More money is now spent on DLC and subscriptions than video games

Everyone wants to be the next Fortnite (pic: Epic Games)

If you’re confused as to why publishers are in a sudden rush to make live service games there’s a simple answer: that’s where the money is.

We’re barely more than a month into 2021 and already the world of gaming seems to have been turned upside down. Not only have the acquisitions by Microsoft and Sony reset the map for the entire industry but there’s been a sudden, and seemingly unexplained, interest in live service games.

Live service titles, also referred to as a games as a service (GAAS), like Fortnite and Destiny 2 are hardly new concepts but all of a sudden every publisher seems to be smitten with them. Everyone from Ubisoft to Sony is suddenly promising to release multiple titles as soon as possible, even when they’ve had little or no prior experience with them.

There’s a simple explanation for this and it’s summarised in the tweet below, from NPD analyst Mat Piscatella, where he points out that the majority of revenue from video games now comes from DLC, microtransactions, and subscriptions – not the actual games.

According to NPD’s data, which doesn’t include mobile games content, video games themselves only accounted for 40% of the money spent in the industry, during the last three months of the year in the US.

As shocking as it is to see such a figure it’s not actually that surprising, as games like FIFA long ago started making more money from microtransactions than they do the games alone.

More: Games news

Sifu PS5 review – aging into it

Google giving up on Stadia claims report – will try and sell tech to other companies

GTA: The Trilogy remasters sold 10 million copies despite ‘quality lapses’

The data also makes it very clear why there’s a sudden interest in live service games from publishers that have traditionally had little to do with them.

Much of Sony’s success in the previous generation has come from single-player games with little or no microtransactions, but recently they announced they have at least 10 live service titles due for release before 2026.

Ubisoft and even PlatinumGames have similar plans, and you can expect almost every other publisher to follow suit sooner or later.

The one downside to live service games is that their success is much harder to guarantee than traditional games which, given they also tend to be cheaper to make, explains why companies are so keen to produce a lot of them at once – with the hope that at least one will prove a hit.

Also, as Piscatella himself points out, this doesn’t mean that traditional games are doing worse than they used to, just that the whole market is expanding for every type of product.

Email gamecentral@metro.co.uk, leave a comment below, and follow us on Twitter.

MORE : Jade Raymond’s Haven studio is making one of the PS5’s new live service games

MORE : Phil Spencer sends Platinum Games flowers as Bayonetta dev turns focus to live service titles

MORE : PS5 is doomed if it turns its back on single-player – Reader’s Feature

Follow Metro Gaming on Twitter and email us at gamecentral@metro.co.uk

For more stories like this, check our Gaming page.