Trump’s Win: DOOM or BOOM for gaming? – Games Growth with Upptic

Dive into the potential impact of a second Trump presidency on the gaming industry. Games Growth with Upptic hosts Warren Woodward and Xander Agosta touch on emerging trends in legacy gaming, Web3 and crypto, artificial intelligence (AI), and ad tech. Here are some of the key takeaways from the episode.

Macro-Economic Policies and Their Expected Impact on Gaming

Trump’s second administration is expected to foster an environment conducive to mergers and acquisitions (M&A) with relaxed regulatory intervention – which could increase the scale and frequency of M&A within the gaming industry. However, the administration’s expected tariffs are likely to impact hardware like computers, phones, and gaming consoles – which are often manufactured abroad. This would likely impact costs for gaming companies and their consumers.

Legacy Gaming: Growth Through Consolidation and Innovation

In the realm of legacy gaming — spanning mobile, PC, and console platforms — expect an increase in M&A as companies vie for survival in a challenging, high-cost environment. Rising ad distribution costs and a 30% revenue cut from distribution platforms such as Apple and Google are expected to drive consolidation in this sector. However, with lower interest rates, investment capital might become more accessible, potentially benefiting smaller and mid-sized studios. AI will also play a role in empowering smaller studios to become competitive, thanks to increased efficiency and reduced development costs.

Emerging Gaming Segments: Crypto, Web3, and AI

A second Trump Administration is likely to heavily impact emerging gaming segments and related industries.

Pro-Crypto Policies: A Boost for Web3 and Gaming Innovation

Under the Trump administration, cryptocurrency and Web3-based gaming are anticipated to benefit from favorable policies and a crypto-friendly regulatory environment. Trump has pledged to make the U.S. a “crypto capital,” with potential plans for appointing pro-crypto regulators and integrating crypto assets into national economic strategies. This shift could accelerate growth in Web3 gaming – though concerns remain about whether the token-focused monetization models of web3 games themselves can consistently deliver the kind of gaming experiences needed to see the sector grow sustainably.

The AI Boom and Small Studios’ Competitive Edge

AI technology could be transformative for small, agile studios. While Trump’s anticipated repeal of recent AI-related executive orders could lead to a laissez-faire approach to AI development, this could empower small gaming studios to leverage AI-driven efficiencies, further democratizing game development. However, without regulations, AI advantages may disproportionately benefit tech giants with extensive datasets, potentially consolidating power within an already concentrated sector.

Autonomous Vehicles: A Niche but Growing Gaming Platform

One unique prediction is the potential impact of autonomous vehicles on gaming, as these could open up more gaming time for consumers. Though still niche, autonomous vehicles are increasingly visible on U.S. roads, particularly in tech-centric areas like San Francisco. This new space could ultimately become a valuable platform for gaming as regulations ease and more players enter the autonomous driving market.

Ad Tech and Growth Marketing: Dominance of Big Tech

In growth marketing and ad tech, there is a likelihood of increased spending on ads as the economy grows. However, with a pro-business administration favoring fewer restrictions on big tech, major ad networks like Google, Apple, and Meta are expected to continue consolidating power. Ad tech innovations may emerge, but the “rich get richer” dynamic within the ad ecosystem is expected to persist. One possible disruption in the ad tech landscape could come from blockchain-based ad networks, which could decentralize control and potentially democratize data ownership. However, this remains speculative, with many market dynamics still favoring established tech giants.

A Period of Opportunity and Challenge

The next few years under Trump’s second administration could be transformative for the gaming industry. While pro-business policies may drive investment and innovation, they could also intensify competition and consolidate power within big tech. Emerging technologies like AI, Web3, and autonomous vehicles present exciting opportunities for growth and innovation, but the road ahead will require both adaptability and resilience for smaller and mid-sized players in a rapidly evolving landscape.