Warner Bros released a new Harry Potter title last month and it grossed $850 million in two weeks. That title became the second most successful Potter release in the film studio’s history. Now, Hogwarts Legacy, the title in question, was not a movie: it was a video game.
Warner’s success is an example of how video games are overtaking more traditional media as a business and as a form of entertainment. It is estimated that consumers will spend 185,000 million dollars this year on games, five times more than on movies and 70% more than they will allocate to streaming services such as Netflix. Games, which were once a childhood pastime, have grown. Console gamers in their 30s and 40s already outnumber teens and 20-somethings.
However, as the game matures, it is not limited to rivaling other media. Like a voracious eater, he dedicates himself to swallowing them. While intellectual properties like Harry Potter are succeeding in game format, video game franchises have become the most in-demand type of intellectual property in other media. Apple’s Tetris movie is the latest (and perhaps strangest) example of Hollywood drawing ideas from games as the public grows weary of comic book heroes. Hobbyist creators are doing the same. After music, game videos are the largest category of content on YouTube.
At the same time, audiences are increasingly consuming traditional media through games. The final season of The Walking Dead, a long-running television series, took the form of an interactive game on Facebook. Musicians like Ariana Grande give concerts in Fortnite. The fitness video is giving way to the fitness game. Even social networks are partly migrating to the field of games. Platforms like Roblox offer kids a place to play, but also hang out, chat, and shop. If there is still such a thing as a metaverse, it is in games.
And further growth is expected. Mobile phones have put a powerful console in our pockets and unlocked hours of gaming on the way to work and in the back of conference rooms. The next push may come from smart TVs and streaming, bringing high-fidelity gaming to living rooms without the need for dedicated hardware.
New business models are another source of growth.
The most recent boom in gaming was fueled by free-to-play games, which draw in users and then monetize them with ads and in-game purchases. A new phase of expansion comes in the form of game library subscriptions, which are already showing signs of increased consumption and accelerating discovery, similar to what happened with the cable TV package. These new distribution mechanisms and business models promise more choice for consumers; and for this reason the regulators should authorize the acquisition that Microsoft intends to carry out for a value of 69,000 million dollars of Activision Blizzard, a large manufacturer of games whose titles the multinational from Redmond would make available to users in streaming and by subscription.
Lessons for other sectors derive from all this: mainly, that if you are in the media, you have to be in the games. Apple and Netflix are now rushing to supplement their streaming offerings with games. Other companies have already done it. In August, Sony Pictures will release Gran Turismo, a film based on a Sony game that includes songs by Sony Music artists. Media companies that ignore games risk looking like those that in the 1950s decided to stay out of the TV fad.
Governments should also pay attention. Their main concern so far has been that gaming will mess with the minds of young people (they almost certainly don’t, especially if the game distracts them from social media). And as games grow, bigger questions arise. Cinema and television, engines of popular culture in the 20th century, are dominated by Hollywood. Competition in new media is more open.
Western governments are realizing what it means for the world’s most popular social media app, TikTok, to be Chinese-owned. Next, you might as well consider what it means that China created two of the top three grossing mobile games of the past year.
When video games were just electronic toys, all this might not have mattered. However, as gaming expands and extends to other formats, it is becoming increasingly clear that whoever masters the games will influence all other forms of communication. In every way, the future of media is at stake.
