The Future is Here: Regionless Cloud in a Globalizing Game Market
Oct 17, 2023
The Regional Challenge: APAC and LATAM
The gaming industry is booming and is driven by the globalization of games, with the so-called emerging market moving revenues and new success stories amongst game developers taking massive market share from well-established publishers such as EA, Ubisoft, Zynga and more.
In terms of game development, Genshin Impact by HoYoverse is the main point of reference, having been developed out of Shanghai in China with the USA contributing to 20% of its revenue alone (1), Harry Potter: Magic Awakened from Chinese giant NetEase pulling in astronomical revenues from the Americas and Europe (2) and let’s not forget – two of the biggest titles of the past year’s come from Japan, namely From Software’s Elden Ring and Armored Core VI.
As for revenue, it is not just the traditional markets like North America and Europe contributing to this growth. Emerging markets in the Asia-Pacific (APAC) and Latin American (LATAM) regions are becoming increasingly lucrative, with double the growth rate in 2023 from North American and European markets7.
However, this opportunity doesn't come without its set of challenges.
According to “The Great Cloud Reset”, a new Forrester Consulting study, commissioned by Akamai, the complexity and costs associated with cloud hosting in additional regions can soar. Specifically, 58% of game studios to struggle with complexity (3), and 42% struggling with its rising costs. It is a common issue too – with 92% of game devs having to run in multiple regions (4). Given the rise of critical global regions where high-revenue markets are primarily concentrated, these challenges cannot be overlooked when operating games.
The Financial Barrier: High Fixed Costs
Emerging markets are enticing but risky. The excitement of tapping into a new audience comes with the financial burden of high fixed setup and operational costs. These costs often deter game developers, particularly smaller ones, from considering global expansion. Setting up data centers, ensuring compliance with local regulations, and managing a complex web of multi-cloud providers can be prohibitively expensive – due to region-based pricing as noted being a challenge for 62% of all organizations5 including game developers, high entry costs and ongoing operating costs often poorly planned for. The risk outweighs the reward, especially when unsure about the market's potential.
This is true for emerging developers, too – market-specific games have to develop and adapt their games to potential new markets, and even when testing, prohibitive fixed and variable expenses make it a challenge to introduce games to new markets.
The Technical Hurdle: Hosting and Localization
Beyond the financial aspect, there's a technical mountain to climb. Different regions may require other hosting solutions, and localizing a game isn't merely about language translation. It involves adapting to local regulations, with 52% of game developers and publishers noting it an important or critical challenge they currently face (6), currencies, and even social norms.
Each additional requirement multiplies the complexity, requiring specialized skills and resources that many game studios do not possess – a staggering 40% (8) lacking internal resources.
The Innovative Solution: The Concept of Regionless Cloud
What if there were a way to globalize your game without the entanglements of regional limitations? Edgegap introduces the innovative concept of a "regionless" cloud. Providing instant access to over 550+ locations worldwide essentially decouple the idea of cloud resources from geographical limitations. Game developers can deploy their resources closer to the end users, regardless of location. Since 50% of gamers noted latency was their biggest frustration when playing online10, with even 42% exiting the game entirely due to lag (11), proximity hosting imposes itself as critical for a game’s success.
Orchestration is but one part of the equation, as noted by 92% of game developers and publishers (9), a reliable and trusted cloud partner is important/critical - Akamai’s leading global cloud infrastructure brings the expected level of performance, reliability and optimization sought by developers for their online games.
Akamai pioneered CDN (Content Delivery Network) by allowing anyone to distribute their static content worldwide, through a simple platform. They are now pushing boundaries and implement a similar concept with dynamic content like game servers, where those content (game servers) are distributed everywhere through a simple API call. Democratizing the cloud and removing regions, like they did for CDN many years ago.
Pay-Per-Use: The Financial Game Changer
The partnership between Edgegap and Akamai also brings a financial reprieve. With a pay-per-use hosting model, game developers can effectively eliminate the high fixed costs of establishing a presence in a new region. Financial flexibility allows studios to test the waters without going all-in, thereby significantly reducing the risks associated with global expansion.
The Competitive Edge: Unlocking Global Markets
In the gaming industry, the competition isn't just about who has the better game; it's about who can provide a better user experience. The combined solution of Edgegap’s "Regionless" cloud and Akamai's hosting enables developers to offer low-latency, high-quality experiences to users across the globe. Now, you can launch your game in multiple markets simultaneously or in a phased manner without worrying about infrastructural complexities and excessive costs.
A Paradigm Shift for the Industry
This "regionless" approach represents a paradigm shift for the gaming industry. The combination of Edgegap and Akamai's cloud computing services removes the financial and technical barriers to entry and levels the playing field. Smaller game developers previously restricted by resources and high costs can now consider global markets as viable opportunities.
When one of the largest studios in the world, Riot games, publicly disclose using edge computing to improve their player’s experience, it was a matter of time before SaaS platform like Edgegap democratize this architecture and allows every game developers to leverage this new paradigm. While Riot probably has multiple teams of engineers and can afford to spend millions on infrastructure, a turnkey solution like Edgegap and Akamai opens the door to the highest possible quality of infrastructure, through simplicity, ease of use and low cost to all game developers, studios and publishers regardless of sizes and resources available to them.
The collaboration between Edgegap and Akamai is a revolutionary step that changes the traditional narrative around global game launches. By breaking down regional barriers and reducing financial risks, this partnership empowers game developers to think big, act fast, and expand wisely. It heralds a new era where the gaming market is truly global, and opportunities are no longer limited by geography or financial constraints.
By integrating the "regionless" cloud concept with a pay-per-use model, Edgegap and Akamai provide a comprehensive solution that tackles the technical and financial challenges head-on. This collaboration is not just a win-win for these companies; it's a win for the gaming industry as a whole. Welcome to the future of gaming—globalized, optimized, and simplified.
Learn how Akamai's cloud computing services help companies delight gamers with a fast, immersive, personalized experience, empowering developers with an open, user-friendly cloud and achieving budget goals with low egress fees and transparent pricing.
This series is part one of a collaboration between Akamai and Edgegap and leverages “The Great Cloud Reset”, a new Forrester Consulting study, commissioned by Akamai, that surveyed 420 enterprise cloud strategy leaders across the globe. Gaming’s spotlight is available to read here. Edgegap’s “Online Connectivity Report” is also available here.
(1) “Genshin Impact Surpasses $3 Billion on Mobile, Averages $1 Billion Every Six Months” Sensor Tower, Link
(2) “Harry Potter Mobile Games Magic Up $1 Billion in Global Player Spending” Sensor Tower, Link
(3), (4), (5), (6), (8), (9) The Great Cloud Reset – Gaming Industry, a commissioned study conducted by Forrester Consulting on behalf of Akamai
(7) “Global Games Market Report – August 2023 revision” Newzoo, Link
(10), (11) Edgegap & Bryter Research, Online Connectivity Report (2022), Link