MediumMonopolies in Games Industry. I am a game designer, and all I want is… | by Stanislav Stankovic | Sep, 2026 | Medium
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Monopolies in Games Industry

10 min readSep 28, 2026

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I am a game designer, and all I want is to make games. I also want people to play them. That is the whole point, and it sounds almost too obvious to write down. However, there is one crucial step hiding between "we made a game" and "people are playing it" and its a landmine. The success of every single game depends on it and us game makers have very little control over it.

This notorious step is publishing, and the reason why we have so little control over it is because we are working inside someone else's storefront, under someone else's revenue distribution rules, following someone else's review process.

The global games industry consists of several partially overlapping domains. PC, console and mobile are, by far, the three biggests. Some games cross all three. Most studios, especially smaller ones, pick one, maybe two, and live there.

Each of these domains is dominated by a relatively small number of companies that get to set the rules. In effect they decide which games launch, when, and how visible they get once they do. That is simply the operating environment inside of which we need to operate.

People throw around the word monopoly a lot when they talk about Steam, or Apple, or Tencent. Other people roll their eyes and tell you it's a free market, that anyone can publish anywhere, that competition sorts it all out. I am a game designer, not an economist, and I used to assume both of these were just opinions you pick based on temperament. They are not. They actually have clear definitions with solid data, and a research framework behind them.

Enter CR4

No, not Cristiano Ronaldo. That is CR7. The letters CR stand for *concentration ratio*, and the number behind them represents the number of companies that define it. It is one of the oldest, simplest tools in industrial organization economics.

You calculate it by taking the market shares of the four largest companies in an industry and add them together. That's it. If the top four smartphone makers hold 30, 25, 15 and 10 percent, your CR4 is 80 percent.

The method traces back to American economist Joe Bain, who used concentration data alongside profit rates across dozens of American manufacturing industries in the 1930s and 40s, published as "Relation of Profit Rate to Industry Concentration: American Manufacturing, 1936–1940" in the Quarterly Journal of Economics in 1951\.

He found that firms in concentrated industries earned persistently higher profits than firms in fragmented ones. Industries where a handful of firms controlled most of the output behaved differently, and made more money doing it, than industries where output was spread across many competitors.

That single observation became the seed of what economists now call the structure-conduct-performance paradigm, and it gave American antitrust regulators a number they could actually use. The Department of Justice started leaning on CR4 as a primary concentration metric in the 1960s, back when the US government still cared about the health of their free market economy.

Once you have your CR4 number, there's a rough, widely used classification for what kind of market you're looking at:

CR4 Market structure:

  • Under 40% — Fragmented / competitive
  • 40–70% — Loose oligopoly
  • 70–90% — Tight oligopoly
  • 90–100% — Near monopoly to outright monopoly

Simple table, simple math, and yet almost nobody in games discourse seems to be aware of it before declaring a platform a monopoly or dismissing the idea entirely. So, for your benefit, I tried to aggregate the data. Here's what the numbers say, segment by segment.

I’ll also mention another measure, CR2. It is CR4’s older meaner brother. The number 2 indicates two companies. SImply put CR2 measures how much do two largest companies dominate their market. In other words it says how close each market is to a duopoly. In the same way CR1 indicates the level of monopolization of a market by a single company.

Gaming Industry and CR4

A few honest caveats first. Public financial disclosures are patchy, several of these companies bundle gaming revenue with unrelated business lines, and analyst estimates disagree with each other by several points depending on methodology. The right response to that is holding the numbers loosely and citing where each one comes from. I also split this analysis in two parts for each of three main domains into two slices, analysis of storefronts and publishers.

Mobile storefronts

I am starting with mobile platform as I spent most of my career working on mobile games. This domain is obviously dominated by two mayor players. Outside of China, Apple and Google control more than 95 percent of the app store market between the App Store and Google Play. There effectively is no third or fourth player at global scale, which means CR4 here rounds to the same number as CR2, and CR2 sits above 95. That's about as close to a pure duopoly as a global digital market gets.

Mobile publishers

This is the one that surprised me most. Tencent led mobile publishers by revenue in 2025 at $8.75 billion, followed by Scopely at $2.96 billion and Century Games at $2.73 billion, against a global mobile games market that reached $108 billion in 2025\. Add a fourth publisher in the same range and you land a CR4 somewhere around 13 to 15 percent. Mobile storefronts are a near-duopoly. Mobile publishing, the actual business of making and releasing the games, is closer to fragmented than to oligopoly. Two very different market structures sitting on top of each other in the same industry segment. This fact is probably what muddies the discussion the most. The market is essentially a duopoly.

PC storefronts

Steam controls roughly 75% of the PC gaming digital distribution market, with Epic Games Store holding 8 to 10%, Microsoft Store and Game Pass combined at 6 to 8%, and GOG at 2 to 3%. Add those four together and you get a CR4 somewhere in the low-to-mid 90s. Tight oligopoly bordering on near monopoly, and one company, Valve, accounts for most of that share by itself.

PC publishers

Here the data gets thin enough that I won't hand you a fabricated number. What the evidence does show is a long tail: Steam alone added over 18,000 new titles in a single year, and most of that catalog comes from small and mid-size studios rather than a handful of majors. Publisher concentration on PC looks structurally closer to mobile than to the storefront layer above it, fragmented at the top even while distribution sits in one company's hands. This situation parallels the one on mobile, tight concentration of storefronts and much freer publishing layer.

Console platforms

This is the cleanest case in the whole industry, because there are only three companies to measure. Sony holds an estimated 45% of the console market, Microsoft's Xbox 27%, and Nintendo Switch approximately 24%. Three firms, effectively 100% of the market between them. CR3 and CR4 are identical here because there is no fourth firm to add. This is what a strict, closed oligopoly looks like when you can actually see all its members in one glance, and it exists because the barrier to entry is a physical console plus a certification process that only three companies on Earth currently clear.

Console publishers

Sony's own platform revenue dwarfs any individual third-party publisher on its own hardware, and the same dynamic repeats on Xbox and Switch, where the platform holder is also the biggest first-party publisher. Layer Microsoft's acquisition of Activision Blizzard on top of that and the third-party console publishing landscape, EA, Take-Two, Ubisoft, and the rest, has to compete for shelf space against companies that also own the shelf. I won't put a single clean percentage on this row, the segment reporting is too inconsistent across companies to defend one, but directionally this sits closer to tight oligopoly than to anything fragmented.

Industry overall

If we zoom out now and take a look at the industry as a whole, we can see that Sony, Tencent and Microsoft together account for roughly 44% of the entire global games market, which is already a CR3 that would raise eyebrows in most manufacturing sectors Bain ever studied. Extend that to the top ten publicly traded gaming companies and estimates put the combined share around 60 percent of global revenue. For an industry people still describe as a wide-open creative frontier, the money says loose-to-tight oligopoly at the top, sitting on top of a genuinely long tail of small studios who see almost none of that revenue.

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Put it all together and the shape of the industry is not one market, it is several markets stacked on top of each other with wildly different concentration levels. Distribution is a near-monopoly on mobile and a tight oligopoly on PC. Hardware is a closed three-firm club on console. Publishing itself, the part we actually do for a living, is the most fragmented layer in the whole stack, on mobile and PC at least. We are the competitive part of an otherwise concentrated industry, standing on gatekeeper infrastructure that is anything but.

Nobody has to pick up the phone

People arguing about monopoly or collusion in games discourse tend to assume both words require a room full of executives agreeing on numbers. Because that room obviously doesn't exist, they conclude the market must be healthy. Economics has disagreed with that assumption for over sixty years.

Coordination among firms that occurs without an explicit agreement has a name in economics: tacit collusion. Standard theory predicts that cartels and tacit collusion are more likely in oligopolistic markets, where a relatively small number of producers recognize direct, mutual interdependence in their pricing and output choices. George Stigler formalized this in his 1964 paper "A Theory of Oligopoly," arguing that in a market with few enough players, each firm can simply watch what the others do and adjust, no phone call required, because the number of players is small enough that everyone's moves are visible to everyone else. American courts got there even earlier: in Interstate Circuit v. United States (1939), the Supreme Court found that parallel conduct plus knowledge that competitors were likely to follow suit was enough to establish an unlawful agreement, without a shred of direct evidence that anyone talked to anyone.

Apply that lens to a three-firm console market or a two-firm app store duopoly and the absence of a smoking gun stops meaning very much. When Apple sets its commission rate and Google's ends up in the same neighborhood, when one storefront's revenue split becomes the reference point every developer negotiates against, oligopoly theory treats that as the predictable equilibrium of a small, visible market, where ignoring what the others charge carries real cost and undercutting them into a price war carries more.

A confession

I have spent fourteen years on the inside of this stack, most of it on the mobile side, working on SimCity BuildIt, one of Apple and Google's storefront-dependent titles like every other mobile game in existence. I take a cut from every player's purchase, and Apple and Google take a cut of mine. Every design meeting I can remember spent its energy on drop rates, onboarding funnels, and retention curves. The 30 percent platform fee sitting underneath all of that math simply never came up as a design problem, and I suspect that's true for most of the people reading this too. We are all fluent in the mechanics of our own games and mostly illiterate in the market structure that decides whether anyone gets to play them.

Key Takeaways

  • CR4 sums the market share of the four largest firms in an industry, a tool that goes back to Joe Bain's 1951 work correlating industry concentration with profit rates, and it became a standard antitrust metric for the US Department of Justice in the 1960s.
  • Mobile storefronts are effectively a two-firm market. PC storefronts are a tight oligopoly dominated by one company. Console platforms stay a closed three-firm club because hardware certification is the barrier that keeps it that way.
  • Publishing itself, on mobile and PC, is far more fragmented than the distribution layer sitting above it. We work in the competitive part of a concentrated industry.
  • Tacit collusion doesn't require a meeting. In a market with few enough visible players, parallel pricing behavior is a predictable equilibrium, not necessarily evidence of a conspiracy, a point going back to Stigler's 1964 oligopoly theory and to US antitrust case law from 1939 onward.
  • The point of the exercise is measurement, not moral verdict. Concentrated markets show up in plenty of sectors outside games, and measuring beats arguing from priors.

Links and references

Game Design
Video Games
Gaming Industry
Antitrust
Economics

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Stanislav Stankovic
Stanislav Stankovic

Written by Stanislav Stankovic⁠

1K followers
46 following

Senior Game Design Director at EA. Ex-Supercell, Ex-PixelUnited, Ex-Rovio.

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