TheGamingEconomy’s Daily Digest brings you the prevalent business stories in gaming. In today’s news: XR revenue to reach USD$14.9bn (£11.4bn) in 2023; Nintendo mobile games generate USD$1bn (£768m); and Disney to close Fogbank Entertainment.

XR revenue to reach USD$14.9bn (£11.4bn) in 2023

The global XR market is projected to reach USD$14.9bn (£11.4bn) by 2023, according to estimates released by Nielsen's SuperData division. Forty-five percent of this figure, USD$6.7bn (£5.1bn), can be attributed to sales of AR/MR hardware and consumer software, which would largely comprise of video game titles. The projections come after the strong performance of VR headsets in the final quarter of 2019, with the top-five devices (PlayStation VR; Oculus Quest; Valve Index; Oculus Go; and Oculus Rift S) selling a combined 913,000 units.

As previously covered in TheGamingEconomy, demand for the Valve Index headset has accelerated sharply following the announcement of its Half-Life: Alyx title, due to be released in March, with the device selling out globally. SuperData analysts estimate that sales for Valve Index more than doubled from Q3-Q4 last year, with this figure expected to rise further once the aforementioned inventory issues are resolved.

Nintendo mobile games generate USD$1.08bn (£829m)

Nintendo's portfolio of six mobile titles has generated lifetime revenue of USD$1.08bn (£829m) globally from an estimated 452 million downloads as of 26th January 2019, according to figures released by Sensor Tower. Despite accounting for only 4% of total downloads, the majority (USD$656m/£504m) of consumer spend can be attributed to strategy RPG Fire Emblem Heroes, giving the title an average revenue-per-download (ARPD) figure of USD$41 (£31). Through 2019, Nintendo's array of mobile titles earned over USD$350m (£269m).

Despite amassing 90.1m downloads in its first week alone, Mario Kart Tour has thus far proved less lucrative for Nintendo, amassing an estimated USD$76m (£58m) since launch. Unsurprisingly, the lion's share (54%) of revenue from Nintendo's mobile titles was generated in its home market of Japan, with consumer spend here reaching USD$581m (£446m). This is also reflected at the title level, although the US is the leading market in terms of player spend for Mario Kart Tour and Super Mario Run.

Garena acquires Phoenix Labs

Mobile developer-publisher Garena, itself part of the Sea Limited digital services group, has announced the acquisition of Vancouver-based PC and console studio Phoenix Labs for an undisclosed sum. The acquisition represents an exit for the Canadian developer, having been backed to the tune of approximately USD$590,500 (£453,400) by various venture capital firms including Modern Times Group (MTG), Everblue Management, Ridge Ventures, and Sapphire Ventures.

In a statement announcing the acquisition, Forrest Li, founder and group CEO of Sea, said, “We couldn’t be happier to welcome Phoenix Labs to the Garena family. Over the last few years, we have watched Phoenix Labs mature into one of the best development teams in the business and launch a hugely exciting title in Dauntless. We also know that they share our mission of making great games, creating the best teams, and putting players first. Our skills sets are highly complementary, and we see many exciting opportunities ahead that our teams can explore together.”

Disney to close Fogbank Entertainment

Disney is set to close its Fogbank Entertainment studio, which was not included in last week's sale of FoxNext Games to Scopely, as reported by VentureBeat. While neither Disney nor Fogbank spokespeople have commented on the closure, it has been confirmed that the studio's interactive fiction title Storyscape will be shuttered as of Feburary 3rd 2020.

The closure will result in the loss of approximately 60 staff from Fogbank's San Francisco office, with sources indicating redundancy packages will be offered to all those affected, with no relocations offered.