Weekly Business Insights from Top Ten Business Magazines | Week 289 | Shaping Section | 1

Extractive summaries of and key takeaways from the articles curated from TOP TEN BUSINESS MAGAZINES to promote informed business decision-making | Week 289 | March 24-30, 2023

As video games grow, they are eating the media

The Economist | March 23, 2023

Listen to the Extractive Summary of the Article

Warner bros released a new Harry Potter title last month and took $850m in two weeks. That made it the second-most-successful Potter launch in the film studio’s history. But “Hogwarts Legacy”, the title in question, was no movie: it was a video game.  Warner’s hit is an example of how gaming is besting older media, both as a business and as a way for people to entertain themselves. Consumers are forecast to spend $185bn on games this year, five times what they will spend at the cinema and 70% more than they will allocate to streamers like Netflix. Once a children’s hobby, gaming has grown up. Console players in their 30s and 40s now outnumber those in their teens and 20s.

Yet as gaming matures, it is not just rivalling other media. Rather like a ravenous Pac-Man, it is gobbling them up. After music, gaming clips are the biggest content category on YouTube.  At the same time, audiences are increasingly consuming old media through games. The latest season of “The Walking Dead”, a long-running television drama, took the form of an interactive game on Facebook. Musicians such as Ariana Grande perform concerts in “Fortnite”. The fitness video is giving way to the fitness game. Even social networking is partly migrating to the gaming arena. Platforms like Roblox provide children with a place to play—but also to hang out, chat and shop. In so far as anything resembling a metaverse yet exists, it exists in games.

Expect more growth. Smartphones put a powerful console in people’s pockets and unlocked hours of playtime on the commute and at the back of the lecture hall. The next boost may come from smart tvs and streaming, which bring high-fidelity games to living rooms without the need for dedicated hardware.  New business models are another source of growth.  All this holds lessons for other industries—chiefly that, if you are in media, you need to be in gaming.  Media firms that ignore gaming risk being like those that decided in the 1950s to sit out the tv craze.  

Governments should also pay attention. Their main concern so far has been whether games rot young minds (almost certainly not, especially if playing diverts them from social media). As gaming grows, bigger questions loom. Film and television, the engines of popular culture in the 20th century, are dominated by Hollywood. The contest in new media is more open.   In every sense, the future of the media is in play.

3 key takeaways from the article

1. Warner brothers released a new Harry Potter title last month and took $850m in two weeks. That made it the second-most-successful Potter launch in the film studio’s history. But “Hogwarts Legacy”, the title in question, was no movie: it was a video game.  
2. Warner’s hit is an example of how gaming is besting older media, both as a business and as a way for people to entertain themselves. Consumers are forecast to spend $185bn on games this year, five times what they will spend at the cinema and 70% more than they will allocate to streamers like Netflix.  All this holds lessons for other industries—chiefly that, if you are in media, you need to be in gaming. 
3. Governments should also pay attention. Their main concern so far has been whether games rot young minds. As gaming grows, bigger questions loom.

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Topics:  Technology, Media, Gaming