Gaming and Gambling Markets on The Rise in The Midst of COVID-19 Pandemic
The effects of the COVID-19 pandemic on the global economies have been disastrous so far. In March of 2020, we saw one of the worst value reductions to ever hit the world’s markets. Black Monday on March 9th, followed by Black Tuesday on March 12th, then imaginatively titled Black Monday II on March 16th caused an almost 30% fall in Dow Jones. National banks scrambled to at least mitigate the consequences of the recesses ion, by cutting the interest rates and infusing massive amounts of bail-out money into their economies. In the United States alone, unemployment reached numbers last seen during the Great Depression. Unemployment peaked out in April, with more than 23 million people applying for social security. The rest of the world, with a few exceptions, didn’t fare any better.
However, in the midst of the COVID-19 pandemic, one industry seemed unaffected. Not only that but so far gaming and gambling markets have been on the steady rise since the disease first appeared. The reasons for this discrepancy are numerous.
The Effects of Pandemic on the Gaming Market
Just how dramatic an effect the global pandemic had on the gaming market is best illustrated by the sales number. In August 2020, the sales of games in the United States reached $3.3 billion. That is a 37% increase compared to August 2019. By September, the total value of video game sales was $29.4 billion, 23% more than in the same period last year. Those numbers include games themselves, but also hardware needed to play them, like consoles and equipment for them. A similar situation happened in Japan, where sales of iPhone games soared 44% compared to 2019. In the European Union, the increase was more modest, but still significant at 20%. Gaming companies reaped the benefits of these sale surges. Nintendo reported a profit of $1.4 billion in the second quarter, a five-fold increase from the previous year. Activision saw the number of players for Call of Duty: Warzone skyrocket from 30 million in March to 75 million in August.
Gambling in The Midst of Pandemic
Online casinos also saw a huge surge in their players’ numbers. The lockdowns played a significant role here as well, as people were left with plenty of free time and not enough ways to spend it. But the increase in online gambling also had an economic component. In times of hardship, people often try to improve their situation by gambling. It rarely, if ever, works, but the impetus is just too strong to resist. Left with no job opportunity, they feel forced to search for alternative sources of income and gambling seems like a logical solution. In countries where gambling is illegal, people don’t even have that option. At the end of the day, it is as much as therapy than anything else, since people feel powerless in the face of the global recession. Gambling offers them an important outlet to at least create an illusion of having an income.
Online Gambling Market Surges During the Pandemic
The numbers on the online gambling industry tell a clear story. The industry was already on pace to reach a value of $85 billion by 2023, from %59 billion in 2019. The pandemic has added fuel to this growth and it is now expected that it will be worth $93 billion by the end of 2023. The annual growth of 9.9% has been amended to a projected 12%, mostly due to the effects of the COVID-19 Pandemic. Interestingly, the effects will be still in place even when the pandemic ends. The long-term consequences are predicted to impact gambling until at least 2030, according to some studies. By then, the value of the industry is projected to be almost $186 billion. These are all projections, of course, but so far, they seem to be on pace to come true.
Lockdowns Created A Perfect Storm for Gaming
As millions of people were forced to spend time locked in their homes, gaming provided one of a few outlets. For gamers, the situation offered a perfect excuse to spend even more time playing games. Many other people, who played games casually or didn’t play them at all before, were forced to pick it up in order to keep their sanity. Cooped up in their homes, they were left with an abundance of free time and precious few options on how to spend it. Some people picked up reading or crafts, but gaming was the most convenient. It also served a valuable social function. With no option of meeting their friends, gaming allowed people to socialize online while playing games.
One sector of the gambling industry that was sting hard by the COVID-19 pandemic was sports betting. The reason was simple. One of the measures put in place to combat the spread of the contagion was canceling all sporting events. Most football leagues across the globe ended prematurely, leaving betting fans scant opportunity to place bets. Some leagues, like the Belarusian one, which held out longer saw a massive increase in popularity. In desperation, punters placed bets on teams they probably never heard of before. Google was flooded with searches like “BATE Borisov rooster” and “Dinamo Minsk goalkeeper”. People who preferred betting on horse races were in a similar situation. Horse racing was among the first sports to resume competition behind closed doors in the United Kingdom on May 30th, according to the Government guidance on elite sport. So far, the new measures adopted in January 2021 due to the new strain of the virus in the UK have bypassed both football and racing.