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The DeanBeat: Predictions for gaming in 2021

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This past year was one of the most unpredictable in all of human history. The pandemic threw off our ability to predict what will happen in the game industry. It surely messed up my predictions about where the games industry would go. Game companies had a record year in 2020, but I never would have predicted that in March as the world seemed headed into an unprecedented global recession caused by the coronavirus.

But people turned to gaming as a solace, and the whole industry not only survived. It prospered. Market researcher Newzoo is predicting that the entire game industry — PC, mobile, and console games — will grow 19.6% to more than $174.9 billion in 2020. With two new consoles launched in November, the industry will likely grow again in 2021, helping gaming stand apart from the crowd. This year, we saw a huge surge in venture capital investments in game studios, and a big wave of acquisitions as well, with Microsoft buying ZeniMax Media (Bethesda) for $7.5 billion and Embracer Group announcing it had bought 12 game studios in one day. A continuation of this growth is the easiest prediction to make.

But the pandemic has changed the predictability of the industry in many ways. Esports will continue to struggle as it moves forward in a digital-only format, and it’s not clear when we will ever be able to go to live esports events again. Game conferences are one of the places where we can catch up on future trends, but so many of those events have been canceled or gone digital (such as our GamesBeat/Facebook Summit on Driving Game Growth and Into the Metaverse on January 26-28).

But we can expect games to continue to dwarf other forms of entertainment. Movie and TV production has been hobbled, and cinemas are all but shut down. With that limited horizon, I’m going to boldly make my bad predictions once again.

For the usual comparison and embarrassment, here are my predictions for 2019, 2018, 2017, 2016, 2015, 2014, 2013, and 2012. At the bottom of the story, I’ve also given myself grades for the predictions I made a year ago for 2020. Lastly, I’ve been very publicly calling for ideas on social media about my predictions, and I appreciate all of the followers and readers who have pitched ideas to me. Thank you for your help, and Happy New Year! May it be a better one than the one we just endured.

2021 predictions

Above: Tim Cook, CEO of Apple, is a big advocate for privacy.

Image Credit: Apple

1) Apple’s IDFA change will hobble targeted advertising for iOS games

Apple is on a quest to put user privacy above all else. But that means it will no longer allow advertisers to extract user data to do targeted advertising. And that’s what Apple’s retirement of the obscure Identifier for Advertisers (IDFA) is all about, and the game industry is caught in the middle in this fight between Apple and advertising companies.

Apple warned the change in its opt-in rules for IDFA usage was coming and it planned to launch it in mid-September. But Apple postponed the change after the ad, app, and game industries warned about the disruption it would cause. But the reprieve was only temporary, and Apple is moving ahead in early 2021 with plans to require users to specifically opt-in if they want to be tracked for advertising purposes. Without proper explanations for what it means for app pricing, most people are opting out. And that could cause a big disruption in iOS games, which generated perhaps a quarter of the industry’s $174.9 billion in 2020.

Since the effect is so unpredictable, some mobile marketing companies are raising the alarm bells, but game companies are saying it may not be a big deal. I predict it will have different effects on different players in the industry.

Eric Seufert, monetization expert and owner of Mobile Dev Memo, believes both Google and Facebook will be impacted. He thinks that those companies might better oppose Apple by noting how consumers could lose access to free apps and games that advertising allows them to enjoy. He thinks highly monetized strategy games, role-playing games, social casino games, and other titles that need to reach very specific customers will suffer, while casual games and and games that naturally go viral on their own, without the need for targeted ads, should do well. He thinks there will be little impact on subscription apps and those that are only moderately dependent on ads or in-app purchases.

I worry it could trigger a recession in games and cause the fastest-growing part of the industry to stall. That said, I believe this is a very unpredictable but important issue that is far too opaque. For the opacity, I blame Apple. It might just come out and say it wants to change the way that games become successful on the app store, but that might mean more legal trouble for Apple. But one thing is clear. Ignore the IDFA change at your peril.

2) Epic Games may lose its legal case but win a wider war

Epic Games is launching the Free Fortnite Cup. Guess who the villain is?

Above: Epic Games launched the Free Fortnite Cup with Apple as the villain.

Image Credit: Epic Games

The sad thing about the IDFA is that Apple is judge and jury, and the industry can’t do much about it. And that reminds me of Epic Games’ quixotic antitrust case against Apple. Epic Games has assembled good evidence, and it is a bold strike to fight back against Apple’s control of mobile gaming. At the cost of getting its own Fortnite game booted off the App Store by Apple, Epic Games is doing a big favor for game developers in standing up to Apple and trying to get rid of its 30% royalty cut on all App Store sales.

But antitrust law is antiquated, and it doesn’t necessarily protect a company like Epic Games when a platform owner like Apple decides to cut it off. If a judge decides that Epic has plenty of other choices where it can take Fortnite without much direct harm to consumers, then Epic Games could lose the legal case even though it has the moral high ground.

But if Apple does everything it can to crush Epic Games as it has so far, Apple could lose the wider war. Regulators could change their policies or Congress could amend antitrust law and curtail Apple’s power. But the game industry could also aggressively seek to escape the platforms and the app stores that the tech giants run. They could support HTML5 games such as Facebook’s Instant Games or Snap’s messaging games or Nvidia’s GeForce Now that use the open web to circumvent the app stores. By creating downloadless game experiences with HTML5 or royalty-free cloud games, game companies could bypass the gatekeepers and escape the rules of the tech giants. The open web could be a viable path to an industry that doesn’t have to pay the platform tax.

If regulators or the rest of the industry force Apple to become more open, then Epic will have accomplished its goals, even if it doesn’t reap benefits for itself. In the long run, the game industry and its platforms could become more open, and we could thank Epic’s Tim Sweeney for that.

3) Game IPOs will continue and change the game industry

Unity Technologies has 1.5 million monthly active users.

Above: Unity Technologies has 1.5 million monthly active users.

Image Credit: Unity

Because gaming has done so well in the pandemic, more investors have noticed the industry and are moving money into it. One way is through initial public offerings (IPOs), and another is special purpose acquisition corporations (SPACs). Game engine maker Unity went public and is now valued at $40 billion, far more than the $17 billion value of the larger rival Epic Games at its last funding in 2020. Now Unity is too big to be acquired by most other game companies.

Skillz went public via a SPAC, and Roblox and Playtika are expected to follow up with IPOs soon. These companies are exploiting a historic window of opportunity that will enable them to stay independent. And that means that they won’t be acquired anytime soon by tech giants or the biggest game companies. And from our first two predictions, we can understand some of the danger of companies becoming too big, either through their own great business ideas or by acquisitions.

I don’t want to sound like a free-market-at-all-costs advocate. But if big game companies acquired a bunch of the big game developers, that could stifle innovation and creativity for a time. With the IPO window open, there’s still a way for the public to get in on the action and reward the best game makers with a market value that is inflated in the public markets and makes it impractical for another big game company to try to take them over. That’s good, as I don’t want to see all the good game developers get acquired. IPOs are the market’s way of saying that if you create something great, you don’t have to sell it to big corporation to make it pay off. You can sell it to all of us, and keep control of it.

Don’t get me wrong. Money pouring into games instead of into other industries is a good thing. That’s happening on the level of game startups, and it’s good for the owners of mid-sized companies, and it’s good for the owners of the newly public companies. Hopefully, the markets will stay strong and it will be good for public stock investors as well.

4) Game streaming and movie streaming will get hitched

GamePass with xCloud.

Above: GamePass with xCloud.

Image Credit: Microsoft

The big Hollywood companies — and their owners — are all pouring money into the streaming of movie and TV shows in a bid to ward off Netflix. But Netflix itself is moving into games, where engagement with an intellectual property can be far higher and more lucrative. We have seen Apple, Disney, NBCUniversal, HBO, and more move into movie streaming.

At the same time, we’ve seen Google, Microsoft, Sony, Amazon, Nvidia, Shadow, and Facebook all move into the streaming of cloud-based games. Microsoft has launched its Xbox Game Pass subscription in the hope of becoming the Netflix of gaming. It may not make tactical sense, but big companies will see the strategy that they can pursue to become even bigger and lock up more users.

Surely, someone in this vast marketplace will see that the convergence of technologies and the economies of scale could favor a company that brings game streaming and movie streaming under one roof. Disney could gain a lot of subscribers if it bought Electronic Arts and made its games available as part of the streamed Disney+ service. Strategically, such a service could be a way to aggregate consumers and concentrate media power into the hands of a single company with a single subscription. But this requires a skill that the biggest tech and streaming companies have not mastered: understanding gaming and allowing game companies to be their best. Let’s just hope that broadband technologies such as 5G networks will enable us to stream so much entertainment into homes.

5) The metaverse will begin to emerge as social gaming grows

Roblox will hold events related to Ready Player Two by Ernest Cline.

Above: Roblox is holding events related to Ready Player Two by Ernest Cline.

Image Credit: Roblox

Such a company as we’ve envisioned in the previous prediction could become so strong that it could launch the Oasis, a metaverse controlled by a single company, offering gaming, movie, TV, and other entertainment services so that you’ll never have to leave it.

We desperately need a metaverse to escape the Zoomverse that we have all been stuck in during the pandemic. We need something that is more immersive and enthralling than video. Realistic or fantastic game worlds can deliver that. While Ready Player Two has been criticized by many observers, I would love to hang out in the worlds of J.R.R. Tolkien, as envisioned in Ernest Cline’s latest book.

The metaverse should offer a rabbit hole of fun for everybody, whatever your particular preferences are. And there are many ways for it to emerge. Netflix could launch a vast game world full of its entertainment properties. Epic Games or Roblox or Microsoft’s Minecraft could create a metaverse for their fans. Every company that has amassed an audience has to make that audience more engaged and more social, and connecting fans in a world — preferably a game world — they never have to leave is my expectation for a real metaverse, not one that tries to trick us by being a metaverse in name only.

A lot of companies will try and fail to create what author Neal Stephenson envisioned with Snow Crash back in 1992. I’d like to see it succeed soon (and that’s why we’re holding our own GamesBeat Summit: Into the Metaverse event on January 27-28). It will take years to build and perfect the metaverse, but let’s start it in 2021. I realize it will take time, but we need this. For our own mental wellness and every other reason as well.

6) God of War: Ragnarok will remind us of Sony’s greatness

God of War is coming again.

Above: God of War: Ragnarok is coming sometime. Hopefully in 2021.

Image Credit: Sony

At The Game Awards, Sony showed a small teaser for the next big exclusive game for the PlayStation 5, and it will be God of War: Ragnarok. The sequel to 2018’s winner of many Game of the Year awards will hopefully debut in 2021.

Cory Barlog, the game director at Sony Santa Monica, is busy at work trying to top his previous creation. But this game is much more than just a sequel. It’s a reminder that Sony believes in giant single-player games with a shitload of storytelling. Exclusives like God of War made the PlayStation 4 stand out and pull ahead of other consoles in the last generation, and Sony still has many studios working on such games for the PS5, which is off to a good start. Barlog took what might have been a weak God of War 4 and turned it into a father-son tale that was more widely appealing.

This next God of War title will have a heavy burden. It has to show that big, exclusive single-player narrative games still make sense when triple-A titles are under attack from free-to-play games that last forever. Sony has shown more than any other game company that it still believes in these narrative masterpieces in the face of competition from year-round franchises such as Call of Duty and FIFA.

7) Halo: Infinite will put Microsoft back in the game

Halo Infinite Master Chief

Above: Halo Infinite Master Chief.

Image Credit: Microsoft

We haven’t seen shipment numbers yet, but it certainly feels like Sony had a more balanced launch for the PlayStation 5, with good exclusives such as Spider-Man: Miles Morales and Astro’s Playroom to stir demand. Microsoft showed up with Xbox Game Pass and lots of compatible games, but the launch lineup was underwhelming. The missing part of the console launch was Halo: Infinite, which got a poor reception in its preview. 343 Industries and Microsoft shook up the team’s leadership and brought in former Bungie leader Joseph Staten. Now the game will ship in the fall of 2021, so long as there isn’t another delay.

Microsoft has always tried to align a good launch lineup with its console launches. It has also tried to launch new systems with new Halo games, but it has succeeded only in doing that once, with the launch of the original Xbox. With Xbox Game Pass available and a good strategy on backward compatibility, the company can focus on getting lots of units into the market even without a tent-pole title. By the fall of 2021, however, it will need a system seller to keep pace with the PS5. Titles from Microsoft’s acquired studios will only begin to show up around that time, and the development job should become simpler as making titles that run on both generations — Xbox One and Xbox Series X/S — should get easier with experience.

I’m hoping Microsoft will use the time to double down on content for Halo: Infinite multiplayer, esports tournaments, and bigger marketing plans for what could be its biggest Halo yet.

8) Nintendo will unveil the Switch successor in 2021

World of Tanks Blitz plays at 30 frames per second and 720p on the Switch handheld and 1080p on the TV.

Above: Nintendo Switch.

Image Credit: Wargaming

The Wall Street Journal reported that Nintendo was readying a successor to the Nintendo Switch in 2020. But Nintendo didn’t announce the system, and it has focused on cranking up production of the Switch and the Switch Lite. At some point, however, sales of the PS5 and the Xbox Series X/S will start to eat away at potential Switch buyers. If we have something like an Electronic Entertainment Expo (E3) in 2021, that would be a good time for Nintendo to announce a next-generation system. Developers could get a headstart on developing games for the system, and Nintendo could launch it in the spring of 2022, about five years after the launch of the original Switch. I’m not going on insider information, so this is speculation. But it would make sense for Nintendo to stay away from the launch cycles of its console rivals and pursue a strategy of being an alternative to Microsoft and Sony.

Nintendo definitely found a broad niche with the Switch, as a hybrid machine that is both playable on the TV and as a portable device. If Nintendo focuses on that niche and expands it further, it could withstand the forces around it such as cloud gaming, multiplayer universes, and mobile gaming.

9) Regulators will come after both games and game platforms

Star Wars: Battlefront II

Above: Star Wars: Battlefront II.

Gaming has become front and center of the entertainment universe during the pandemic. But that means it will draw the attention of governments and regulators. China has cracked down on games with censorship, and slowed the approval of new mobile games to a trickle. It is removing games that don’t have proper registration. It has put limits on how much minors can play out of concerns about addiction. The rest of the world’s regulators won’t be as harsh, but they will pay more attention to games and their effects on society. I wouldn’t be surprised if more countries ban loot boxes as illegal gambling or regulate it as entertainment for adults.

The game industry is walking a delicate tightrope. Campaigns such as #PlayApartTogether, aimed at getting people to social distance during the pandemic, are broadly appealing. But free-to-play games that have pay-to-win mechanics, aggressive monetization that can prey upon the young or people with addiction problems, privacy-invasive advertising, or gambling-like hooks could prompt regulators to crack down. That’s all in the name of protecting people from game companies.

But as we’ve seen with Apple and Epic’s clash, regulators may also pay attention to the platforms that host games and whether they’re enabling fair competition. And I think we would like to see the platforms create an open metaverse to host the games of the future. If they don’t, the crackdown will come. It’s time for the game industry to get in front of this problem, aggressively.

10) Riot Games will establish Valorant as an esport, and other games will follow

Valorant is a 5v5 shooter game.

Above: Valorant is a 5v5 shooter game.

Image Credit: Riot Games

Counter-Strike: Global Offensive has been a staple of esports for decades. But Valve hasn’t invested much in the esports ecosystem, in contrast to Riot’s efforts to establish a permanent esports ecosystem around League of Legends. Riot will now leverage that ecosystem to establish its second major esports game: Valorant. Valorant still has a long way to go to catch on with the masses of gamers. But esports pros have been switching over to Valorant from CS:GO. Valve will have its hands full trying to reinvest in its game as a counterattack, but Riot is a far bigger company with 3,000 people. It can afford to invest in Valorant, but the key will be to bring in new esports fans into the fold, rather than just stealing the audience from CS:GO.

For the past few years, esports has grown dramatically in terms of its audience, but it still needs fans to spend money in order to generate profits the way that traditional sports teams can do. That’s hard to do while we’re in a pandemic and physical events aren’t possible. But it is possible to grow a huge digital audience and ramp up the fan base for the day when physical events could happen again. I hope somebody knocks it out of the park because we could sure use another billion-dollar esports game.

11) Game startups will continue to thrive and generate huge game ecosystems

Griffin Gaming Group's focus.

Above: Griffin Gaming Partners’ focus.

Image Credit: Griffin Gaming Group

During 2020, more than 30 game-focused venture capital funds set up shop to invest in game companies. Game investment site InvestGame estimated that more than 100 game studios received funding in 2020. Combined with acquisitions, the deals led to more than $20.5 billion in transactions in the first nine months of 2020.

When I started at VentureBeat 12 years ago and started GamesBeat, there were no such venture capital funds. Traditional VCs slowly picked up game-savvy investors, and the specialty funds evolved out of that as game investors and entrepreneurs became successful and plowed the money back into new funds. March Capital is on its second game-oriented fund with a $60 million raise for its March Gaming Fund, and Griffin Gaming Partners has raised $235 million.

That new capital has barely begun to work, even though it feels like a couple of fundings per week is a bit much. What I enjoy seeing is the economic benefits of the job creation that happen alongside these investments. If you look at Turkey, for instance, it had the core of a mobile game industry arise with the success of Peak Games and Gram Games. Zynga bought those companies for enormous sums, and some of the people who got their first jobs with those companies have now splintered off into their own startups. Game VCs are investing in those studios, and Turkey is now a hot spot for games, with a lot of economic goodness resulting from that. Countries such as the U.S., China, the United Kingdom, and Canada still have the strongest ecosystems, but there’s no reason for them to monopolize all the jobs. A strong game ecosystem can arise anywhere now, and the game VCs are the fertilizer for that growth.

These small studios will grow, launch hits, and then get acquired by the big publishers over time, starting the cycle over again.

Lastly, here is my scorecard for my 2020 predictions from a year ago.

2020 Scorecard

1) The Last of Us: Part II will be my favorite game of 2020

Letter grade: A+

This game didn’t turn out anything like I had expected a sequel to be. The 2013 Naughty Dog game The Last of Us was my favorite of all time. But this title took what I liked about the game — the characters and the special relationship between the father figure and the daughter figure of the previous game — and destroyed it. Then The Last of Us Part II proceeded with a script that was the logical consequence of Joel’s decision in the first game to lie to Ellie about why she didn’t need to be sacrificed to develop a plague vaccine. The game introduced us to new characters in the universe of the post-zombie apocalypse, and it told a story about revenge and redemption that I totally didn’t expect.

Even so, it was a moving story, with compelling characters, flawless execution on graphics and gameplay, and everything else I expect from a Naught Dog production. It made a statement about violence through a story in an extremely violent video game. It was emotionally exhausting to play it, and it wasn’t what a lot of people consider to be fun. But I’m glad Naughty Dog created it and that I played it through with my daughter.

2) Sony’s PlayStation 5 will be a smashing success

Letter grade: A

We don’t yet know how many units Sony has sold for the PlayStation 5, which debuted on November 12. But we know that it likely outsold Microsoft’s Xbox Series X/S. (It really is just a matter of which company did the best job lining up its supply chain.) If I were to gamble, I’d say that Sony won, with a better lineup of titles like Spider-Man: Miles Morales and Astro’s Playroom.

While Microsoft made some big strides in matching Sony when it comes to first-party studios, Sony had its studios in place for a longer time. It managed to bring some big projects home at the same time as the launch, and that made a big difference in the eyes of gamers. Sony outsold Microsoft by more than 2-to-1 in the last generation, and it’s going to be hard for Microsoft to steal away those gamers. This console war is Sony’s to lose.

3) The Xbox Series X will also be a big success

Letter grade: B

Microsoft had everything going for it when it readied the launch of the Xbox Series X/S. It had two different consoles to target two different types of buyers: the hardcore spenders and the budget-conscious fans. It lined up a lot of new studios with acquisitions. But nothing came in for the finish line in terms of big games that could shine on the new console.

The biggest game of all, 343 Industries’ Halo Infinite, was delayed a year until the fall of 2021. Microsoft showed up without a major exclusive to make its console stand out. But it did show that its Xbox Game Pass subscription had grown quite valuable in the eyes of consumers, and it also made it easy for fans to upgrade to the new machine by making its Xbox One games compatible with the Xbox Series X/S. With those moves, Microsoft will hang on to its own hardcore base. Microsoft’s fans will have to be patient as they await big titles and new games coming from Microsoft’s acquisitions, however.

4) Fry’s Electronics will shut down, and so will many video game stores

Letter grade: C

Fry’s Electronics is definitely a dinosaur from another era. It should have become dominant in the age of big box retail, but the chain never expanded that aggressively. And yet somehow, the chain is holding on. The company closed another big store in Campbell, California, in addition to one in Palo Alto, California. But like other big box retailers, Fry’s has been Amazoned.

It’s like the walking dead. But for some reason, it’s still alive, prompting my C grade on this one. With the coronavirus still running rampant, big retail’s days are numbered. Most shoppers report that Fry’s stores are bereft of merchandise. They’re big empty shells. It’s sad, as Fry’s Electronics, which grew up with groceries in one aisle and memory chips in another, is a Silicon Valley institution. I’m not expecting it to be around much longer. GameStop isn’t faring much better, with 462 stores closed in 2020.

5) Nintendo may reveal new hardware, but won’t ship it in 2020

Letter grade: C

I scored an F when it came to whether Nintendo would unveil new hardware to replace its successful Switch. But I scored an A in noting that Nintendo was not likely to launch the said unannounced console in 2020.

Nintendo should be in no rush. It launched its successful console-handheld hybrid Switch console in March 2017. And now it can benefit from being off the cycle of Microsoft and Sony, which both launched new machines this year. While the PlayStation 5 and Xbox Series X/S were in short supply this holiday season, Nintendo probably cleaned up with plentiful supplies of the Nintendo Switch.

6) Amazon, Facebook, and Microsoft will join Google in launching cloud gaming services

Letter grade: A

Cloud gaming has come a long way since OnLive gave up the ghost. Google launched its cloud gaming service Stadia in November 2019. But it had a very slow launch, and that left the door open for rivals. In this prediction, all three of the rivals came through with their own cloud gaming service launches. Microsoft debuted Project xCloud; Facebook did a small launch of its cloud gaming service, which evolved from its acquisition of startup PlayGiga in Spain; and Amazon launched its Luna service. On top of that, Nvidia finally formally launched its GeForce Now cloud gaming service.

7) Big companies and VCs will continue to invest in game companies

Letter grade: A+

While the pandemic made 2020 miserable for many of us, gaming prospered. And game venture capital firms multiplied. March Capital launched a $60 million gaming fund, Griffin Gaming Partners launched a $235 million fund, and by the end of 2020 we had more than 30 game VC funds investing in games around the world.

InvestGame, which tracks game investments, said more than 100 game studios were funded in the first nine months of 2020. And if you add the money raised together with the acquisitions, the total value of deals in 2020 exceeded $20.5 billion, according to InvestGame. I aced that prediction, but something else happened that I didn’t expect.

Gaming prospered in the pandemic as people turned to games as a distraction and for remote socializing. That opened a window for initial public offerings and SPACs (special purpose acquisition corporations) for game companies. Unity went public and saw its market value rise to $52 billion. Skillz went public via a SPAC while Roblox and Playtika filed to go public.

8) Esports companies will continue to soar in viewers, valuations, and acquisitions — but not profits

Letter grade: A

This prediction proved accurate, but not in the way I expected. Esports companies were hit with a broadside when the pandemic arrived and led every company to cancel their physical events. But the esports industry recovered as the audiences shifted to watching matches online, in a digital-only format. Riot Games went ahead and launched its Valorant title in the pandemic, and it kicked off esports tournaments for the anti-Counter-Strike game by the end of 2020.

Quantum Tech Partners still expects esports to generate a lot of deals and acquisitions going forward, and new esports holding companies have emerged to acquire esports properties. And yes, nobody is really bragging about the buckets of profits they’re making from esports yet.

9) VR will have its biggest games yet, but will continue to struggle

Letter grade: A

We had some great games debut in 2020 on virtual reality platforms. Facebook launched its Oculus Quest 2 headset, and Valve came out with its Valve Index. Respawn Entertainment’s Medal of Honor: Above and Beyond and Valve’s Half-Life: Alyx were among the triple-A games that debuted for VR during the year.

But the consumer market for VR continues to struggle. VR arcades were wiped out during the year due to the pandemic. Facebook is doing its part by acquiring struggling VR studios and launching new hardware at lower prices. But the enterprise is keeping VR going as full immersion is extremely valuable to companies that are trying to train and educate their personnel. Let’s hope that VR hangs in there until the masses truly arrive.

10) Augmented reality glasses will become more practical

Letter grade: D

There was small progress on augmented reality this year, but not enough to warrant a good grade on this prediction. Apple didn’t announce its plans to go into this market. And while Facebook said it will launch AR glasses in 2021, it didn’t actually introduce any new hardware in 2020. We still expect great things from companies that are investing in the tech, such as Qualcomm and Niantic. But 2020 wasn’t the year for AR.

11) Regulatory forces will gather momentum

Letter grade: A

The Federal Trade Commission has been investigating game loot boxes and microtransactions for deceiving consumers and spawning addictive gambling-like behaviors. Regulators didn’t act against game companies this year, but the concern about regulation is growing. Sheldon Evans, assistant professor of law at St. John’s University in New York, wrote a paper on how states should crack down on loot boxes as a form of gambling. The state of Washington has begun treating social casino games as leading to possible gambling addictions. Congress went after the big tech companies for antitrust violations, but gaming could be the next target. Add to that China’s own crackdown on making sure games are registered — and forcing Apple to delete tens of thousands of games that weren’t in compliance — and you can see the effect that governments around the world are having on gaming.

12) Subscription gaming will gather steam

Letter grade: A

Microsoft made good headway toward its goal of creating the “Netflix of games.” It has moved fast to add premium games to its Xbox Game Pass Ultimate subscription service. And its overall subscription service is turning into a juggernaut. In September, the company reported that its Xbox Game Pass subscriptions grew 50% to 15 million in six months. Apple Arcade now has a full year under its belt, and Stadia does as well. Consumers are going to have a lot of choice when it comes to subscription services, and that’s a good thing.

13) Intellivision will be the wild card of 2020

Letter grade: F

Intellivision delayed the launch of its Amico family game console from October 2020 to April 2021. And with that, it skewered my prediction about a 2020 wild card launch. I’m still expecting good things from Tommy Tallarico’s retro project, but it better live up to its family focus more than ever, now that it is coming out after the PS5 and the Xbox Series X/S, which will be in plentiful supply by April.

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