Onome Amuge
The global gaming market is entering a phase of stabilisation following a post-COVID boom, with forecasts projecting revenues to exceed $189.3 billion in 2025. However, a new report, “The Fog of Gamedev: Gaming Market 2025: Stabilization & Shifting Growth,” discusses the gaming landscape marked by evolving player expectations, rising production costs, and shifts in regional growth and monetisation strategies.
Market dynamics and regional shifts
Mobile gaming continues to dominate the market, expected to reach $96.2 billion in 2025, although its success is increasingly tied to hybrid-casual design and narrative depth. Console revenue is projected to climb to $52.4 billion, boosted by anticipated blockbuster releases such as Grand Theft Auto VI and the advent of new platforms like the Nintendo Switch 2. Meanwhile, PC gaming is projected to rebound to $40.4 billion, driven by core players and a rising demand for narrative-driven hybrid titles.
Geographically, Asia-Pacific remains the largest region by revenue, though growth in key markets like China and Japan is slowing. Latin America (LATAM) and Southeast Asia (SEA) are emerging as the fastest-growing regions, propelled by local studios and culturally adapted user experiences, which are becoming a major competitive advantage.
Evolving player behaviour and studio challenges
The report underscores a fundamental shift in player expectations. Modern gamers are more selective, demanding immediate clarity, flexible progression, and emotionally resonant experiences. This is evident in the high churn rates for new mobile games, with only 6-8 per cent of players remaining after 30 days, often due to unclear onboarding or overwhelming user interfaces.
Studios, in turn, are struggling with a confluence of challenges including rising production costs, live operations fatigue, and blurred genre boundaries. The average cost of developing a mid-core game has surged by over 30 per cent since 2020. Despite this, many development teams continue to build with limited real player insight, missing crucial early frustration signals and emotional drivers.
The industry is also witnessing what is termed a “crunch culture” creeping back, with notable increase in developers working over 50 hours per week, often driven by self-pressure and fear of job loss amidst widespread layoffs that have impacted 34 per cent of teams.
The rise of indie and the search for sustainability
Amidst these pressures, the report highlights the “indie evolution,” where independent studios are increasingly becoming centres of innovation. The quality and relevance of indie games are soaring, with experienced developers moving into the independent space following industry layoffs. This has led to indie games accounting for nearly half of Steam’s full-game revenue.
However, despite this creative momentum, indie developers face financial pressures. This is as VC investment in games has more than halved between 2021 and 2024, and half of indie developers now self-fund their projects. This creates a paradox where creative risk-taking, often necessary for innovation, is hampered by a lack of structural support and funding for projects without a polished build.
The report concludes by advocating for a shift in industry mindset. “Success should not solely be measured by traditional high ROI metrics, especially in a market where many games struggle to break even,” it stated.
Instead, it suggested that studios consistently delivering a 2x ROI should be recognised for their profitability, growth, and ability to create jobs and deliver value to players, marking a path towards long-term sustainability. The emphasis for the future is on strengthening open communication with players, embracing early playtesting, and prioritising inclusive design that meets diverse player needs.
