Consumer spending on games console hardware, games and games services grew to a record high in 2021 and reached $60bn. The games console market remains in rude health with Ampere forecasting it to grow again in 2022 to over $61bn. Although 2021 market performance reached new highs, it was held back to an extent by lack of availability of the latest consoles. The increase in spending was driven by higher priced new consoles available on the market and increased adoption of subscription services, such as Microsoft’s Xbox Game Pass. Spending on full games, expansion packs, battle passes, and in-game items declined only 1% compared to 2020, a great result considering the backdrop of heavy spending fuelled by stay-at-home orders during the previous year.
Sony maintains its market share lead
Sony marginally improved on its 2020 market share as its consoles generated spending worth 46% of the total market. Nintendo’s market share slipped 2% to 29%, while Microsoft added 1% across the year to 25%. Sony’s lead underlines the importance of the PlayStation storefront and platforms to third-party publishers and developers. It also highlights the strength of Sony’s digital business compared to Nintendo, which still lags behind the other platform holders across full game downloads, in-game monetisation and services.
Console-based games services grow 20% year-on-year
Growth in spending on subscription services was driven primarily by improved adoption of Xbox Game Pass Ultimate, while Nintendo Switch Online and PS Plus also contributed. Microsoft’s inclusion of numerous ‘Day One’ titles helped Xbox Game Pass build momentum in the second half of 2021 with the service reaching 25m paid subscriptions by the beginning of January 2022.
Console services spending as a share of total console games content and services spend reached 19% in 2021, up from 15% in 2020. Ampere expects this to reach 21% in 2022.
Packaged games share of total games spending drops below 30% for first time
Nintendo Switch was the biggest platform for packaged games sales in 2021. Xbox spending is increasingly digital heavy driven by the sales success of Xbox Series S, its digital-only console.
2021 was the first time that packaged games sales dropped below 30% of a combined packaged and digital console games spend; the slow erosion of packaged sales will continue in 2022, with its share dropping to 26% according to Ampere.