The Attention Economy Shifts: Why Video Games Are Losing Ground
The video game industry, once a seemingly unstoppable force in entertainment, is facing a critical challenge: a shrinking share of people’s time, and money. A new report by Epyllion, led by Matthew Ball, reveals a concerning trend – gamers are increasingly diverting their attention and spending to alternative forms of entertainment, including social video, online gambling, and even adult content.
The Post-Pandemic Decline in Gaming
The boom experienced during the pandemic is fading. Data from the “Major Market 8” (USA, Japan, South Korea, UK, Germany, France, Canada, and Italy) shows a decline in gaming participation. In the US, 2.5 to 4 percent of players have stopped gaming, while Canada has seen one in six players exit the hobby since the pandemic. This translates to a significant drop in spending – an $8 billion decrease in console and PC spending across these markets since 2020/2021.
Where is the Money Going?
Despite the overall decline in gaming spend, total spending across the “Major Market 8” remains high, indicating that consumers aren’t simply cutting back on entertainment. Instead, their money is flowing towards other options. Roblox, for example, accounts for 67 percent of net growth in entertainment spending. But the biggest shifts are happening in more controversial areas.
The Rise of Alternative Entertainment
The Epyllion report identifies several key competitors vying for consumers’ attention:
- Social Video: TikTok consumption is up 39 million hours per day in the US compared to pre-pandemic levels.
- Creator Platforms: Platforms like OnlyFans are attracting significant spending, with American consumers spending roughly $5 billion in 2025.
- Crypto and Prediction Markets: The fluctuating popularity of cryptocurrencies continues to draw attention and investment. Prediction markets saw 1.5 million bets placed daily in Q4 2025.
- Online Gambling: Online sports betting and iGaming (online casinos) are experiencing explosive growth. US net losses from sports betting exceeded $17 billion in 2025, a 35x increase from 2019. Globally, losses in iGaming reached $54 billion, representing 45 percent of all global gaming spending.
The report emphasizes that the issue isn’t simply a trade-off between gaming and other activities. it’s that these alternatives are capturing a growing share of consumers’ overall entertainment budget.
Mobile Gaming: A Bright Spot, But Not Enough
Mobile gaming remains a relative bright spot, with US annual growth still above 12 percent compared to 2020. It now surpasses console spending. However, this growth isn’t enough to offset the declines in PC and console gaming.
Implications for the Future of Gaming
The shift in the attention economy has significant implications for the future of the video game industry. Developers and publishers will need to adapt to a more competitive landscape and locate new ways to engage players. This could involve:
- Innovation in Game Design: Creating more compelling and immersive gaming experiences.
- New Business Models: Exploring alternative monetization strategies beyond traditional game sales.
- Cross-Platform Integration: Seamlessly integrating gaming with other forms of entertainment.
- Focus on Community: Building strong communities around games to foster player loyalty.
Did you grasp?
iGaming losses now account for 21 percent of all US video game spend.
FAQ
Q: Is the video game industry dying?
A: No, but it is facing significant challenges and needs to adapt to a changing entertainment landscape.
Q: What is driving the decline in gaming?
A: Increased competition from other forms of entertainment, including social video, online gambling, and creator platforms.
Q: Is mobile gaming still growing?
A: Yes, mobile gaming remains a bright spot, but its growth isn’t enough to offset declines in other segments.
Pro Tip
Game developers should focus on creating unique and engaging experiences that differentiate their products from the growing number of entertainment options available to consumers.
What are your thoughts on the future of gaming? Share your opinions in the comments below!
