Nikkei Asia magazine article on Nintendo's record profits and significant share price increase since the pandemic began. The article basically argues that Nintendo experienced this success because people who were stuck inside bought video games, specifically Nintendo's colourful and fantastical ones, to escape from the dreary reality of COVID-19 isolation. But once the lockdowns and restrictions end, people are going to abandon their video games to go back to more social activities outside their homes. 

What do you think? Is Nintendo, and the video game industry in general, experiencing a bubble that will burst sometime next year?

And what have you been doing in your free time during the pandemic? Have you been playing more video games?

 

Nintendo, and the video game industry in general, will have a before and after the pandemic that we are currently experiencing.The pandemic has plunged the travel industry into its worst crisis, has shaken Hollywood and has wreaked havoc on the sector restaurateur. What about video game developers? More than buoyant.

 

Stay-at-home people turned to consoles to ease the sadness of confinement by stealing cars, hunting zombies and planting trees in villages with talking animals. Industry sales in the United States in the second quarter increased 30 percent from a year earlier, to $ 11.6 billion, according to market research firm NPD Group.

 

Shares of Activision Blizzard rose 46 percent this year, Nintendo's profits increased fivefold from April to June, and the Roblox video game platform went from 115 million users in February to 150 million in July. Electronic Arts (EA), which is a developer of games like Madden NFL and FIFA, says it added "tens of millions" of new players during the pandemic.

 

"This is an unprecedented moment, and it was an unprecedented first quarter for our business," Andrew Wilson, who is EA's CEO, told investors on July 30.

 

The 'boom' has propelled what was already an extremely lucrative business. Video game companies are developing franchises like Hollywood does with sequels, but games can generate sales far greater than even the biggest movies, without the need to worry about hurting actors' fragile egos. "The biggest video games are much more profitable over time than any movie ever made," says Matthew Kanterman, an analyst at Bloomberg Intelligence.

 

In times of coronavirus, at least one player has dared to take on the tech giants. Epic Games Inc. is fighting Apple and Google for the 30 percent commission they collect from sales of games on their platforms. Epic notes that the commission, which was born in Japan in the 1980s and the era of cartridges and primitive consoles, is outdated and unfair. Its Fortnite video game, which generates more than a billion dollars a year from sales of bonus items within the game, has given players the option to purchase add-ons outright. Which leaves Apple and Google out of the party, which in response removed Fortnite from their app stores.

 

Even before the pandemic, 2020 was already looking to be a year round, with a stellar lineup of titles. And this fall, Sony and Microsoft will launch their powerful next-gen consoles, PlayStation 5 and Xbox Series X, which promise richer graphics. For gamers, that's a big deal, as these generational leaps happen only once every seven to eight years, so they will shape the gaming landscape for the next decade.

 

Sony will continue its strategy of exclusive games like The Last of Us Part II, a post-apocalyptic action thriller with film production quality that has filled the void left by closed cinemas. Microsoft bets on Xbox Game Pass, a subscription service that is like the Netflix of video games, offers access to hundreds of titles for installments of $ 5 to $ 15 per month. That's good for the software giant, because the next installment in its Halo franchise has been delayed, leaving the new Xbox without a flagship attraction. "Microsoft is aware that the most effective weapon in its arsenal is the Xbox Game Pass," says George Jijiashvili, an analyst at research firm Omdia who expects Sony's new console to outsell Microsoft's. "If they can't compete in hardware sales, they have to compete in other areas."

 

Yet even though the industry ranks among the most coveted places to work these days, many game developers feel exploited and discriminated against. Across the industry, coders and designers describe a cult mentality and hostility towards women. Working nights and weekends with little or no additional compensation for weeks or months remains a systemic problem. And the industry still accepts the employment of "permatemps," people who work alongside full-time colleagues but lack benefits and job security.

 

While it is undeniable that game developers have thrived on the pandemic, it has affected productivity and will slow the arrival of titles starting this fall and into 2021. With work-at-home mode, nearly half of developers say who spend more time in front of their screens but do less, according to a July survey by the Game Developers Conference. And a third of those surveyed said the coronavirus had delayed some titles, in addition to Halo Infinite, dozens of releases have been postponed. If the delays continue to extend and the recession hits the consumer's wallet, the optimistic mood could give way to a more somber one. "Uncertainties and unknowns could compete with a Tolstoy novel," says NPD analyst Mat Piscatella. "We have the pandemic, the elections, the unemployment, and the list goes on and on."

 

 

The confinement and social distancing imposed by the Covid-19 pandemic in almost the entire world has triggered the consumption of video games and related content.

 

A dramatic situation that nevertheless benefits a sector that, in general, "is not only not being harmed, but is even growing notably," Álvaro Luzón, business development manager of Antevenio Shakers, tells Economía Digital.

 

According to Álvaro, this growth occurs in practically all areas of the industry: more games and related products are sold - such as video game consoles and computers - and the consumption of content associated with video games also increases.

 

"Twitch, the main platform for live content (streaming), has grown 31% in the last two weeks of March," says Álvaro. "People who were already consumers of content on platforms such as Twitch, YouTube, Mixer or Facebook Gaming are now spending more time. New users are also entering due to fewer entertainment options," he adds.

 

Video games to entertain and socialize

In addition to being an option for entertainment, video games are also showing their social benefits. People living together during confinement can play and have fun together, and multiplayer games allow you to play remotely with friends and other players, while chatting and chatting.

 

In recent weeks, the WHO has defended the benefits of video games, and recommends their use to promote training and socialization during confinement.

 

This widespread adoption of videogames together with the arrival of more casual gamers - and now also circumstantial players - is "invalidating the stereotype of the player," they say from the ISFE (Interactive Software Federation of Europe).

 

Currently more than half of the European population, 54% or about 250 million people, play video games more or less frequently, and the distribution is almost equal between men (54%) and women (46%). The adoption of video games is growing especially in the population between 25 and 34 years old, one of the groups that makes marketing departments salivate the most.

 

"It has never been more important to keep people entertained and connected from the safety of their own homes," they say from ISFE. "The video game industry is uniquely positioned to encourage and help people around the world to stay home, stay safe, and protect others."

 

 

Probably after the pandemic ends or it is necessary to return to regular activities before confinement, the demand for the use of video games will decrease a bit, however we are in a time where most of the activities have to be carried out with the use of technology .

 

Video game sales have reached a record sales level in March, due to the social distancing measures that world governments have taken against the coronavirus epidemic.

 

Experts in the video game market confirm that the coronavirus pandemic has been a determining factor in the increase in sales. According to Andrew Little, an analyst at Global X, consumer spending on video games increased 65 percent in mid-March, compared to the same period in 2019.

 

Nintendo is one of the video game companies that has benefited the most from the coronavirus pandemic. The "Animal Crossing: New Horizons" series for the Nintendo Switch, which just went on sale on March 20, sold more than 1.8 million copies in its first three days of release in Japan.

 

While the new game "Doom Eternal", developed by id Software for platforms such as PlayStation 4, Nintendo and Xbox One, also recorded its best weekend in sales than any other version of the game. "Call of Duty: Warzone", developed by Infinity Ward and Raven Software, is another of the titles that were released in March. Ten days after its launch, it already had 30 million registered players, making it the fastest growing non-mobile game.

 

Online gaming services are also experiencing an unprecedented boom, especially video games with social elements that allow you to stay connected with friends and have fun even without meeting in person.

 

However, analysts say we still have to wait to visualize the true long-term impact of the coronavirus on the video game industry, as although online sales have risen, store closures and physical sales losses cannot balance. Internet sales.

 

Millions of people seek out social distancing activities to stay entertained during home quarantines. Video games can promote mental well-being by connecting people at a distance, providing communities where people feel they belong, and helping people recover from stress and anxiety.

 

Additionally, video games can improve mental health during the pandemic. Regan Mandryk, a computer scientist at the University of Saskatchewan, says: "We don't have any control over what's going on in the world right now, and that's causing people stress. Right now, as people are socially isolated, they are turning to games to self-manage their need for social contact. It is about regaining control of our own well-being ".

 

 

In general, video game sales have increased as a result of stay-at-home and lockdown ordinances due to the pandemic, as people turn to video games as a hobby.

 

With many people around the world at home and unable to work, online gaming has recorded a record number of players during the pandemic as a popular activity to counter social distancing, thus increasing the revenues of many gaming companies and platforms. during it.

 

The pandemic is accelerating existing trends in the gaming industry. For example, Steam, the leading digital video game store for personal computers, registered more than 23 million simultaneous players during March 2020, beating all previous records, while the streaming service Twitch, registered more than 3 billion hours of content viewed during the first quarter of 2020, representing a 20% increase over the previous year. Microsoft reported a substantial increase in users of its Game Pass for Xbox service in the months of March and April 2020, bringing it to more than 10 million subscribers.

 

Video game use during critical hours increased by 75% as citizens were encouraged to engage in social distancing and self-isolation, according to a new Verizon report published March 17, which looks at phone usage habits. data. That compares with a 20% increase in web traffic and a 12% increase in video usage.

 

Comcast data shows new game downloads have increased by 80%, compared to an increase of "only" 50% in total game downloads

 

The increased interest in games may accelerate a shift - already underway - toward distributing games via mobile and cloud-based platforms. The industry clearly sees the potential of this distribution model. For example, cloud games allow consumers to play streaming games across devices, often without the need for expensive hardware.

 

The second long-term trend is the expansion of monetization channels through subscription and free play models. Subscriptions offer a reliable avenue for monetizing smaller, quality games. On the other hand, free games allow developers to monetize without having to convince consumers to make purchases in advance. Instead, they offer in-game sales opportunities such as upgrades and expansion packs.

 

To take advantage of these trends, our team of Starloopianos can help you develop video games that give the experience you are looking for.

 

From my point of view The pandemic has reminded video game companies and brands that there is still an accessible market of very interested consumers. COVID-19 is an example of how a "crisis" can turn into an opportunity and how it can push towards development and innovation.

 

Since all people's activity has moved to their own homes and they spend more time playing video games, it is wise to offer them what they are looking for: a method of relaxation through video games.

 

From game concept creation to post-release support, our team at Starloopians dedicate their knowledge and experience to developing addictive and fun-to-play games.