Research on the Current Status and Market Trends of the Gaming Industry in 2024: AI Multimodality to Drive Future Growth
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In 2022, China's gaming user base reached 664 million. The further integration of the gaming industry with other sectors is expected to advance 'virtual-real integration' and 'digital-real integration.'
In the digital era, gaming's cultural dissemination value is increasingly prominent alongside its entertainment value. As a new cultural medium, games can inspire exploration and interest in culture. Interactive experiences also promote cultural diversity, enriching and expanding cultural expressions.
Gaming is a broad cultural concept centered on content and scenarios. From language to text, one-dimensional to two-dimensional, and from printed books to e-books or 2D to 3D, games serve as multidimensional, animated, and virtual tools for expansion.
Gaming is not only about entertainment but also embodies technological and cultural attributes. The gaming industry is no longer just an entertainment sector; it has become a significant influence on national industrial layouts and technological innovation.
Looking at the gaming industry's investment and financing market, its growth is closely tied to the 'Internet+' boom. In terms of financing events, 2014 and 2015 saw peaks with over 500 cases each. Subsequently, the number declined, with 2021 recording the highest in recent years at over 200 cases.
From January to October 2023, there were 18 financing events totaling over 1 billion yuan.
The gaming industry chain consists of upstream game development, midstream publishing, and downstream distribution, involving game developers, cloud service providers, platform operators, and hardware manufacturers. Emerging technologies are expected to achieve large-scale commercialization in gaming.
The rapid development of the gaming industry has led more companies to explore 'gaming+' initiatives, integrating gaming with health, education, and healthcare to deepen the fusion of digital technology and the real economy, expanding the industry's value boundaries.
On December 4, the National Press and Publication Administration approved 87 domestic online games in its November review.
So far this year, 931 game licenses have been issued, including 873 for domestic online games and 58 for imported ones, nearing the anticipated 1,000 licenses and surpassing 2022's 579 and 2021's 748 licenses.
The mass issuance of game licenses is a positive signal, indicating that the game market is gradually regaining vitality. Game companies can now more actively introduce new products to meet player demands. Moreover, the issuance of licenses signifies that regulatory authorities are intensifying supervision of the gaming industry, which helps standardize market order and improve the overall development level of the sector.
The issuance of licenses has also encouraged more proactive investment decisions by game companies. Chen Rui, Chairman and CEO of Bilibili, stated during the Q3 earnings call that the gaming industry has entered a phase of存量竞争 (stock competition), with most new games released this year falling short of expectations, indicating a shift in industry dynamics.
2024 Gaming Industry Status and Market Trends Research
In Q3 of this year, Bilibili's mobile game revenue was 990 million yuan, a year-on-year decrease of 33%. Bilibili attributed the decline to the high base effect from Time Hunter 3, launched in June 2022, and the underperformance of several new games in Q3 2023.
Perfect World also mentioned the impact of new game releases on the existing market in its financial report. In the first three quarters, Perfect World's gaming business achieved a net profit of 641 million yuan after deducting non-recurring gains and losses, a year-on-year decrease of 40.56%.
Meanwhile, the gaming market revenue has shown a slight downward trend. From January to June 2023, China's game market actual sales revenue was 144.263 billion yuan, a year-on-year decrease of 2.39%, but a quarter-on-quarter increase of 22.16%. Among this, domestically developed games accounted for 121.784 billion yuan in domestic sales revenue, a year-on-year decrease of 2.25%, but a quarter-on-quarter increase of 24.53%. Overseas revenue from self-developed games was $8.206 billion, a year-on-year decrease of 8.72%.
As one of the most dynamic application scenarios for cutting-edge technologies, gaming continuously fuels technological innovation, serving as an "invisible driving force" and "technology incubator" for chips, 5G, artificial intelligence, and other advanced fields.
In 2023, with the rise of ChatGPT, Chinese game developers have diversified their attempts in the "AI + gaming" track to enhance efficiency and reduce costs. NetEase's Justice Mobile Game has pioneered the integration of NPCs with GPT, enriching game content and driving user acquisition and engagement, marking a new model for AI applications in gaming.
Advances in AI multimodal capabilities, particularly in AI video generation, may further improve applicability in the gaming sector. Recent breakthroughs in AI multimodal models include Pika Labs' launch of Pika 1.0 on November 29, an AI video generation tool capable of creating and editing 3D animations, anime, cartoons, and films in various styles.
The upgrade of AI multimodal capabilities and the reduction in calling costs will further expand their application scope and adaptability. As a commercial application integrating text, images, audio, and video, games are expected to better utilize multimodal large models in the development phase to enhance content production efficiency and richness. Additionally, AI-based NPC designs may further improve user experience and willingness to pay, opening up new revenue growth opportunities for the gaming industry.