According to a report from App Annie Research, 2021 was a record year for both mobile app spending and playtime. During the year, additional growth from popular mobile games such as Roblox, which is held by the fund, and innovative hyper casual games helped mobile video games sales surge 16% year-over-year to $116 billion.1
In 2021, more than 230 mobile apps and games topped $100 million in annual consumer spend; 13 of those surpassed $1 billion. This represents a 20% increase from 2020, where only 193 apps and mobile games reported over $100 million in annual spend with eight over $1 billion.
People aren’t just spending more on mobile games they’re also installing more and spending more in app stores. Total mobile app store spending was up 19% in 2021 at $170 billion. That equates to $320,000 spent per minute. New mobile app downloads increased 5% to 230 billion. This totals 435,000 apps downloaded per minute.
Once downloaded, captivated users are spending roughly 4.8 hours, or one third of their time on the apps. That’s up 30% from 2019. For comparison’s sake, the average American watched 3.1 hours of TV each day in 2021.
In late January, Sony Interactive Entertainment announced plans to acquire Bungie for $3.6 billion. Bungie is the name behind legendary mobile game franchises including Halo and Destiny.2
The New York Times also announced it was buying the hyper casual game Wordle, for just over $1 million. The Times said it would keep Wordle free “initially.3
Two Supercharged Gaming Acquisitions
Take Two Interactive Software expands to mobile video games
Take Two Interactive kicked off the 2022 gaming M&A season when it announced it was buying mobile game developer Zynga, for $12.7 billion. Take Two Interactive is home to some of the most well-loved video games, including Grand Theft Auto, Red Dead Redemption, and NBA 2K.
The acquisition of Zynga marks the company’s first foray into the mobile games market, giving the firm control of the company’s 93 mobile games, which includes the Farmville and Merge franchises, Willy Wonka Slots, Game of Thrones Slots Casino, Harry Potter: Puzzles & Spells, Merge Dragon!, CSR Racing, and Zynga Poker.
Microsoft Corporation and the largest acquisition in gaming
Microsoft Corporation indicated it was acquiring Activision Blizzard for $68.7 billion. The all-cash deal accelerates Microsoft’s growth across mobile video games, PC, console, and the cloud and gives it ownership of global gaming giants like Call of Duty, World of Warcraft, and Diablo.5
It also gives Microsoft a very strong presence in the mobile gaming field through Activision’s gaming arm King. The King franchise includes the hyper casual games Candy Crush, Farm Heroes, and Bubble Witch, which combined, draw in approximately 245 million monthly active users.
HERO ETF: Diversified Investment in the Gaming Industry
Interested in a diversified approach to investing in video games? Evolve E-Gaming Index ETF (TSX Ticker: HERO) may be the right investment for you. HERO ETF gives investors access to equity securities of companies, listed domestically and globally, with business activities in the gaming industry. This ETF invests in companies involved in hardware, software and services relating to the electronic gaming industry. Learn more about this fund by clicking here.
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- “State of Mobile 2022,” App Annie Research, January 12, 2022; https://www.appannie.com/en/go/state-of-mobile-2022.
- “Sony Interactive Entertainment to Acquire Leading Independent Videogame Developer, Bungie,” Sony Interactive Entertainment, January 31, 2022; https://www.businesswire.com/news/home/20220131005684/en/Sony-Interactive-Entertainment-to-Acquire-Leading-Independent-Videogame-Developer-Bungie.
- “Wordle Is Joining The New York Times Games,” The New York Times, January 31, 2022; https://www.nytco.com/press/wordle-new-york-times-games/.
- “Take-Two and Zynga to Combine, Bringing Together Best-in-Class Intellectual Properties and a Market-Leading, Diversified Mobile Publishing Platform, to Enhance Positioning as a Global Leader in Interactive Entertainment,” Zynga, January 10, 2022; https://www.zynga.com/blog/take-two-and-zynga-to-combine/.
- “Microsoft to acquire Activision Blizzard to bring the joy and community of gaming to everyone, across every device,” Microsoft Corporation, January 18, 2022; https://news.microsoft.com/2022/01/18/microsoft-to-acquire-activision-blizzard-to-bring-the-joy-and-community-of-gaming-to-everyone-across-every-device/.