• Sean Keenan

The Video Game Industry During the Pandemic

The COVID-19 pandemic and subsequent lockdowns that followed have rocked the entire globe, with nearly everyone being affected by this crisis. One of the most visible aspects of this effect is businesses, with many being unable to operate and suffering major losses. One industry though that hasn’t seen this effect is the video game industry. In fact, it’s been quite the opposite.

As seen here, people are spending more on video games than ever and while that number has been steadily increasing for a few years now, the growth this year is exponential. While the growth is notable and impressive, some are now wondering whether this is a quick boone from the lockdown that will stabilize once people can return to normal activities, or if this boost can be retained in the future for games.

Animal Crossing reaches new horizons

Of all the games that could be dubbed a “pandemic game”, Animal Crossing may have the biggest claim. Releasing earlier this year in March, right when the lockdown went into effect in the U.S., Animal Crossing: New Horizons is the latest in a series of cartoony, social simulation games from Nintendo. The series has always been quite popular, but the degree of New Horizons success, especially compared to previous games in the series, is somewhat staggering.

While these numbers are extremely impressive, some may attribute the level of success simply due to the Nintendo Switch itself being extremely popular, presenting a higher user base and allowing more sales. That isn’t quite the case though.

As seen here, nearly 30% of switch owners also own Animal Crossing, a much higher percentage than any of the previous games in the series. Beyond simple sales numbers, Animal Crossing has become probably the most talked about game in the world during this pandemic, already having 38 million tweets about it 2 weeks after it’s release.

The pandemic has undoubtedly provided a major boost for Animal Crossing, one that can be continued even beyond the pandemic. It’s grown from a quirky, somewhat niche life simulator, to one of Nintendo’s most prominent franchises, rivaling the likes of Mario and Zelda.

Playstation sets records

Nintendo isn’t the only company that has seen major gains from the pandemic. Sony Interactive Entertainment has long been praised for its many big budget exclusives, many of which rake in large sales numbers. This year alone, playstation exclusives have set sales records three separate times.

While games such as Final Fantasy VII: Remake and Last of Us II have been heavily anticipated for some time now, the fact that they both broke opening sales record numbers is still impressive, especially considering the former’s shipping issues for physical copies. In regards to the later, it’s continuously set more sales records since it’s last opening weekend as well.

With the release of it’s new console coming later this year, Sony is set to take advantage of these sales records, with Ghost of Tsushima getting a new multiplayer mode this fall. Combining updates such as these, along with all these games getting presumed performance enhancements from the new console’s backwards capabilities as well as sequels to other games such as Spider-Man, the launch of the PS5 may be setting itself up for a big launch.

More players and more activity

While sales numbers are a reasonable indicator that the pandemic has been a boost for the video game industry, it doesn’t completely explain how the pandemic has affected people’s video game habits. One of the questions people may have is what game genres are getting the biggest increase during this time. Some may think more relaxing games such as Animal Crossing will gain popularity as a way for people to escape, while others may think people want more immersive, single player games for their escape.

This chart tracked game genre increases from December to March. While there’s definitely external factors that attribute to certain genre increases, such as certain games getting big updates or releases, shooter games being the largest increase shows what many feel has actually been one of the biggest reasons for the spike in video games, which is a way for people to stay connected.

One of the biggest issues people face during isolation is a lack of interaction with other people. Shooters are a broad and popular genre, but many of the key features of them is that they’re often team based games with a heavy online presence. This lets people find a way to stay connected with people and have some sense of interaction that they’ve lost due to lockdown.

For a more exact look at how playtime for gamers has increased, the Steam database provides an in-depth look at their users and what their activity is.

This chart shows two main things

  1. When lockdown went into effect, there was a giant spike in user activity

  2. As restrictions begin to become more lax around the U.S., there’s still an increase in playtime compared to a pre-COVID era

This gives credence to not only the pandemic coincided with a large increase in gaming, but that this increase could have effects beyond the pandemic.

Another assumption many may make in regards to how the pandemic has affected the industry is that the younger age group is the most affected. As this data shows though, that isn’t exactly the case.

Every age group has seen a reasonable increase in playtime during the pandemic, even ages not commonly associated with video gaming such as the 56+ range. In fact, ages 41-55 has seen the largest increase in playtime compared to pre-pandemic times. This shows how far reaching gaming has been during the pandemic, opening itself to a multitude of different markets, helping the case that this increase will continue in the long run.

What does the future hold

Overall, the video game industry is one of the few that has seen a boost in both profits and popularity during the pandemic. Multiple companies have earned major boosts, with profits reaching Holiday levels during was it usually supposed to be the lean part of the year.

Despite this success, there are some concerns as to how the immediate future of gaming will look. While the pandemic has provided an initial boost in sales, that doesn’t mean there’s zero negative effect. Multiple companies have had their production stymied by work-at-home requests, with Nintendo, the poster child for this boost, being one of the most affected in that regard. The second part to the previously mentioned Final Fantasy VII: Remake has already been stated on record to be affected by the pandemic.

Despite this concern though, it remains to be seen how heavily affected companies will be. Nintendo doesn’t have any upcoming release dates aside from Pikmin 3 Deluxe, though major titles such as Breath of the Wild 2 and Metroid Prime 4 are confirmed to still be in development. Also, while Final Fantasy VII: Remake part 2 has been confirmed to be affected by the pandemic, the effect isn’t considered too severe.

While the profits won’t stay at levels this high, it’s reasonable to assume that this pandemic boost can be a jumping off point for much of the industry. With new consoles launching this holiday and a lasting increase in player bases, it’s a hard to see a scenario in which video game profits don’t continue to increase, even after the pandemic subsides.

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© 2020 by Sean Keenan.