New PlayStation and Xbox Arrive During a Pandemic Gold Rush

EMERYVILLE, Calif. — Huddled under blankets to brace against the cold, J.B. August and his

EMERYVILLE, Calif. — Huddled under blankets to brace against the cold, J.B. August and his buddies couldn’t help grinning as the doors of the boarded-up GameStop store finally opened.

The six men, strangers turned friends after camping outside on the sidewalk all night, let out whoops of excitement on Tuesday morning as they finally got inside to buy the boxy yet sleek new Xboxes.

“I’m just treating myself — it’s therapy,” said Mr. August, 35, before triumphantly carrying the device out of the store after 18 hours of waiting. “I never really have time to do anything for myself, so let me just go ahead and make an investment for myself and my peace of mind.”

The gaming craze on display in the Bay Area was echoed around the country this week as video gamers flocked to stores and crashed preorder websites in their rush to buy new video game consoles: Microsoft’s Xbox Series X and Sony’s PlayStation 5.

The release of the devices heralded the beginning of a new generation for video gamers, but in many ways was just an exclamation point on what has already been a huge year in the gaming industry.

With much of the world confined to homes throughout the coronavirus pandemic, many have sought out entertainment for the first time through games on various devices. Hard-core fans are logging more hours on their screens, too.

Gamers worldwide are expected to spend a record $175 billion on software alone in 2020, according to Newzoo, a gaming analytics firm, up from $146 billion a year ago. In the United States, gamers spent $33.7 billion across hardware, accessories and content through September, according to the NPD Group. And Piers Harding-Rolls, a research director at Ampere Analysis, an analytics firm in London, projected that Sony would sell 8.5 million PS5s and Microsoft would sell 6.5 million of the Xbox Series X and the smaller, cheaper Series S through March.

But some Wall Street investors wonder: Are the pandemic-fueled growth and soaring profits of the video game industry — which was already bigger, by sales, than the film and music industries — sustainable after the virus subsides and doors to the outside are flung open again?

When news broke Monday that a Pfizer vaccine candidate had been found to be encouragingly effective in fighting the coronavirus, video game stocks like Activision Blizzard, Electronic Arts and Take-Two Interactive fell along with quarantine mainstays like Zoom and Peloton.

“It’s a concern on the part of a lot of investors that once stay-at-home rules are eased, that these publishers will see less engagement with their games,” said Yung Kim, an entertainment technology analyst for Piper Sandler & Company. “It’s a matter of how people decide to spend their time.”

Interviews with two dozen gamers, livestreamers turned influencers, analysts and company executives, however, found that most in the industry are convinced this is not just a pandemic-related boom.

People who believe gaming newcomers will be loath to drop their devices when concert venues, movie theaters and sports arenas reopen point to what they see as an inherent “stickiness” to their products. Gamers build communities and grow accustomed to socializing with their friends and family over rounds of Fortnite or Among Us, the argument goes, and those bonds only strengthen over time.

“If you look at what teens are doing across America — actually across the globe right now — this is kind of their social currency,” said Jaci Hays, the chief operating officer of FaZe Clan, an e-sports conglomerate whose popular gamers can make six or seven figures a year. “We don’t see it slowing down.”

Nick Kolcheff, a FaZe Clan member who earns a living streaming Fortnite and Call of Duty to the 4.5 million people following his Nickmercs Twitch channel, said the gaming boom had caused an entire generation of children to idolize famous streamers just as they would professional athletes.

“There’s a real commitment, there’s a real addiction,” he said. “After those teeth sink in, it’s kind of hard to bob and weave and get out.”

“If you’re not buying, then aren’t you inevitably also opening the door for these big tech companies to kind of sneak in?” he asked.

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