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Cloud Gaming is Evolving –  Could Carrier Billing Take Things to the Next Level?

A recent report from Juniper Research found that mobile and cloud gaming will lead the growth of the gaming industry which is set to exceed $200 billion in value in 2023.

Subscription models, the popularity of mobile games and 5G rollouts across major economies are all factors accelerating the shift toward cloud gaming. So, could carrier billing as a payment solution be a real game changer?

The Global Cloud Gaming Market

The cloud gaming marketplace is thriving, with more and more gamers putting away their consoles, and opting to play cloud-based games that deliver a seamless streaming experience, anywhere and everywhere, on connected mobile devices.

According to Newzoo, the global cloud gaming market will grow to 124.7 million users by 2022, and Niko Partners estimates the number of cloud gamers in Asia alone to grow from 3 million in 2019 to 60 million by 2023.

Revenues generated by cloud gaming are predicted at $585 million by the end of 2020, more than three times as much as the $170 million spent in 2019. The West will account for more than two-thirds of this, with North America and Europe generating 39% and 29% respectively.

Cloud gaming has also boomed during the coronavirus pandemic and 43% of UK gamers have taken an interest in cloud gaming amid the Covid-19 lockdown.

A Move to Mobile

The rise of casual gamers has been a clear driver for cloud gaming and in a 2020 study from RootMetrics mobile gaming was found to be the single most popular mobile lifestyle activity, with 64% of respondents saying they use their smartphone for mobile gaming daily.

Cloud platforms such as Project xCloud enable players to immerse themselves in the latest console games on their smartphones, with guaranteed console-like graphics but with the remote convenience of mobile gaming – provided there is a stable internet connection.

Facebook is the latest to introduce a cloud gaming feature following in the footsteps of tech giants like Microsoft xCloud, Google Stadia and Amazon Luna, and introducing free-to-play mobile games through its Android app and the web without downloads or worries about performance.

Monetisation Opportunities

Subscriptions

Cloud gaming and other video game subscriptions will bring in over $8 billion of revenue in 2023. The subscription model provides games publishers with the opportunity to ‘lock-in’ users, in the hope of generating guaranteed income and user loyalty.

More than half of all cloud gamers prefer paid gaming through a subscription model and subscribed players have also been found to spend twice as much on in-game content than non-subscribers.

Offering tiered subscription plans within cloud-based video game environments gives audiences control over content, with a choice to level up their experience if and when they wish to do so. However, a recent Piplsay survey reported about 35% each of Gen Zers and Millennials in the UK have not taken a cloud gaming subscription because of its price.

In-game purchases

The term “free cloud gaming” is searched globally around 6,500 times per month on Google and new research from Juniper notes that the popularity of free-to-play games like Fortnite and Call of Duty Mobile is intensifying the move to in-game monetisation.

According to Clarivate, cloud gamers spend more on in-game purchases per week than non-cloud gamers, with 93% making in-game payments compared to 75% percent of non-cloud gamers.

With 99% of mobile game downloads in the next three years F2P, smartphone in-app revenue is predicted to grow at 8%. More in-game purchases equals more interesting game play, meaning increased engagement, which leads to more spending.

Carrier Billing Payments

With an ever-increasing demand for casual gaming and lifted limits as a result of 5G, it makes sense that cloud gaming platforms are seeking to partner with mobile operators in order to guarantee a reliable internet connection and quality user experience on mobile.

Direct carrier billing holds huge potential for cloud gaming, and can drive revenues by giving customers the option to charge subscriptions, one-off payments or in-game purchases conveniently to their mobile phone bill.

Contact SLA Digital today to find out more about unlocking simple and seamless payment solutions in global markets.

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