Metaverse in Gaming Market

Metaverse in Gaming Market Size - Worldwide

The Metaverse in Gaming Market was valued at $22.7 billion in 2023. Over the course of projection period, the Metaverse in Gaming Industry is anticipated to increase at a CAGR of 39.3% in between 2023 to 2028 to reach over $119.2 billion in 2028. Surge in virtual world immersive interactive gameplay experience in the gaming metaverse market, upsurge in AR, VR, devices demand globally, emerging, and profitable opportunities from adjacent markets such as Extended Reality, Mixed Reality, brand promotions using gamification strategy and virtual world 3D simulators, are few factors which are expected to be the major driving forces in the growth of the Metaverse in gaming Market.

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Recession Impact on the Global Metaverse in Gaming Market

The virtual world gaming industry in North America is worth more than music and film combined (the entertainment industry) and shows no sign of stopping; and by 2026, it should reach USD 326 billion in value, according to a PwC survey. According to the EY Gaming Industry Survey report, considering the product side, half of the Nordics executives surveyed (precisely 53%) responded that they are prioritizing investments in VR, AR, and MR experiences. The survey conducted was also aimed at measuring the impact of a recession on the metaverse in gaming industry wherein respondents belonged to practices such as e-sports, gaming accessory manufacturers, gaming distribution, gaming hardware, gaming platform company, gaming publisher, gaming studio, and semiconductors/chip manufacturers. In July 2022, Dubai’s new metaverse (with a gaming focus) strategy was designed to add USD 4 billion to the economy which would result in 40,000 new jobs over the next five years. Overall, it is estimated that the gaming metaverse will inject USD 15 billion into GCC (Gulf Cooperation Council) economies by 2030. The metaverse in gaming industry is forecasted to contribute a whopping USD 2.4 billion to the economy by 2030; the contributors will be Bahrain, Qatar, Oman, the United Arab Emirates, Saudi Arabia, Dubai, and Kuwait (members of the GCC). Meta is investing more than USD 1 billion in programs that support creators (game developers) on metaverse platforms and help them succeed in the Middle East, North Africa, and Turkey. This region is profoundly working, with an eye on technical aspects, on long-term NFT projects to tackle a recession technically in the long run.

Metaverse in Gaming Market Growth Dynamics

Driver:  Brand promotions using gamification and virtual world simulators

Many companies, especially from the retail and gaming (entertainment) industry, are taking advantage of the gaming part of the metaverse. They are strategically using metaverse in gaming to engage in metaverse-based promotions and sponsorships. These companies capitalize by gamifying their brands through immersive online experiences and virtual world simulators. Some of the metaverse in gaming projects that gamify brand awareness include Reactland by Nike, Inc. (US), MagicBand+ by Disney (US), Mobility Adventure by Hyundai Motor Company (South Korea), and Gucci Garden by Gucci (Italy). People engage in these 3D worlds to play mini-games, connect with other gamers, socialize, make friends, and get product information through salespeople, chatbots, or virtual AI agents. Metaverse in gaming makes brand promotion interesting and engaging for young customers. Therefore, it is expected to drive the market during the forecast period.

Restraint: Regulating metaverse in gaming with respect to cybersecurity, privacy, and usage standards

Security and privacy issues are the major challenges the VR, AR, and MR industries face. These issues have emerged due to inconsistencies in programming and negligence and oversight of the developers and end users of apps and devices. With the increased amount of sensitive data being collected from players, data breaches, unauthorized data access, and data misuse become significant threats/obstructions. For instance, with whom a user speaks, what someone chooses to play and indulge in which virtual world game live-streaming, how much attention each user pays to an advertisement, or a specific immersive game basis genre, and few more. Additionally, it can even obtain extremely personal details, such as the way an individual virtually with its digital character or Avatar walks, talks, breathes and, perhaps, brainwave patterns could be collected in order to have a far better grasp on people's mental processes and behaviors. Gaming metaverse users ought to be logged in for long time periods, which means that their behavioral patterns will be continuously tracked and collected.

With reference to the applicability of the General Data Protection Regulation (GDPR), an obvious question arises, if the current data protection framework is adequate and sufficient to regulate how personal data is processed in the gaming metaverse. Moreover, determining the GDPR's territorial application is an issue in itself (when the entities are not based in the European Union [EU]), since it depends on the location of the end-user/gamer when personal data is processed.

Opportunity: Significant growth opportunities despite possible economic slowdown

The pandemic outbreak has hastened the evolution of the internet, resulting in the metaverse, where cyberspace has become more of an interactive 3D space with business and networking, as well as content that corresponds to the worlds in popular games such as Roblox. Playing in the metaverse allows gamers to meet new people and expand their social circle as well as have portable live-handling-virtual-play gaming assets, such as avatars and weapons, that are associated with players and have value in virtual settings. The increased popularity that the gaming category is witnessing in different virtual worlds such as Sandbox and Decentraland, is likely to grow with the advancement in technology and the fast-expanding user base in the 3D gaming sector. Moreover, the live streaming of games in the metaverse with more users jumping on the bandwagon will also help gaming companies to intensify their penetration to set new benchmarks for growth and profitability in the virtual worlds.

Challenge: Regional government regulations coupled with environmental impact

Metaverse in gaming is supported by adjacent technologies, primarily cloud computing (cloud gaming), blockchain, and XR. These technologies require high computing powers and storage, which has resulted in the ever-increasing need for data centers and computing equipment, such as storage hardware, cooling components, networking cables, GPU, CPU, and bandwidth. Further, the blockchain plays an important role in the functioning of the metaverse, which is backed by cryptocurrency mining and the heat generated by crypto mines housed by thousands of graphics cards. VR technology and data centers use AI and cloud services, which require quite a bit of energy. Running and maintaining such an infrastructure requires a lot of energy and power. All this collectively impacts the environment directly or indirectly. According to Data Quest, metaverse in gaming could lead to an influx of greenhouse gas emissions. Cloud gaming, a primary part of metaverse in gaming and XR, could also raise carbon emissions significantly over the next decade if not controlled. The evolution of technologies, such as 4K and 8K, is also witnessing the rise in the streaming of hi-resolution videos and images, which only increases the need for more energy. Such factors are expected to hinder market growth. However, mass recycling of e-waste, emphasis on buying second-hand electronics, and streaming in standard definition are possible ways to reduce greenhouse emissions caused by metaverse in gaming.

By component, the software segment to hold the largest market share during the forecast period

The software includes gaming engines, 3D modeling and reconstruction tools, volumetric video tools, geospatial mapping software, metaverse platforms, and financial platforms. A game engine is a software development program or environment used originally to develop video games. Now, a game engine can also be used for visualization (as with the development of digital twins), collaboration, and more. The features of a game engine may include animation tools, artificial intelligence, physics and collision engines, audio engines, and more.

Social media and video game companies are at the center of the metaverse's capability that leverages their vast user bases, interactive digital events, creation platforms, and hardware to build the foundation. NFTs facilitate the concept of play-to-earn (P2E) in the metaverse. Metaverse-ready gaming applications can use NFTs to build in-game assets with real-world value. Players who earn these NFTs through gameplay can later cash them out for real money. The value of the NFT would increase with time as more people start playing the game and want to own a piece of it. You can then trade or sell your NFTs to gain more money.

By software, Extended reality software segment to hold the largest market share during the forecast period

Several extended reality software includes AR and VR web app development tools, AR and VR mobile app development tools, AR and VR studios, Software Development Kits (SDK), and cloud-based tools. The extended reality software market has witnessed high growth in recent years and is set to witness significant growth during the next five years. Mass consumerization is anticipated to help achieve widespread adoption of extended reality software globally. Software Development Kits (SDK) are sets of software development tools that allow the creation of applications for specific software packages, software frameworks, hardware platforms, and operating systems. Several AR, VR, and MR applications are available in the market for Android and iOS, while a few of them are iOS specific.

SDK provides tools to design, create, and test AR, VR, and MR experiences. They act as building blocks to create training simulations, marketing experiences, and mobile apps. These kits offer tools to carry out cloning functions and add and move 3D objects. SDK also offers flexibility to non-developers by providing them with dragging and dropping tools to customize users' experiences. These kits can be integrated with operating systems and hardware to display VR. The key SDKs available in the market are Apple’s ARKit, ARCore, Vuforia, AR Foundation, OpenVR SDK, Valve’s SteamVR SDK, Virtual Reality Tool Kit (VRTK), Sony’s PlayStation VR (PSVR) Dev Kit, Meta’s Oculus SDK, and Google VR SDK.

By game genre, Strategy segment to record the highest CAGR during the forecast period

These games let players explore a vast, open world filled with cooperative gameplay and social features. One can create and customize weapons using primal energy, and challenge themselves by facing off against formidable bosses. This gaming genre tests players’ decision-making skills. It is a high-revenue game type; however, game-makers must be strategic in creating strategy games. Players are likely to get easily bored, especially if they feel a lack of progress while playing and brainstorming strategy(ies). Developers should include exclusive live event rewards, collectible mechanics, and special player vs. environment modes to incentivize players and reduce uninstalls.

By Region, Asia Pacific to record the highest CAGR during the forecast period

The Asia Pacific Metaverse in gaming Market is estimated and forecasted to have robust growth in the future. Metaverse in gaming solution vendors need to continuously innovate and upscale to meet the diversified demands from gamers across various countries, such as Australia and New Zealand (ANZ), Japan, China, Singapore, South Korea, India, Indonesia, Hong Kong. Gaming companies have been quick to jump on the bandwagon. Local tech and gaming giant Alibaba (China) is rewarding players with NFTs on its first blockchain game, Ant Adventure, which can be played through the Alipay app. IT services giant Fujitsu (Japan) and automobile manufacturer Mitsubishi have embarked on a collaboration to create an advertiser-friendly immersive gaming environment which has been grandly named the ‘Japan Metaverse Economic Zone’. Asia Pacific is the world’s largest hardware manufacturer. Metaverse in gaming vendors are sincerely upgrading the region’s connectivity technologies to be reliable, exhibit high bandwidth and upstream connections to be emerged for enjoying gaming metaverse experiences. Asia Pacific houses 55% of global gamers, totaling 1.7 billion, and contributes over USD 72 billion in annual gaming revenue. Role-playing games [RPG], popularized by titles like Final Fantasy and Dragon Quest, have been the dominant genre in Asia Pacific’s gaming market since the late 1980s and early 1990s.

Key Market Players

The report includes the study of key players offering Metaverse in gaming products, solutions and services. It profiles major vendors in the global Metaverse in gaming Market. The major vendors in the Metaverse in gaming Market include Meta (US), Activision Blizzard (US), Netease (China), Electronic Arts (US), Take-Two (US), Tencent (China), Nexon (Japan), Epic games (US), Unity (US), Valve (US), Accenture (Ireland), Adobe (US), HPE (US), Deloitte (UK), Ansys (US), Autodesk Inc. (US), Intel (US), Tech Mahindra (India), ByteDance (China), Nvidia (US), Microsoft (US), Samsung (South Korea), Google (US), Sony (Japan), HTC (Taiwan), Seiko Epson (Japan), Apple (US), Qualcomm (US), Panasonic (Japan), EON Reality (US), Roblox (US), Lenovo (Hong Kong), Razer (US), Nextech AR Solutions (Canada), ZQGame (China), TaleCraft (Marshall islands), VRChat (US), Decentraland (Argentina), Somnium Space (UK), Sandbox (US). These players have adopted various strategies to grow in the global Metaverse in gaming Market.

The study includes an in-depth competitive analysis of these key players in the Metaverse in gaming Market with their company profiles, recent developments, and key market strategies.

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Scope of the Report

The research report categorizes the Metaverse Gaming Market to forecast revenues and analyze trends in each of the following submarkets:

By component:

• Hardware
• Software
• Services

By hardware:

• AR Devices
• VR Devices
• MR Devices
• Displays

By software:

• Extended Reality Software
• Gaming Engines
• 3D Mapping, Modeling, and Reconstruction
• Financial Platforms
• Metaverse Platforms

By game genre:

• Action
• Adventure
• Casual
• Role-playing
• Simulation
• Sports & Racing
• Strategy

By region:

• North America
  • US
  • Canada
• Europe
  • UK
  • Germany
  • France
  • Rest of Europe
• Asia Pacific
  • China
  • Japan
  • South Korea
  • Rest of Asia Pacific
• Middle East & Africa
  • United Arab Emirates
  • Rest of Middle East & Africa
• Latin America
  • Brazil
  • Rest of Latin America

Recent Developments:

• In April 2023, Electronic Arts launched EA SPORTS FC which unveiled its new brand identity, vision, and logo. FC will become an EA SPORTS platform for creating, innovating, and expanding new football experiences, connecting hundreds of millions of fans via console, mobile, online, and esports products.
• In March 2023, Unreal Editor for Fortnite (UEFN), a version of the Unreal Editor that has the ability to create and publish experiences directly to Fortnite. With many of Unreal Engine 5’s powerful features at users’ fingertips, creators and developers have access to an entire world of new creative options for game production and experiences that can be enjoyed by millions of Fortnite players. UEFN will also permit the use of ‘Verse,’ which the company claims come(s) with powerful customization capabilities such as chaining devices together, and the ability to conveniently create new game logic hassle-free.  
• In January 2023, Unity, which is a global platform for creating and growing real-time 3D (RT3D) content, and Google together simplified ways for developers to create multiplayer experiences by offering two solutions from Unity Gaming Services (UGS), Game Server Hosting (Multiplay) and Voice and Text Chat (Vivox), on the Google Cloud Marketplace. 

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