Matthew Ball Unravels the Gaming Boom: Insights on Its Downfall and Path to Revival | The DeanBeat

Matthew Ball, the Chief Executive Officer of Epyllion and the author of The Metaverse, released 220 slides in an early access presentation this week detailing the dynamics behind the rise and decline of the contemporary gaming industry.

The slides are straightforward and I highly recommend everyone to peruse them; it’s much quicker to absorb the information than if he had presented an extensive essay on the subject. Ball provided a preview of his insights during our GamesBeat Insider Series: Hollywood and Games event on December 12 in Los Angeles. I am already looking forward to discussing this new slide presentation and the topics it introduces at our forthcoming event GamesBeat Summit 2025 on May 19-20 in Los Angeles.

Just a couple of years back, gaming reached its zenith in 2021 as the pandemic compelled everyone to stay indoors, and gamers found refuge in online interactions. The catalysts included the growth of mobile gaming, live services, free-to-play models, cross-platform capabilities, battle royales, battle passes, user-generated content, social gameplay, and the pandemic’s overall impact.

Matthew Ball documented this convergence of occurrences that propelled gaming’s growth at a pace unmatched by other sectors. However, it experienced stagnation over the past 2.5 years, culminating in an extraordinary 34,000 job cuts and a scarcity of investment funds to sustain the previously ignited wave of game development studios.

In brief, Ball encapsulated the current situation. He remarked, “The depletion of decade-long growth drivers that expanded player numbers, duration of play, and expenditure … coincided with shifting user behaviors, evolving monetization strategies, and heightened “lock-in” effects … that intensified long-standing competitive and economic escalations … while growth became concentrated in foreign territories that transitioned to local productions (and subsequently captured market share internationally) … and occurred against a backdrop of drastic macroeconomic financial developments and health crises … worsened by microeconomic policy changes of platforms … as well as the rise of new and highly viral alternatives … and foreign competition … in conjunction with a plethora of potential new growth catalysts that have yet to yield results.”

The anticipated catalysts of cloud gaming, wagering, subscriptions, esports, XR, Web3, metaverse, and app store regulation all failed to provide the essential growth, leading to a period of stagnation instead. Players have reverted to older existing live service titles, causing a slowdown in growth for new releases.

Apple’s change to prioritize user privacy over targeted advertisements hampered mobile gaming growth, which had sparked the decade-long expansion in the industry.

The console user base saw no growth. International development surged. Social media platforms like TikTok gained prominence and captured the interest of younger audiences. Gamers vanished into engaging titles. Sampling games became a trend of the past. Both production timelines and development expenses escalated. App Stores enforced restrictive, closed policies. Players resisted price hikes. Anxiety over failure caused companies to adopt a more cautious approach. The costs of acquiring users increased. Game discovery deteriorated.

In the absence of new growth drivers, gaming found itself in a relentless cycle. Revenues stagnated. Profits declined, with notable failures such as Concord and Suicide Squad: Kill the Justice League. Major corporations took fewer risks and curtailed their investments. This trend led to fewer blockbuster titles and studios, diminished new hits and innovations, resulting in stagnation in both player and playtime growth. That cycle continues.

However, Ball remarked that there remains a glimmer of hope. The Switch 2 presents some possibilities for revival. It will face competition from additional new handhelds and gadgets from companies like Valve, Sony, and Microsoft. Both Double-A and triple-A gaming are thriving on mobile platforms, exemplified by Genshin Impact. Emerging markets, such as the Middle East, are experiencing growth. Platforms and tools for user-generated content are surfacing on Roblox, Minecraft, Fortnite, and Overwolf. There is an upsurge in social gaming services. Regulation in app stores is beginning to manifest, potentially eliminating the 30% fees. Fresh gaming genres are appearing, with titles like Helldivers 2 and Palworld gaining traction. Artificial Intelligence could enhance game production, lower expenses, and discover new gameplay experiences. Advertising continues to expand, and Grand Theft Auto VI is anticipated this year, likely with increased pricing.

As always, some will thrive while others will falter.

In the meantime, I would like to convey my astonishment and dismay at witnessing the devastation caused by the Los Angeles fires. Please take into account the following resources and consider donations to the organizations listed: 211 LA, California Community Foundation Fund, Direct Relief, Greater Los Angeles Education Foundation, Habitat For Humanity of Greater Los Angeles, Los Angeles Fire Department Foundation, Los Angeles Regional Food Bank, Los Angeles Unified School District Education Foundation Emergency Relief Fund, MusiCares, and Pasadena Educational Foundation Eaton Fire Response Fund.

On a separate note, it is intriguing to hear the enthusiasm from the cryptocurrency community as a new Trump administration prepares to assume office on Monday, apparently featuring high-ranking crypto advisors. I fear that any potential advantage for Web3 will come at considerable costs, such as increased tariffs on gaming hardware.

I wish us all the best, and my thoughts inevitably turn to William Butler Yeats.

“And what rough beast, its hour come round at last,
Slouches towards Bethlehem to be born?”