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HomePOSTVideo game industry is booming with continued revenue

Video game industry is booming with continued revenue

Video game engagement continues to grow and that could mean big returns for investors interested in the space, Samantha Greenberg, chief investment officer and managing partner at Margate Capital Management, told CNBC.

As technology expands so will video content, products, virtual reality, special events and video game tournaments. These are just some of the ways the industry is turning into a “recurring revenue model” and capitalizing on increased demand, Greenberg said.

“That means that the initial purchase of a game is just the beginning of a game’s monetization,” Greenberg said Wednesday on “Closing Bell.”

Whereas the industry “used to be a very hit-driven business tied to new game releases,” she said, now investors have a “more predictable and valuable earnings stream.”

Gamers around the world will likely spend around $138 billion on games this year, according to Newzoo’s Global Games Market Report. The market research firm tracks usage and trends of video games, mobile and esports. The figure represents a 13.3 percent increase year over year, or an extra $16.2 billion.

Competitive esports events are increasing as well. PGI 2018, or PlayerUnknown’s Battlegrounds, a gaming tournament, will bring competitors from around the world to Berlin later this month for their chance at a $2 million prize, the largest in the tournament’s history.

Greenberg predicts the video gaming trend will only accelerate, as engagement grows with young people, women and on college campuses. She said more than half of teenagers play video games and for several hours each day. Video games are also cheaper to consume than cable television or going to the movies, she said.

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