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Industry Snapshot: Supporting High-Performance Network in the Global Cloud Gaming Market

2 December 2020

The global video game market has skyrocketed in 2020, and as a result, is predicted to become a $300 billion-plus industry within the next five years. As the rapid advancement and availability of cloud and connectivity services plays a major role in fuelling the gaming sector, even further growth is on the horizon as global networks proliferate, and enterprises continue their adoption of critical infrastructure and digital technologies to facilitate this demand.

With insights from Guilherme Soubihe of global bare metal cloud provider, Maxihost, we get to grips with the state of the gaming industry now, and discuss how service providers are enabling enterprises in this sector so they, in turn, can support gamers and their changing network needs.

Comprehending the demand for cloud gaming

Expected to jump 188% from 2020 to 2021, and reach $12 billion by 2025, the cloud gaming market contributes significantly to the overall gaming industry uptick. According to Cisco in 2018, gaming traffic was set to grow nine-fold from 2017 to 2022 to account for 4% of overall IP traffic in the latter year. But thanks to the global pandemic which has seen millions confined to their homes, spending more time on personal devices, these numbers are still exponentially rising.

This unprecedented surge in demand has been felt worldwide as improved internet access and connectivity have become available, enabling a multitude of users to log in and play. As of 2019, the Asia-Pacific region holds a major share in the market for cloud gaming, and is expected to uphold this position until at least 2024.

Across PC, console, and mobile, almost half of consumer spending on games globally will come from China and the United States in 2020, but industry growth is expected to be driven by other, emerging markets in the next few years.

Namely, the Latin American gaming market is set to soar, as we explored earlier this year with Maxihost’s Guilherme Soubihe, discovering that the region’s annual growth rate will compound by 11.40% to reach $6.29 billion in revenue by 2023.

Anticipating the need for high-performance networks

As digital technologies advance and 5G is gradually rolled out, the overall demand for faster connectivity speeds will inevitably ramp up. The emergence of 5G is seeing a huge number of gamers dig deep into their pocket for an improved online experience.

According to Sapio Research’s recent survey of 5,000 ‘ardent gamers’, 79% said they’d consider replacing their home broadband and mobile connectivity with 5G for a better gaming experience, while 58% would switch connectivity providers as soon as they could if a competitor offered a high-quality gaming service with a new 5G subscription.

The survey showed that almost all gamers surveyed were aware that the arrival of 5G brings higher speeds and greater bandwidth, and 95% of respondents agreed that they would pay more for this improved experience.

It’s clear that the consumer demand for gaming services to deliver exceptional performance is only increasing, and so enterprises in this space will be working to stay ahead of the curve to ensure they can continue to provide the services to fulfil these requirements. 

Facilitating industry growth moving forward

With consumer uptake thriving in the wake of advancing network services, service providers are subsequently being prompted to hone their offerings in ways that best suits players’ needs. 

“These markets require high bandwidth and extremely low-latency, well-connected networks that will give gamers and media consumers the best user experience possible,” says Guilherme Soubihe, CEO, Maxihost, who believes the focus for service providers is on delivering high-speed, high-quantity, and reliable services for connectivity.  

This year in particular, Soubihe has witnessed significant demand from high-profile multiplayer online game and media streaming clients in Brazil for servers and extra bandwidth to support users, as well as a surge in the use of self-service functions which reveals the network buyer’s desire to be more self-sufficient and agile.

Players are opting for more mobile-based gaming, with mobile game revenues set to account for 48% of the global games market at $77.2 billion in 2020, which is also shaping the way network providers are supporting growth in the gaming industry.

To keep up with this demand for smartphone and tablet gaming, enterprises are prioritizing the provisioning of mobile networks and high-speed, low-latency services, which will allow them to be competitive in fulfilling the needs of the rapidly growing sector.

With the advancements we’re seeing today in connectivity around the world, it’s almost guaranteed that the global gaming industry will continue to soar. As greater internet access, 5G technologies, and cloud consumption takes hold, the demand for gaming will surge, and service providers will continue to support gaming enterprises in facilitating this massive industry growth.

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