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Making Moves in the Gaming Market

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Making Moves in the Gaming Market

Gaming is a massive and hard-to-ignore market, but its continued rise has eluded many companies.

Though it has grown into a hundred-billion-dollar market, major tech giants and conglomerates had avoided entering the gaming sector in the past. It was seen as a very difficult market to succeed in, and rightfully so, with many commercial failures and failed investments.

But despite lackluster console launches like Nokia’s N-Gage and losses on big-name games like Square Enix’s Marvel’s Avengers, the gaming market is making more money than ever before, and the majors are starting to enter the playing field.

Today’s infographic from eToro shines a spotlight on the major moves and ongoing developments happening in the gaming market.

The Streaming Wars: Gaming Edition

Similar to the current fight for media supremacy in other mediums, the new gaming wars are focused on streaming and mobile.

One reason is that mobile is far and away the largest segment of the gaming market, and the fastest growing as well. At an estimated $85 billion, sales generated from mobile gaming will account for more than 50% of gaming revenue in 2020.

At the same time, mobile is one of the many sectors targeted by streaming services that can reach multiple devices (while console launches or exclusives limit competitors to a single device). The influx of cloud-based streaming services and their consistent subscription revenues have created a scramble to become the “Netflix” of gaming.

Enter traditional plays like Sony and Microsoft and tech giants Apple, Google, and Amazon. Each has launched either a cloud streaming service for games or a game subscription service, and in many cases a combination of both.

CompanyServiceTypeLaunched (Year)
Electronic ArtsEA PlayGame Subscription2014
SonyPlayStation NowCloud Gaming2015
MicrosoftXbox Game PassGame Subscription2017
AppleApple ArcadeGame Subscription2019
GoogleGoogle Play PassGame Subscription2019
GoogleStadiaCloud Gaming2019
NvidiaGeForce NowCloud Gaming2020
MicrosoftxCloudCloud Gaming2020
AmazonLunaCloud Gaming2020

And with others like Walmart and Verizon considering their own gaming services, the field might become even wider in the near future.

Massive Acquisitions and Investments

While new companies are entering the gaming space, existing players are solidifying their positions.

Similar to what’s happening in television and film, one of the big markers of the gaming industry’s growth over the last decade is the increasing value of intellectual property and the ongoing drive to consolidate.

It’s especially notable when investments once considered outrageous have quickly recouped themselves. When Microsoft purchased Minecraft developer Mojang for $2.5 billion in 2014, the sandbox development game had sold more than 50 million copies. Fast forward to 2020, and Minecraft has sold over 200 million copies with almost 132 million monthly active users.

And Microsoft isn’t alone in buying third-party studios. Sony, Electronic Arts, and Activision Blizzard have all been purchasing other developers. Social game juggernaut Zynga has continued to buy rival mobile games, and Chinese giant Tencent’s 2016 acquisition of Clash of Clans developer Supercell was the most expensive ever at $8.6 billion.

Other companies are finding different avenues to join the fray. Amazon purchased streaming service Twitch for $970 million in 2014, which seems to have paid off with more than $230 million in yearly ad revenue by 2018, despite the company hoping for double that figure.

Meanwhile, Facebook opted to enter the nascent virtual reality gaming space with a $3 billion acquisition of VR device maker Oculus in 2014, though it has still far from recouped that investment.

Gaming Valuations Keep Climbing

The biggest reason new and old players alike are trying to enter the gaming market is simple: money in gaming keeps growing.

The largest gaming companies in the West, Activision Blizzard and Electronic Arts, saw multibillion-dollar revenues climb by more than 15% from 2019 to 2020 according to company earnings. In Asia, Nintendo saw an 80% jump in revenues over the same period, while the largest gaming and tech conglomerate Tencent saw a year-over-year increase of 29% for Q2 2020.

On one hand, the catalyst of COVID-19 keeping potential consumers at home and more willing to engage with games has been a boon to the market. On the other, those developments were already underway before the pandemic began, with exponential growth in subscription and recurring revenues.

That’s why investors are eager to capitalize on the market. Game and software developer Epic Games, which scored massive successes with Fortnite and its Unreal game development engine, raised $1.78 billion in capital investments in 2020 for a valuation of $17.3 billion before a potential IPO.

And the esports market is no exception. North America’s professional League of Legends league is projected to become fully profitable in 2021, and franchise spots for teams that cost up to $25 million are now worth upwards of $100 million. Big-name advertisers including Mastercard, Nike, Verizon, and BMW are partnering with either the league or teams directly.

Considering gamers make up an estimated 34% of the global population, and more developments on the horizon for the gaming market including new consoles and mediums, the industry’s rise isn’t expected to slow down anytime soon.

How Can Investors Take Part?

eToro’s InTheGame CopyPortfolio* gives investors direct access to the growing gaming market.

Curated by experienced and proven investment teams, the thematic portfolio offers exposure to a broad range of developers and companies invested in gaming, with no management fees.

*Your capital is at risk.
CopyPortfolios is a portfolio management product, provided by eToro Europe Ltd., which is authorised and regulated by the Cyprus Securities and Exchange Commission.

CopyPortfolios should not be considered as exchange traded funds, nor as hedge funds.

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More Than Precious: Silver’s Role in the New Energy Era (Part 3 of 3)

Long known as a precious metal, silver in solar and EV technologies will redefine its role and importance to a greener economy.

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Silver More Than Precious

Silver’s Role in the New Energy Era (Part 3 of 3)

Silver is one of the first metals that humans discovered and used. Its extensive use throughout history has linked its name to its monetary value. However, as we have advanced technologically, so have our uses for silver. In the future, silver will see a surge in demand from solar and electric vehicle (EV) technologies.

Part 1 and Part 2 of the Silver Series showcased its monetary legacy as a safe haven asset as a precious metal and why now is its time to shine.

Part 3 of the Silver Series comes to us from Endeavour Silver, and it outlines silver’s role in the new energy era and how it is more than just a precious metal.

A Sterling Reputation: Silver’s History in Technologies

Silver along with gold, copper, lead and iron, was one of the first metals known to humankind. Archaeologists have uncovered silver coins and objects dating from before 4,000 BC in Greece and Turkey. Since then, governments and jewelers embraced its properties to mint currency and craft jewelry.

This historical association between silver and money is recorded across multiple languages. The word silver itself comes from the Anglo-Saxon language, seolfor, which itself comes from ancient Germanic silabar.

Silver’s chemical symbol, “Ag”, is an abbreviation of the Latin word for silver, argentum. The Latin word originates from argunas, a Sanskrit word which means shining. The French use argent as the word for money and silver. Romans bankers and silver traders carried the name argentarius.

While silver’s monetary meanings still stand today, there have been hints of its use beyond money throughout history. For centuries, many cultures used silver containers and wares to store wine, water, and food to prevent spoilage.

During bouts of bubonic plague in Europe, children of wealthy families sucked on silver spoons to preserve their health, which gave birth to the phrase “born with a silver spoon in your mouth.”

Medieval doctors invented silver nitrate used to treat ulcers and burns, a practice that continues to this day. In the 1900s, silver found further application in healthcare. Doctors used to administer eye drops containing silver to newborns in the United States. During World War I, combat medics, doctors, and nurses would apply silver sutures to cover deep wounds.

Silver’s shimmer also made an important material in photography up until the 1970s. Silver’s reflectivity of light made it popular in mirror and building windows.

Now, a new era is rediscovering silver’s properties for the next generation of technology, making the metal more than precious.

Silver in the New Energy Era: Solar and EVs

Silver’s shimmering qualities foreshadowed its use in renewable technologies. Among all metals, silver has the highest electrical conductivity, making it an ideal metal for use in solar cells and the electronic components of electric vehicles.

Silver in Solar Photovoltaics

Conductive layers of silver paste within the cells of a solar photovoltaic (PV) cell help to conduct the electricity within the cell. When light strikes a PV, the conductors absorb the energy and electrons are set free.

Silver’s conductivity carries and stores the free electrons efficiently, maximizing the energy output of a solar cell. According to one study from the University of Kent, a typical solar panel can contain as much as 20 grams of silver.

As the world adopts solar photovoltaics, silver could see dramatic demand coming from this form of renewable energy.

Silver in Electric Vehicles

Silver’s conductivity and corrosion resistance makes its use in electronics critical, and electric vehicles are no exception. Virtually every electrical connection in a vehicle uses silver.

Silver is a critical material in the automotive sector, which uses over 55 million ounces of the metal annually. Auto manufacturers apply silver to the electrical contacts in powered seats and windows and other automotive electronics to improve conductivity.

A Silver Intensive Future

A green future will require metals and will redefine the role for many of them. Silver is no exception. Long known as a precious metal, silver also has industrial applications metal for an eco-friendly future.

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Visualizing All the Known Copper in the World

Are we running out of copper? This graphic from Trilogy Metals paints a clear picture of all the copper in the world, above and underground.

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All the Copper in the World

Visualizing All the Known Copper in the World

Copper has many important applications in the modern economy. From smartphones and cars, to homes and hospitals, we use the metal almost everywhere, especially with renewable energy.

Often, consumers take for granted the accessibility to modern technology without the thought of where the materials come from or their impact on the environment. The world and its resources are finite and confined by both geography and the technology used to extract resources.

As governments and economies struggle to achieve a sustainable balance between humanity’s material impact and the health of the planet, knowing the availability of resources will become a critical pivot for achieving and maintaining that balance.

Copper is one such resource—and today’s graphic from Trilogy Metals outlines all the copper ever mined and what known resources still exist on Earth.

Are we running out of copper?

Above Ground Copper Resources

The production of mined copper has increased dramatically over the last two decades, From 9.8 million metric tons in 1995 to 20 million metric tons in 2019, a 104% rise over 25 years.

A total of 700 million metric tons of copper have been mined throughout history. Based on the 2019 average price of $6,042/metric ton, that’s worth $4.2 trillion—more than the value of Apple and Amazon combined.

Chile has been the source of the majority of the world’s copper and the biggest copper mining nation. Together, Chile, Peru, and China account for 48% of current global copper production.

RankingCountryMine Production 2019 (Ktons)CountryReserves 2019 (Ktons)
#1Chile5,600Chile200,000
#2Peru2,400Peru87,000
#3China1,600Australia87,000
#4United States1,300Russia61,000
#5Congo1,300Mexico53,000
#6Australia960United States51,000
#7Zambia790Indonesia28,000
#8Mexico770China26,000
#9Russia750Kazakhastan20,000
#10Kazakhastan700Congo19,000
#11Indonesia340Zambia19,000
Other Countries3,800Other Countries220,000
World Total20,000World Total870,000

Source: USGS

As we enter the era of renewable energy, electric vehicles, and see more global economic growth, the demand for copper will continue to rise. In fact, the Copper Alliance projects an increase of 50% in just the next 20 years.

Are We Running Out of Copper? Not So Soon

Although a large chunk of the Earth’s copper is already above ground, there’s still more to mine.

According to the USGS, identified copper resources amount to 2.1 billion metric tons, with a further 3.5 billion metric tons in undiscovered resources.

At current production rates, it would take about 105 years for us to use all of it and this does not even account for recycling or new discoveries. Copper is 100% recyclable, and nearly all of the 700 million metric tons of mined copper is still in circulation. With this in mind, it’s safe to say that we won’t be running out of copper anytime soon.

Despite copper’s apparent abundance, the red metal is expensive to actually get out of the ground. As a result, the supply of copper has often fallen short in meeting its rising demand. This, in addition to falling resource grades in Chile, the largest producer of copper, emphasizes the need for new discoveries and mines.

While there are known reserves of copper above the ground, the Earth remains largely unexplored because of the inability to explore for minerals in the depths of the oceans and other planets. As the readily available supply of copper becomes scarce, the incentive to mine currently uneconomic copper increases.

A Mineral Intense Future

Most consumers take the immediate availability of materials such as copper and other metals for granted, with little thought about whether there is enough.

But it’s important to remember that these materials are as finite as the dimensions of the Earth. In this material world, understanding what is and what is not available is critical for a sustainable future here on Earth.

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