Gaming is now a $100 billion industry and is growing at 10% a year. Gaming organisations are also well positioned for an anticipated AI boom. AtlasTrend Co-founder, Kevin Hua shares insights with Which–50. (Viewing time 2:41 mins)
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The gaming industry is not slowing down. According to AtlasTrend Co-Founder, Kevin Hua:
“Gaming is now a $100 billion industry and it’s growing at 10% per annum. Gaming organisations are also well positioned for an anticipated AI boom.”
“Gaming is not just an application of computing. It’s actually at the core of software development,” Hua told Which-50.com.
“A lot of these companies that have developed business applications, they’ve done so because they’ve taken technologies and processes out of gaming.”
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For those keeping tabs on the industry there are 3 key metrics to pay particular attention to, according to Hua. Top line revenue growth determines a game’s shelf life and is driven by the launch of new games and existing franchises, Hua said. It’s also important to monitor the average revenue per user.
“That determines how much revenue can be generated from each user in each game, either from buying the game directly or from in game purchases.”
Churn is the other key metric to monitor, according to Hua. Some games will see quick cycling of users while others enjoy “stickier” users.
In Australia, the industry is worth $1.5 billion with over 12 million gamers.
According to Hua, two companies are positioned particularly well in the industry — Netease and Nvidia.
Netease is a a Chinese online commerce organisation, most famous for its online gaming business, Hua said. Netease develops its own games and also has a partnership with American video game publisher Activision to distribute Activision games in China.
And with 20% of gamers being in China, Netease is well placed, Hua said.
Another standout according to Hua is Nvidia, a graphics processing unit (GPU) producer. GPUs can be found in phones, gaming consoles and computers. They drive the “computational power that’s required to operate these applications,” Hua explained.
“[Nvidia GPUs] have the computational capability to deal with the complex algorithms required” of applications like artificial intelligence,” according to Hua.
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Republished with permission from Which–50.com