Cloud gaming services to ramp up significantly due to 5G

14 November 2019

Cloud gaming is set for massive growth due to the arrival of a combination of new cloud gaming services and the expansion of 5G networks coming online worldwide, according to a new report from ABI Research.

Three factors are expected to drive this growth: new gamers getting on board with cloud gaming, an increase in higher-quality visuals for smartphones and other connected devices, and existing gamers buying into the new technology. This will be run on 5G networks that offer higher speeds and lower latency compared to current generation wireless technology.

By 2024, ABI forecasts that there will be more than 42 million active cloud gaming users and overall market revenue is expected to reach $4.5 billion. During this forecast period, cloud gaming will manage a compound annual growth rate (CAGR) of 61.7%, but will still represent a small segment of the overall gaming landscape.

“Google Stadia has brought a great deal of attention to cloud gaming, but the market has a deeper history and already has a growing list of companies operating in the space, serving both consumers and business customers, including telcos and pay-TV operators,” said Michael Inouye, principal analyst at ABI Research. “While technical and behavioral aspects of the market are in a much better place today, the greatest competitive hurdle remains the incumbent gaming platforms, which will lead to a more protracted transition to the cloud.”

ABI said the transition from physical to digital media in the gaming market is happening rapidly and the long-term market forecast is that gaming’s future is in cloud computing. New consoles coming in 2020 will only help to reinforce this.

Learn more about ABI’s new research with its cloud gaming service.

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