Some analysis from research firm MIDiA: Earlier this month Electronic Arts (EA) reported disappointing quarterly results, now Activision has laid off nearly 800 staff, mostly in marketing and sales. As MIDiA has reported multiple times before, engagement has declined throughout the sector, suggesting that the attention economy has peaked. Consumers simply do not have any more free time to allocate to new attention seeking digital entertainment propositions, which means they have to start prioritizing between them.
This downward trend in engagement has persisted for a while now, and the latest quarterly results from some major games publishers confirm that a revenue slowdown will ultimately follow consumer behaviour. Arguably sooner than most of the games industry would have thought. Publishers will be quick to blame declining engagement and revenues on Fortnite. While the title indeed intensified the manifestation of the peak attention economy dynamics among gamers, the coming slowdown is part of a much bigger challenge — how to capture attention in an increasingly attention-scarce landscape.
Top publishers are facing several headwinds at the same time. Fortnite is only one of them, and arguably one of the less harmful ones to the long-term outlook of the games industry: Fortnite’s model utilises the attention economy dynamics: It’s a high-grade gaming experience and it’s free to play, which means there is little barrier for consumers to allocate attention to, compare to its paid counterparts. While it has undoubtedly cannibalised some revenue and engagement from other major publishers, Fortnite engagement still contributes to the bottom line of the global games industry.
More gamers engage with games videos and events than Fortnite: Not only is engagement declining across mobile, PC and console gaming, at the same time, video is winning the race against gaming in capturing attention on multipurpose devices such as PC.