Pixel P&L: The Bizarre Reason Your PS5 Could Cost More Than Your iPhone

Hey there!

Welcome to another edition of Pixel P&L. This issue takes 5 minutes to read.

If you only have one, here are the five most important things:

• Gaming consoles face new tariff challenges while PCs and phones receive exemptions in the latest Trump administration trade policy.
  

• Karnataka is developing legislation to regulate online gaming, distinguishing between skill-based games and gambling - Full details below.
  

• Eloelo, the Bengaluru-based live streaming platform, secured $13.5 million in Series B funding led by Play Ventures with plans to reach $60M in annual revenue by year-end.
  

• Gaming industry M&A activity surged to $6.6 billion in Q1 2025, reaching a two-year high according to investment bank Aream's latest report.
  

• Steam's libertarian content stance backfired with the controversial "No Mercy" game — read the full story below.

📊 Gaming Stocks Today

Game Console Makers Face Tariff Hit as PCs, Phones Gain Exemption

The U.S. government has exempted personal computers and mobile phones from its latest round of tariffs on imported goods, while notably leaving video game consoles exposed to the new levies.

The decision creates a challenging landscape for Sony, Microsoft, and Nintendo, which now face additional costs to sell their PlayStation, Xbox, and Switch consoles in the American market. The exemption list does cover components used in manufacturing these gaming devices, raising questions about whether the omission of finished consoles was intentional or merely an oversight.

Nintendo received a partial reprieve as "solid-state non-volatile storage devices," which include Switch game cartridges, gained exemption status.

The broader tariff structure imposes a 10% levy on most imported goods, with China facing a substantially steeper 125% rate. While console manufacturers are currently expected to absorb these costs rather than raising consumer prices, industry analysts warn this could change if previously announced harsher measures are implemented after the current 90-day pause expires.

Karnataka Moves to Regulate Online Gaming Industry

The Karnataka government has initiated steps toward regulating online gaming platforms, aiming to distinguish between skill-based games, games of chance, and gambling operations.

State IT Minister Priyank Kharge announced on social media platform X that he held a high-level meeting with industry stakeholders to discuss a regulatory framework. The meeting included Home Minister G Parameshwara, government officials, and industry representatives.

"The intent is to curb online gambling and games of chance while supporting innovation in skill-based gaming," Kharge stated.

Parameshwara told reporters that authorities will establish a panel to submit a draft bill within a month, modeling the legislation after Chhattisgarh's regulatory approach.

According to Kharge, the "legitimate online skill-based gaming industry" contributes INR 1,350 crore ($161 million) in annual taxes to state coffers, while unregulated offshore gambling presents risks including financial fraud and cybercrimes.

This move follows Tamil Nadu's recent gaming regulations and coincides with both Maharashtra's reported exploration of a licensing system and the central government's efforts to bring online gaming under anti-money laundering laws.

⚡Quick Bytes

Indian Live Streaming Platform Eloelo Secures $13.5 Million in Series B Funding

Bengaluru-based Eloelo has raised $13.5 million in Series B funding to expand its creator-focused live social entertainment platform. Singapore-based Play Ventures led the round, with participation from Kalaari Capital, MIXI Investments and others. This brings Eloelo's total funding to over $50 million since its 2020 founding by former Flipkart executives Saurabh Pandey and Akshay Dubey. The company plans to deploy funds toward generative AI development and expansion into Indian diaspora markets, with aims to reach $60 million in annual revenue by year-end.

Independent Investment Bank Aream: M&A Activity Surges to Two-Year High

Gaming industry mergers and acquisitions surged to $6.6 billion in the first quarter of 2025, reaching a two-year high, according to investment bank Aream's latest quarterly report (PDF Link). The firm attributes this uptick to strategic acquirers actively restructuring their portfolios amid evolving market conditions and consolidation pressures.

How Steam's Libertarian Content Stance Backfired

Steam's libertarian stance landed it in hot water after No Mercy (a 3D visual novel with non-consensual, sexually explicit content) sparked outrage. Unlike console stores, Steam doesn't require ESRB/PEGI ratings, instead using its own "Adults Only" tag + credit card verification. Following the outrage, Valve ended up pulling it from UK/Australia/Canada storefronts without comment, after which developer Zerat Games ultimately announced the game's total removal from Steam due to the backlash.

⚔️Side Quest

📺 Watch: "The Remarkable Life of Ibelin" masterfully blends stunning cinematography with breathtaking World of Warcraft recreations to reveal how a young man confined by muscular disease built a vibrant digital existence, delivering a visually spectacular and profoundly moving testament to human connection that will leave you in tears.

🎮 Play:  "Haste" offers a fresh take on speed-running with procedurally generated worlds where you'll collect items and unlock abilities while racing against the collapse of the universe. It is an experience that puts recent Sonic games to shame.

📚 Read: Deconstructor of Fun's analysis reveals crucial insights into Gen Z's uniquely social gaming habits, essential knowledge for anyone developing games or seeking to understand how friendship drives this generation's playing patterns.

💡Did You Know

Tomohiro Nishikado, the creator of Space Invaders (the iconic 1978 arcade game where players defend against waves of descending aliens), discovered that the processor lag reduced greatly with fewer invaders on the screen. Rather than compensate for this technical limitation, he left it as is, potentially inventing incremental difficulty in video games!

📜 Quote of the Day

Was this forwarded to you? Sign up for free here. 

We read every email! Share your feedback by hitting reply.