The Game Tech Ecosystem

Written by Steven Bussey
on March 03, 2021

Gaming is a booming industry, increasing about 7 percent year-on-year for the past several years. In 2020, the global games market was projected to generate $160 billion in revenue. Forbes predicts industry revenues will reach more than $300 billion by 2025. Statista estimates that by 2023, the number of global gamers will have grown to 3 billion. Gaming companies also are attracting a considerable amount of investment dollars; for example, $15.35 billion from investment deals in the first three quarters of 2020. The gaming industry's fast growth has fueled an ecosystem of supporting companies, known as the Game Tech Ecosystem.

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Definition of a Game Tech Company

Game Tech companies have created products with a specific value proposition to the development and publication of games, either console, PC, or mobile. These software programs, tools, and services are used at any time during the product's life cycle, from development to publication to user acquisition.

The Ecosystem

Newzoo: Newzoo Gametech Ecosystem Map

A leading gaming market research firm, Newzoo, has developed an infographic mapping out the depth and scope of the Game tech ecosystem. Newzoo's infographic divides the companies that make up the ecosystem into first, second, and third-tier companies. They also have divided them into four categories: development, operations, growth, and market analysis.

Development

Game Tech development companies include those that create anything required to build a game. The category is subdivided into:

Engines, including companies such as Buildbox, Unity, and Unreal which provide cross-platform engines for creating games.
Art tools, including companies such as Maya and Adobe Photoshop. These companies create products that allow game builders to create characters, objects, and scenes.
Middleware, including companies such as Wwise and Nvidia Gameworks. Products from these companies integrate with game engines and tools or applications and can provide a bridge between the coding and sound design worlds.
Software management tools from companies such as Jira Software and Perforce.
Localization tools from companies such as Memsource. This subcategory is growing quickly as mobile devices are more affordable globally, and game developers need to localize the games for each market.
Audio tools such as Audition, Logic Pro X, and Ableton.

Operations

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This category includes products that help run, monitor, or optimize the games and is primarily focused on mobile games. Newzoo breaks down subcategories within this category as:

Game performance monitoring, including products and companies such as SmartBear Bitbar and Appium.
Ad monetization companies such as Ironsource and Google Ad Mob that improve the ability to earn advertising revenues through the mobile game app.
Ad mediation companies and products such as Fyber and Mopub, which help connect multiple ad networks to gaming apps.
Platforms such as Google Play and Xbox.
Infrastructure and cloud services such as Google Cloud and Firebase.
Game analytics companies such as Mixpanel, GameAnalytics, and Microsoft that help developers measure and analyze their game's health.
Customer engagement companies such as AirShip and One Signal.

Growth

The growth category includes all the companies and products related to the marketing of games. It is divided into subcategories:

Ad attribution and user analytics (UA) companies such as AppsFlyer and Adjust. These companies have products that allow UA managers to track where new gamers have come from. They also provide fraud solutions.
User acquisition companies such as UnityAds and Facebook that advertise games across user communities.
Influencer marketing companies such as Upfluence and Viral Nation. Influencer marketing has become increasingly important for PC and console games and is gaining importance for mobile games.
App store optimization companies such as Splitmetrics, Storemaven, and AppRadar that help UA managers improve their games’ app store pages.
Ad creatives companies such as Luna Labs and AppOnboard that allow game marketers to create and export videos and playables for ad networks and measure their effectiveness.

Market Analysis

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This final category of Game Tech companies within the ecosystem are those that analyze the industry itself. They include several market analytics companies including Newzoo, GameAnalytics, App Annie, and GameRefinery. They provide information on the industry to help their clients target their customers better and to make strategic and financial decisions.

Future of the Ecosystem

The ecosystem is expected to continue to grow as gaming continues to supersede other forms of entertainment such as films and television. As the ecosystem grows, competition is expected to also grow at each level. That competition will likely continue to drive innovation and, in turn, further growth.

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The need for localization of games will also grow rapidly as gaming gains popularity in more countries. Gaming is growing 7.7 percent year-on-year in the Asia-Pacific region; 6.6 percent year-on-year in the Europe/Middle East and Africa region; and 4.3 percent in Latin America. This will require a greater depth of companies in the localization subcategory.