In context: While physical video game sales are still strong -- or, at least, strong enough to justify the expense of making discs -- it's no secret that digital distribution is the way of the future; at least on PC. Digital game sales have picked up significantly over the past few years, likely due to frequent sales, convenience, and the comfortable atmosphere that many digital distribution clients (Steam, in particular) offer users. However, digital distribution might not be on top forever.
According to a report from IHS Markit, an increasing number of consumers are more than happy to give up ownership of their games (even digital "ownership") in favor of cheaper, more convenient alternatives. Indeed, the analysis website says the cloud gaming industry generated a whopping $387 million in "consumer spending" throughout 2018, with Sony leading the charge.
For the unaware, "cloud gaming" typically refers to platforms like Sony's PlayStation Now, Nvidia's GeForce Now, Google Stadia, and the upcoming Project xCloud from Microsoft. Though these services vary in terms of game selection and specific features, they have one thing in common: they don't require users to have powerful consoles or PCs to play the hottest games.
All you need to use them, in most cases, is a solid internet connection and enough cash to cover a small monthly subscription fee. Think of them as the Netflix or Hulu of gaming.
IHS Markit believes this burgeoning industry will grow even further in the coming years: first to over $500 million in total worth by the end of 2019, and then to roughly $2.5 billion by the close of 2023. Markit analyst Piers Harding-Rolls notes that there will likely be "significant lag" between initial industry disruption and widespread adoption of the idea; hence the slower initial forecasted growth (in other words, it will take some time for gamers to get used to the idea).
Obviously, these numbers are just forecasts and not guarantees of what the future will hold. Perhaps gamers at large will reject the lack of control that these cloud gaming services bring to the table, or maybe they will embrace the idea wholeheartedly -- only time will tell.