Infographic: Making Moves in the Gaming Market
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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?

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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.

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Ranked: Emissions per Capita of the Top 30 U.S. Investor-Owned Utilities

Roughly 25% of all GHG emissions come from electricity production. See how the top 30 IOUs rank by emissions per capita.

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Emissions per Capita of the Top 30 U.S. Investor-Owned Utilities

Approximately 25% of all U.S. greenhouse gas emissions (GHG) come from electricity generation.

Subsequently, this means investor-owned utilities (IOUs) will have a crucial role to play around carbon reduction initiatives. This is particularly true for the top 30 IOUs, where almost 75% of utility customers get their electricity from.

This infographic from the National Public Utilities Council ranks the largest IOUs by emissions per capita. By accounting for the varying customer bases they serve, we get a more accurate look at their green energy practices. Here’s how they line up.

Per Capita Rankings

The emissions per capita rankings for the top 30 investor-owned utilities have large disparities from one another.

Totals range from a high of 25.8 tons of CO2 per customer annually to a low of 0.5 tons.

UtilityEmissions Per Capita (CO2 tons per year)Total Emissions (M)
TransAlta25.816.3
Vistra22.497.0
OGE Energy21.518.2
AES Corporation19.849.9
Southern Company18.077.8
Evergy14.623.6
Alliant Energy14.414.1
DTE Energy14.229.0
Berkshire Hathaway Energy14.057.2
Entergy13.840.5
WEC Energy13.522.2
Ameren12.831.6
Duke Energy12.096.6
Xcel Energy11.943.3
Dominion Energy11.037.8
Emera11.016.6
PNM Resources10.55.6
PPL Corporation10.428.7
American Electric Power9.250.9
Consumers Energy8.716.1
NRG Energy8.229.8
Florida Power and Light8.041.0
Portland General Electric7.66.9
Fortis Inc.6.112.6
Avangrid5.111.6
PSEG3.99.0
Exelon3.834.0
Consolidated Edison1.66.3
Pacific Gas and Electric0.52.6
Next Era Energy Resources01.1

PNM Resources data is from 2019, all other data is as of 2020

Let’s start by looking at the higher scoring IOUs.

TransAlta

TransAlta emits 25.8 tons of CO2 emissions per customer, the largest of any utility on a per capita basis. Altogether, the company’s 630,000 customers emit 16.3 million metric tons. On a recent earnings call, its management discussed clear intent to phase out coal and grow their renewables mix by doubling their renewables fleet. And so far it appears they’ve been making good on their promise, having shut down the Canadian Highvale coal mine recently.

Vistra

Vistra had the highest total emissions at 97 million tons of CO2 per year and is almost exclusively a coal and gas generator. However, the company announced plans for 60% reductions in CO2 emissions by 2030 and is striving to be carbon neutral by 2050. As the highest total emitter, this transition would make a noticeable impact on total utility emissions if successful.

Currently, based on their 4.3 million customers, Vistra sees per capita emissions of 22.4 tons a year. The utility is a key electricity provider for Texas, ad here’s how their electricity mix compares to that of the state as a whole:

Energy SourceVistraState of Texas
Gas63%52%
Coal29%15%
Nuclear6%9%
Renewables1%24%
Oil1%0%

Despite their ambitious green energy pledges, for now only 1% of Vistra’s electricity comes from renewables compared to 24% for Texas, where wind energy is prospering.

Based on those scores, the average customer from some of the highest emitting utility groups emit about the same as a customer from each of the bottom seven, who clearly have greener energy practices. Let’s take a closer look at emissions for some of the bottom scoring entities.

Utilities With The Greenest Energy Practices

Groups with the lowest carbon emission scores are in many ways leaders on the path towards a greener future.

Exelon

Exelon emits only 3.8 tons of CO2 emissions per capita annually and is one of the top clean power generators across the Americas. In the last decade they’ve reduced their GHG emissions by 18 million metric tons, and have recently teamed up with the state of Illinois through the Clean Energy Jobs Act. Through this, Exelon will receive $700 million in subsidies as it phases out coal and gas plants to meet 2030 and 2045 targets.

Consolidated Edison

Consolidated Edison serves nearly 4 million customers with a large chunk coming from New York state. Altogether, they emit 1.6 tons of CO2 emissions per capita from their electricity generation.

The utility group is making notable strides towards a sustainable future by expanding its renewable projects and testing higher capacity limits. In addition, they are often praised for their financial management and carry the title of dividend aristocrat, having increased their dividend for 47 years and counting. In fact, this is the longest out of any utility company in the S&P 500.

A Sustainable Tomorrow

Altogether, utilities will have a pivotal role to play in decarbonization efforts. This is particularly true for the top 30 U.S. IOUs, who serve millions of Americans.

Ultimately, this means a unique moment for utilities is emerging. As the transition toward cleaner energy continues and various groups push to achieve their goals, all eyes will be on utilities to deliver.

The National Public Utilities Council is the go-to resource to learn how utilities can lead in the path towards decarbonization.

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The Road to Decarbonization: How Asphalt is Affecting the Planet

The U.S. alone generates ∼12 million tons of asphalt shingles tear-off waste and installation scrap every year and more than 90% of it is dumped into landfills.

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Road to Decarbonization - How Asphalt is Affecting the Planet

The Road to Decarbonization: How Asphalt is Affecting the Planet

Asphalt, also known as bitumen, has various applications in the modern economy, with annual demand reaching 110 million tons globally.

Until the 20th century, natural asphalt made from decomposed plants accounted for the majority of asphalt production. Today, most asphalt is refined from crude oil.

This graphic, sponsored by Northstar Clean Technologies, shows how new technologies to reuse and recycle asphalt can help protect the environment.

The Impact of Climate Change

Pollution from vehicles is expected to decline as electric vehicles replace internal combustion engines.

But pollution from asphalt could actually increase in the next decades because of rising temperatures in some parts of the Earth. When subjected to extreme temperatures, asphalt releases harmful greenhouse gases (GHG) into the atmosphere.

Emissions from Road Construction (Source) CO2 equivalent (%)
Asphalt 28%
Concrete18%
Excavators and Haulers16%
Trucks13%
Crushing Plant 10%
Galvanized Steel 6%
Reinforced Steel6%
Plastic Piping 2%
Geotextile1%

Asphalt paved surfaces and roofs make up approximately 45% and 20% of surfaces in U.S. cities, respectively. Furthermore, 75% of single-family detached homes in Canada and the U.S. have asphalt shingles on their roofs.

Reducing the Environmental Impact of Asphalt

Similar to roads, asphalt shingles have oil as the primary component, which is especially harmful to the environment.

Shingles do not decompose or biodegrade. The U.S. alone generates ∼12 million tons of asphalt shingles tear-off waste and installation scrap every year and more than 90% of it is dumped into landfills, the equivalent of 20 million barrels of oil.

But most of it can be reused, rather than taking up valuable landfill space.

Using technology, the primary components in shingles can be repurposed into liquid asphalt, aggregate, and fiber, for use in road construction, embankments, and new shingles.

Providing the construction industry with clean, sustainable processing solutions is also a big business opportunity. Canada alone is a $1.3 billion market for recovering and reprocessing shingles.

Northstar Clean Technologies is the only public company that repurposes 99% of asphalt shingles components that otherwise go to landfills.

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