It looks like Microsoft was right to emphasize streaming and cloud-based services.
Microsoft has been pushing for cloud and streaming services in the gaming industry, and it looks like they might be moving in the right direction. In a report given by analysts Michael J. Olson and Yung Kim for Piper Jaffray, video game revenue will probably be entirely digital by 2022.
They stated, “We believe it is a certainty that video games will be ~100% digital in the coming years, and while exact timing is hard to pinpoint, we think 2022 is a realistic expectation.” I
n the report, the analysts also predicted that margins for publishers would also be significantly higher once video game revenue is mostly digital. Additionally, this would also mean that there would be a greater emphasis on subscriptions and streaming services which would lead to a higher recurring revenue for video game publishers. Overall then, it looks like Microsoft is moving in the right direction and we’ll have to wait and see if other companies also go down a similar route.
What do you think? Let us know in the comments.