Tech giants Sony, Microsoft, and Nintendo are spearheading innovation in the sector, driven by cutting-edge artificial intelligence, seamless cross-platform play, and groundbreaking hybrid gaming devices. Yet the booming popularity of cloud gaming and remastered classic titles is shaking up the competitive landscape, transforming how gamers engage with their favourite pastime.
GlobalData Principal Analyst Rupantar Guha said: “Technological innovation and evolving consumer preferences are driving the progress of console gaming. AI is increasingly used in console gaming, particularly in graphics, game upscaling, and player safety. Cross-platform play is knocking down the barriers between console ecosystems, dramatically improving the player experience.”
Despite its explosive growth, console gaming still trails significantly behind mobile games, which pull in around two and a half times more revenue. But the console space remains fiercely competitive, fuelled by industry heavyweights and supported by a diverse array of game developers, cloud services providers, telcos, and peripheral manufacturers.
The latest consoles from Nintendo, Sony, and Microsoft already have a combined install base of over 250 million units globally. New consoles from Microsoft and Sony are slated for 2028, featuring higher-resolution graphics, advanced cross-platform capabilities, and expanded cloud gaming services. Nintendo’s highly anticipated Switch 2, set for release in 2025, is expected to continue the trend of popular hybrid gaming systems.
Guha warns that cloud gaming could disrupt traditional console sales, potentially reshaping how companies make money from gaming.
"Cloud gaming can allow gaming companies to reach a broader audience. But it also risks reducing demand for traditional hardware," he said.
Gaming giants are also tapping into nostalgia, populating game libraries with remakes and remasters of beloved classics—a profitable strategy that draws in both veteran gamers and newcomers. Indie game studios, celebrated for creative and affordable gaming experiences, are also becoming prime acquisition targets for the industry's biggest players, the report noted.
