As music sales and streaming revenue reaches a high of 2.4bn – the highest since 2001, not accounting for significant inflation – the UK video game market, which has grown almost continually for decades, has shrunk by 4.4%. The most significant decline was in boxed video game sales, down 35%. Data from Digital Entertainment and Retail Association (ERA) puts the total worth of the UK video game market in 2024 at 4.6bn, double the music market and behind TV and movies at 5bn. The numbers show a shift in players' purchasing habits that has been ongoing for years, from physical games to digital downloads and in-game purchases in popular, established games such as Fortnite and Roblox. Boxed games now account for 27.7% of new game sales in the UK, according to ERA data.

One of the criticisms of the new consoles is a lack of games tailored to the latest technology. Developers will hope that this is the reason behind the slowdown in software sales, rather than a more fundamental change in consumer behaviour.

The UK video games market hit a new record of £7.16bn last year as the pandemic continued to fuel an unprecedented boom in home entertainment, with gamers rushing to stock up on new consoles and virtual reality kit even as overall sales of games fell. Lockdown conditions have made gaming one of the biggest pandemic winners with the value of the UK market now a third higher than in 2019 before the coronavirus crisis hit and worth more than the music and video streaming markets combined. The amount spent by gaming fans – on everything from new consoles, software and mobile games to themed events, toys and magazines – rose 1.9% year on year beating expectations that the market would slide following the gaming gold rush at the height of the pandemic in 2020. The overall market rose despite a 6.3% fall in the sale of video game software to £4.28bn, with the most popular titles including Electronic Arts' Fifa 22, Activision Blizzard's Call of Duty: Vanguard and Take-Two Interactive's Grand Theft Auto V. "The important story here is how much of the lockdown related boost seen in 2020 has been successfully retained during 2021's'year of correction'," said Steven Bailey, a senior analyst at Omdia. The attractiveness of the gaming market – which is worth almost £1.8bn annually more than 2019 – has sparked a wave of consolidation with US and Chinese gaming companies splashing out more than £2bn on British video games makers over the last two years.