A:

As technology continues to grow at an incomprehensible rate, connections between different tech sectors are only strengthening. The gaming industry’s growth has transcended beyond merely revolutionizing systems and software, as the demand for faster Internet has now become an intricate necessity. This is especially the case with the advent of the newest generations of video game systems, which require an Internet connection to carry out a number of basic functions. The introduction of social media and online streaming services onto these platforms has numerous tech companies attempting to get their piece of the expanding industry. From consumer demands for faster connection speeds, to social interactions, there is no denying that the popularity of online gaming has directly affected the Internet sector.

The most obvious division of the Internet industry that online gaming has influenced is the service-providing sector, which allows for any digital exchange to occur. As Internet providers clearly illustrate with their packages, gaming is a much more involved and straining activity on incoming bandwidth than merely surfing the Web or catching up on email correspondences. As players are interacting, exchanging information and drawing in more data, Internet service providers have taken evident steps to capitalize off the industry. After all, a weak connection will hinder, disrupt or completely ruin the entire experience for a gamer. Any player seeking to venture online will require a strong and constant connection. This leaves gamers with little alternative but to have one of the higher bandwidth packages and hand over more money to the provider.

But this phenomenon is not strictly limited to gaming on these new systems, as online content streaming has also become mainstream. The Xbox One, PlayStation 4 and Nintendo Wii U all offer their share of content streaming. Hulu, Netflix and Amazon Instant Video are just a few of the many outlets that are profiting off gamers and families, who use these consoles to watch their services. While not directly participating in online gaming, any type of streaming requires increased and consistent Internet speed to perform properly. As a result, this is not only benefiting the streaming companies, but the Internet service providers once again. The advent of these numerous media outlets on new video game systems has also helped propel the era of online content streaming forward, as consoles are also being used to watch popular shows and movies.

However, streaming companies are not the only extension services available on these new systems. Social interactions are now a major part of online gaming and have changed how people communicate on the Internet. Gamers previously used online messaging systems and social media outlets to communicate. But now they are able to achieve all of this on gaming systems, via onscreen messaging interfaces or merely through the use of microphones. Although the days of traditional social media sharing and messaging are far from over, it is obvious that there is little use for the now outdated AOL Instant Messenger. However, social media outlets have certainly taken notice, as juggernauts, such as Facebook, have taken advantage of the online gaming boom and now offer gamers a means of directly connecting their accounts. In an increasingly networking industry, tech companies are forming links to further grow their financial aspirations.

RELATED FAQS
  1. What developed countries have the greatest exposure to the Internet sector?

    Find out which developed countries have the greatest exposure to the global Internet sector, lead by global Internet companies ... Read Answer >>
  2. What portion of the global economy is represented by the Internet sector?

    Find out the size of the global Internet sector, how much of the global economy it represents and what businesses are included ... Read Answer >>
  3. How do Internet companies profit if they give away their services for free?

    Learn how companies in the Internet sector make a profit when service, content and user applications are offered at no cost ... Read Answer >>
  4. What are the primary risks an investor should consider when investing in the Internet ...

    Learn what risks to look out for when considering investments in the Internet sector in order to maximize potential profits ... Read Answer >>
  5. What factors are the primary drivers of share prices in the internet sector?

    Learn how economic factors such as interest rates, unemployment and wage growth serve as catalysts for share price movement ... Read Answer >>
  6. What emerging markets are best positioned to benefit from growth in the Internet ...

    Explore which emerging markets are best positioned to benefit from the growth in the Internet sector. The sector continues ... Read Answer >>
Related Articles
  1. Tech

    How To Game The Video Game Industry

    Investopedia explores the business, current developments, future trends of video games industry and how the overall industry makes money.
  2. Tech

    How The Video Game Industry Is Changing

    Video game creation has become increasingly complex, and the cost of creating a game to run on one of the major consoles has risen with this greater complexity.
  3. Tech

    Microsoft to Enable Game Gifting in the Xbox One Store

    Microsoft revealed in a tweet that it will soon let customers gift games via the Xbox One Store.
  4. Tech

    Are Big Budget Video Games Dead?

    More people seem to be gaming on tablets and smartphones over consoles, which means this could be the end of big budget console games.
  5. Investing

    5 Video Game Stocks to Power up your Portfolio

    Learn about some of the biggest players in this multibillion dollar industry!
  6. Insights

    Investors May Love the Fast Action in Video Games

    Video game companies that were once whipsawed by the "ship it and forget it" game cycle, are now thriving as they sell their games digitally.
  7. Investing

    Nintendo to Charge Users for New Online Switch Service

    Nintendo is gearing up to launch a new online service for the Switch in the fall, but this time users will have to pay to play.
  8. Investing

    Game Stop Tanks Over MSFT's 'Netflix for Games'

    Game Stop stock fell after Microsoft announced a Netflix-type service for its Xbox games.
  9. Investing

    Video Game Makers Post Strong March Quarter

    Earnings results show that consumers still love video games but are changing how they access them.
  10. Tech

    Play Video Games; Become A Millionaire

    New ways to benefit from this industry have emerged over the last few years. The best part is, they're very profitable.
RELATED TERMS
  1. Gaming Industry ETF

    Gaming ETFs invest in companies that generate revenue from the ...
  2. Social Media Optimization (SMO)

    The use of social media networks to develop and manage an organization’s ...
  3. Zero-Sum Game

    A situation in which one person’s gain is equivalent to another’s ...
  4. Internet of Things (IoT)

    The Internet of Things (IoT) is a network comprised of physical ...
  5. Social Commerce

    A type of electronic commerce that employs social media to promote ...
  6. Game Changer

    1. A person who is a visionary. 2. A company that alters its ...
Hot Definitions
  1. Gross Domestic Product - GDP

    GDP is the monetary value of all the finished goods and services produced within a country's borders in a specific time period, ...
  2. Debt/Equity Ratio

    The D/E ratio indicates how much debt a company is using to finance its assets relative to the value of shareholders’ equity.
  3. Exchange-Traded Fund (ETF)

    A security that tracks an index, a commodity or a basket of assets like an index fund, but trades like a stock on an exchange.
  4. Net Present Value - NPV

    Net Present Value (NPV) is the difference between the present value of cash inflows and the present value of cash outflows ...
  5. Return On Equity - ROE

    The amount of net income returned as a percentage of shareholders equity. Return on equity measures a corporation's profitability ...
  6. Bond

    A bond is a fixed income investment in which an investor loans money to an entity (corporate or governmental) that borrows ...
Trading Center