How and When Will Virtual Reality Disrupt Digital Gaming?
The Game Developer Conference opens today in San Francisco, and over 26,000 people are expected to attend this year. GDC was founded in 1987 and is the largest gaming event in the industry. And, the Verto team is on the floor talking to attendees about how we measure the digital gaming ecosystem.
One of the key topics this year is how various device types can be used to play one game. For example, Angry Birds can be played on a PC, a video game console, a smartphone and tablet, and a smart TV. But, virtual reality, and how the different VR kits could change the gaming experience and create new revenue streams, really has everyone’s attention.
To put the gaming ecosystem in perspective, we drew from the Verto Content Watch data (U.S.-based, 18+ adults) to compare platform usage.
As shown in the graph above, the smartphone gaming audience is the largest – almost 100 million unique users monthly. 80 million users play games on either PCs or video game consoles. The tablet gaming audience has 53 million users. Despite lots of hype, those who play games on smart TVs number at just 5 million unique users per month. Finally, slightly fewer than 1 million people in the U.S. own one of the new virtual reality devices.
So, at least for the time being, the new devices themselves don’t pose a challenge to the incumbent platforms, at least in terms of unique users. The potential disruption is more likely to occur in the way users engage with the games; how they spend money (we have seen already a great deal of growth with mobile in-game purchases); and how games could interplay with the physical world and your real-life experiences — e.g. user location being taken into account.
Another one of the most discussed topics at GDC this year is mobile gaming. Mobile games rank extremely high on the top app download lists. Beyond downloads, what matters to these games’ future success is user adoption and continued monetization. It is not trivial to track these metrics:
- How individual titles are played versus their competitors;
- Who spends the most time on specific game categories;
- How to best optimize audience acquisition budgets against the total lifetime value of gamers.
While there are many analytics solutions that report game downloads and player activity, there are few players that measure the gaming audience — reach, frequency of use, and engagement — and individual titles. [Take a look at our recent App Report to see some of our numbers.] Key questions we answer include:
- How much time do people spend on games?
- What is the demographics of mobile game players?
- What is the length and frequency of game play?
- What other types of content do they consume on their digital devices?
Measuring mobile gaming comprehensively will remain important, given that the industry is growing so quickly. Tight competition means game publishers need to make hard calls not only in the short-term (acquiring the audience and optimizing their game-play dynamics) but also in the long-term (monetizing on their audience). Our data shows that the most financially successful mobile games have the high stickiness rates — meaning that users return to play the games on a daily, monthly basis.
There’s no doubt that the digital gaming market is rapidly growing and expanding across platforms. While virtual reality is niche today, we expect to see things change quickly. The gaming business has enough revenues to justify active innovation, and the competition will be fierce in the domain for years.