Two factors are going to push the gaming sector this year: Mobile, which includes tablet gaming, and online casino gaming. Both these factors drove gaming in 2012, and they look to keep on pushing in 2013.
As an example, the highest-profile deal of last year was IGTs $500M acquisition of Doubledown, a leading online casino game provider.
Expect to see this accelerate, driven by changes in US gambling regulations. Zynga has applied for an online gambling license, which could prove to be the cure for their IPO blues. Certainly if it all comes together, their decline wont continue in the face of the massive benefits of casino gaming.
Industry-wide, we continue to see a shift from traditional retail to online downloads as distribution. Digital revenue will surpass that of brick-and-mortar sales in 2013. Valve was the front runner here, but look for Apple, Google, and Microsoft to start pushing more in this realm as well.
Well see Smart TV gaming take a big step forward this year, with better technology like game controllers, better games, better voice recognition, and improved gesture technology, leading to more Wii-style games without a console. Look for innovate companies in these realms to be hot M&A targets.
This will also be the year for casual, mobile, and tablet games to step up from their realm as shallow puzzle/adventure/etc type titles, and begin to show more substance and quality.
I also think there will be a hidden deal driver for many transactions we see this year, and that will be a push for customer loyalty or stickiness. Look for sports games, lifestyle games, and casino franchises to push for mobile and casual customer loyalty and higher levels of engagement, to capitalize on gamers and their niche sensitivities. This will especially be evident in the casino space, as casinos try to expand their customer loyalty clubs to a wider market.
I expect that 2013 will be a dynamic year for gaming, and you should expect a couple of substantial IPOs, even though Wall Street still doesnt know what to do with gaming companies. I think that, in turn, will foster some substantial mergers and acquisitions as well. Well be sure to revisit this space soon and see how the market is doing, and how my predictions are holding up.