, including EA and Nintendo.
In its Global Games Market Report, Newzoo outlined the top 35 public companies connected with gaming, with Apple firmly seated in the top five firms, beaten only by Tencent, Sony, and Microsoft and just ahead of Activision Blizzard. According to the report, the top 35 public game companies generated $114 billion in 2018, up from $100.2 billion in 2017.
While the top 35 companies accounted for 82% of the global games market revenues for the year, an identical proportion to 2017's figures, the top five accounted for 43% of revenue collectively.
Apple is said to have earned $2.09 billion from gaming for the first quarter of 2018, then $2.30 billion, $2.52 billion, and $2.54 billion in successive quarters. For all of 2018, Apple's gaming revenue is claimed to be $9.45 billion, a year-on-year increase of 18% from 2017's total.
The App Store operator could have achieved third place on the list, but while Microsoft was slightly behind in the first three quarters in terms of revenue, it surged in the fourth quarter resulting in a revenue for the year of $9.75 billion, up 32% year-on-year. Even so, it has a long way to go to beat out the first-place Tencent, which enjoyed revenue of $19.73 billion and 9% year-on-year growth.
For the industry as a whole, mobile gaming continues to be the biggest segment in the report, making up 45% of the global games market and generating $68.5 billion in revenue. Smartphone-based games bring in 80% of revenue, or $54.9 billion, while tablet gaming accounts for the remaining $13.6 billion.
Mobile gaming is set to continue to outpace PC gaming for the next few years due to a shrinking PC market until 2022, Newzoo suggests. It is also tipped to grow faster than console gaming, and to erode browser game revenues by 15% per year.
Apple also stands to benefit from its own initiatives to generate more revenue from consumers, such as the incoming Apple Arcade, which will provide access to a selection of titles for a monthly subscription, rather than relying on a cut of microtransaction fees the company currently receives from many top App Store titles.
The App Store is already providing developers and publishers more revenue than its Android equivalent, with one recent Sensor Tower report suggesting iOS apps earn 64% more revenue than Google Play.
Neozoo's revenue data stems from its "predictive games market model" which incorporates macroeconomic and census data from the IMF and the UN, transactional and app store revenue data from partner Priori Data, primary consumer research, and financial information reported by public companies. Hardware dedicated to games, like consoles and handhelds, are included in revenue, but devices like the iPhone and iPad are not.
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12 Comments
Lets hope the get real serious once their gaming subscription launches and now that real game controllers are available for AppleTV
The comparison makes no sense. EA and Nintendo are making and selling their own game software. Apple is only selling the games of others. Is Apple more profitable? Yes.
Whether Apple Arcade has any impact remains to be seen... that will depend on whether the games are compelling or not.
IMO, the big change will be the controller availability and further adoption of existing popular games in the market being played on iOS, or ported to iOS.
I'm still trying out Apple's $10 monthly News service. The news sources are iffy, and the News app stinks worse than iTunes, but I'm sticking with it for now because it will probably get better. Similarly I'm willing to try Apple Arcade, and I'm not expecting much at the beginning of that either. But it may be worth it in time.
I downloaded the report. It's silly. The rankings make very little sense unless you're using an extremely broad definition of "gaming company" that includes slot machine manufacturers. Newzoo bundles joint game console manufacturers and publishers (Nintendo, Sony, Microsoft) in with companies like Apple and Google, which at best curate games that are played on their generally non-gaming hardware and services; companies that exclusively publish/develop games (Tencent, EA, Ubisoft) and make no hardware at all; companies that sell gambling and slot machines (Aristocrat Leisure); and Japanese social media companies that have published freemium games (Mixi, GREE). They also include Century Huatong, which according to Bloomberg, is a company that "engages in the auto parts and Internet games business," and "manufactures and sells plastic parts and associated molds for vehicles, such as heat exchange and air conditioning plastic parts." I'm not sure I would consider Zhejiang Century Huatong and Nintendo to be similar in many ways, if any. The only common denominator for many of these companies is that they're publicly traded and they have done or published something using the word "game." Coincidentally, several of these companies are also customers of Newzoo!