A true Mobile Master, Michael J. Scott educates MBAs on industry-level challenges
Inflation, ads, and webstores reverse nearly every trend in gaming—and then reverse it again. These aren’t rounding errors either—they’re GDP-level phenomena (literally), and the inability to account for them is warping our perception of reality in the gaming industry.
Adjusting for inflation completely reverses the growth in mobile spending between 2020 and 2023, from +8% to -9%.
Adjusting for inflation slashes Newzoo’s 2026 PC & Console forecast by 39%, from +15% to +9%.
Ads revenue is likely a double-digit percentage of gaming revenue, and all we have to estimate is King’s quarterly earnings.
Adjusting for webstores completely reverses the revenue decline in some midcore genres, casting cold water on the “move to the middle” thesis.
Call of Duty Mobile (CODM) provided a watershed moment for mobile, proving Western gamers are ready for virtual dual analog stick controls and heralding a wave of Eastern titles to the West. Or did it?
IDFA is gone; how is your game designed to maximize distribution? Game designers, not marketing managers, need to start building for *sustained* user acquisition. Adding an influencer as a cosmetic is a nice stunt, but it’s not fundamental to the game loop. I was surprised at the dearth of these questions relative to the AI focus. If the Chinese refuse to divest TikTok, this question will become more pressing over the next year.
2. Web3 Evolved from Shipping No Product to Previewing Bad Product
Shrapnel, the web3 FPS developed by devs with actual game industry experience, was playable. It was…bad. The official launch is targeted for 2025, so there’s time to fix the issues, but this is another hopeful breakthrough that’s become doubtful. It’s still progress for web3, which usually lacks products of any kind. Crypto Unicorns, another game with actual product, opted for a giant unicorn display statue instead.
3. There are Four GDCs, and I’m Doubtful They’re Merging
There are separate GDC experiences for VCs, mobile, HD, and web3. Each has its own parties, personal, and drama. I keep thinking these worlds will merge, but it’s been at a sloth-like speed. The continued wave of dual-SKUs (hello, CoD Warzone, and Delta Force) shows product signs, but the actual circles employees run in remain distinct. I’m keen to see the final tally for this year’s attendance, but I sense a new record.
4. A Lot is Riding On UEFN
No one cares about Roblox because the 70%+ tax means studios will never scale. The top of the market, Adopt Me, does $50M in revenue, and it’s all downhill from there. UEFN allows an off-ramp to distribution on EGS or Steam and a much more favorable cut. Beyond anything else, UEFN will enable creators to prove product-market fit when raising another round, but Epic needs incredible roadmap execution. Key items have already slipped.
More of the event here, and my talk should be live soon…
1. Cultural Norms Matter
There’s far less “sharing” in Turkey than in Finland or Sweden. Anyone with a Finnish ID number seems to have access to Supercell’s dashboards! Turkey has largely avoided non-competes, and it must stay that way. King single-handedly has hamstrung Swedish mobile game development with its notorious three-month non-competes, which, after a three-month notice period, amount to six months for an employee to start elsewhere. France is dealing with a similar issue, and it’s to their detriment. Much of Silicon Valley’s success is due to the ban on non-competes, something that’s gone over the heads of subsidy-happy governments.
Matthew Ball’s excellent piece, The Tremendous Yet Troubled State of Gaming in 2024, unpacks a paradox: gaming seems prosperous yet is marred by unprecedented industry layoffs. Ball’s findings reveal a simple reality: playtime is down over 20% (3.5 hours per week) from its COVID peak. This decline, further seen in declining inflation-adjusted spending, cements gaming as an entertainment product with a capped growth potential. Without new strategies to reclaim time to share, gaming’s best days are behind it.
Phil Spencer, Microsoft Gaming CEO, named Johanna Faries the new president of Blizzard, closing a pivotal moment in the ATVI-Microsoft merger. Faries faces the challenge of revitalizing Blizzard amidst declining revenue and engagement across its franchises. The situation is dire enough that Faries inherits a needed rebirth of Blizzard. The Blizzard of old is dead, and several causal agents are responsible.
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