Free games = free cash flow
Emailed on January 3rd 2020 in The Friday Forward
Global spending on digital games hit a record $109 billion last year, per Nielsen data cited by the Hollywood Reporter.
The most interesting part? Many of these games are free.
Free-to-play games drove 80% of that spending—games like Fortnite, which (again) was the top-earning title. The battle royale smash hit from 2017 generated $1.8 billion last year without charging cover.
Free-to-play games often generate revenue by selling virtual items within the game, allowing players to upgrade their skills or deck out their wardrobes.
These virtual items are so popular they’ve spawned secondary marketplaces where gamers can trade them.
But as free-to-play grew, the premium market shrank. Spending on “AAA” titles from major studios (think Call of Duty: Modern Warfare) fell 5% to $18.9 billion.
