The pandemic bubble has not burst In business this week

Last year, we wrote about how uncomfortable the gaming industry has benefited from the pandemic in this space, noting that the industry was moving to COVID-19 with the NPD Group’s U.S. consumer year-on-year decline for seven consecutive months. expense report.

Then the pandemic was declared in March 2020 and the game (at the time of that column) continued for 13 months with double-digit year-on-year growth.

That line was broken the following month, when year-on-year these comparisons became much tougher, when they were opposed to extinguishing the pandemic in the previous months, but the industry continued well into the fall, mixing for a few months. the single-digit drop was higher until October, when sales rose 16% year-on-year thanks to a strong list of new publications.

This seems to have marked a turning point, as November fell and the industry did not rise again.

STATE | 7 – The NPD Group’s year-on-year consumer spending on consumer games in the U.S. has fallen year-on-year, following a 19% year-on-year May sales report this week.

This is not particularly surprising, as many publishers said they expected investors to slow down when the pandemic calmed down and people began to return to habits and hobbies that could not keep people from being blocked.

Even then, they were optimistic that the industry would end up in a stronger place before the pandemic, and companies like Take-Two announced that they would maintain a significant share of the pandemic’s greater involvement.

That’s true for some companies so far – EA reported Apex Legends ’record commitment and growth in active player accounts last month – but not all.

STATE | 100 million – Activision’s monthly active users in the first quarter of 2022, the lowest number since Call of Duty Mobile 2019 was played for free.

Part of that can be blamed on the disappointing Call of Duty Vanguard, but Blizzard’s commitment also plummeted, falling 19 percent year-on-year to $ 22 million, the lowest number the company has had since it began renewing commitment statistics in 2016. It was also King’s commitment. down 3% year-on-year.

Activision Blizzard is also not the only company to see these trends.

FORWARD | “As the world began to enter a new normal, there was a moderation of trends that benefited our industry during the pandemic.” – Take-Two explained its lower net reserves to investors last month.

And while the pandemic hasn’t been blamed in either case, Embracer’s year-round negative organic growth and Devolver’s low sales expectations make it clear enough that we no longer see a viral rising tide that lifts all ships.

The momentum of the pandemic is fading, but I suspect there is a bit more to fall on before anything nearing normalcy arrives. On the one hand, there is not much reinforcement to come.

FORWARD | “We took a look at what happened with Cyberpunk 2077 and thought, ‘Yes, we’re delaying [our game]. ‘ … We knew our game wasn’t in its best shape, maybe we could patch it up with a Day One update … but we watched Cyberpunk and decided it wasn’t worth the risk. I suspect it was a call from all over the industry. “

This month’s huge showcase event didn’t give too much optimism for 2022 either, though it’s worth noting that Nintendo and Sony didn’t show it all in detail.

And then there’s the inconvenience that the pandemic isn’t really over, which has consequences not only on customer habits but also on the supply chain. Xbox CEO Tim Stuart told investors this week that the latest blockchains in China are expected to see supply chain problems until at least next year.

Moreover, the US seems to be going into a recession, and as we should all know from 2008 onwards, the games are not against the recession.

FORWARD | “The entertainment industry is not countercyclical despite what people say. We suffered after the 08 financial crisis, our competitors suffered, our numbers suffered and we don’t wish on anyone.” – Take-Toro’s Strauss Zelnick, facing the 2011 crisis.

So the games are in a bit of a vacuum. Consoles and computer space have seen a marked shortage of needles in the coming months, as have mobile phones – NPD’s mobile partner Sensor Tower down 23% in consumer spending on Google Play in the US in May – and macroeconomic conditions are not very favorable see for the near and medium term.

Spending on games is still well above pre-pandemic levels Mat Piscatella of the NPD Group stated on Twitter, but it is clear that the industry is returning to the momentum of the initial pandemic. What’s less is how much more it has to fall, and how much of that momentum that momentum can hold.

The rest of the week in review

STATE | 17 – The number of shows, live broadcasts, and shows of all of our announcements at this month’s major non-E3 events.

FORWARD | “Free games like this will be key to Xbox’s goal of growing its PC Games Pass audience outside of its mainland territories. In particular, games like League of Legends are a way for companies to access the products they need to sign. Asian market gains.” – Our Chris Dring says that Xbox’s collaboration with Riot Games was the biggest news in the Xbox-Bethesda showcase.

FORWARD | “What we’ve noticed in recent months is that there are a lot of truths about our company – individual and collective, experiential and data-driven – that can sometimes be difficult to reconcile.” – Activision Blizzard executives, before releasing the results of their own investigation, said that management had done nothing wrong and that the shocking revelations of the past year have led to undeserved media criticism and that a state agency is harassing a strange company for unknown reasons.

STATE | 2018 – Activision Blizzard began talking to the California Department of Employment and Housing about a pay equity study at the company, according to the findings of the study.

FORWARD | “Rushed” – how Activision Blizzard described DFEH’s complaint two and a half years later when it was filed in July 2021.

FORWARD | “At Ubisoft, we believe that women’s rights are human rights, trans rights are human rights, and that equal rights for all are essential to creating a world where everyone has a true identity and can thrive.” – Anika Grant, Director of People at Ubisoft, and Raashi Sikka, President of Diversity and Inclusion, told U.S.-based employees that Ubisoft is reviewing U.S. benefit packages “to ensure you and your family get the quality health care you need.” Republican politicians are pushing for a ban on abortion and gender-based health care.

FORWARD | “Without intervention, both companies are likely to sustain and even strengthen the sector, further reducing competition and limiting incentives for innovators.” – The UK Competition and Markets Authority has said it will investigate Apple and Google’s control over the mobile market, especially its 97% share of the mobile web browsing market.

STATE | 40% – Number of Switch Joy-Con drivers with driver diversion problems, according to the UK Consumer Caregiver’s WhichGov survey?

FORWARD | “On behalf of 343, I apologize for turning a celebrated moment into a painful moment.” – Head of 343 Industries Bonnie Ross, a cosmetic artist for Halo Infinite, who celebrates Juneteenth, a U.S. holiday that celebrates the liberation of slaves, without explaining how it was originally spread under the name of a monkey species. In particular, 343 community managers said that the name Bonobo refers to an internal tool used by the studio, which is an explanation that I will accept when we accidentally appear in “Microsoft Word” or “Google Docs”. headlines.

FORWARD | “Embracer is built on the principles of freedom, inclusion, humanity and openness. The transaction with SGG will not change that in any way.” – Concerned Lars Wingefors of the Embracer Group assures people that an investment by the Saudi government will not change the principles of a company that helped us bring GamerGate, QAnon and a series of mass shootings.

FORWARD | “That’s part of the genius of this PC expansion: Sony is inventing it all. the updated list is repeated to be released on the PC, it’s much better to buy a PS5 and stop worrying. ” – Industry consultant Sam Naji says that Sony’s scattered views of PlayStation-exclusive title attacks allow the company to take its cake and eat it.

FORWARD | “Interactive entertainment is consumed on another level [than linear media like TV and movies], about 45 hours a month and so on. There may be two or three or four properties in a month. It certainly has no more than 100 properties. So it’s not clear that your general public wants access to hundreds of games in a month and is willing to pay for them. This small subset of viewers might want that, but I don’t think it’s a broad base, because it’s not the way people consume interactive entertainment. “- Strauss Zelnick explains why he is skeptical that subscription services such as the Game Pass will be launched.

FORWARD | “So far, it’s not a really attractive service for the entire audience of the industry, which means there’s still a lot to play for who is becoming the market leader in this increasingly important sector.” – Sony’s upgraded PS Plus launch Assistant editor Rob Fahey assesses the state of industry-wide subscription services in a regular Friday column.


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