Thanks to the growth in usage of video game consoles online and the continued boom in broadband take-up, the online game market is expected to grow from $3.4 billion in 2005 to $13 billion in 2011.
A new study from DFC Intelligence, entitled
The Online Game Market, places massively Multiplayer Online Games (MMOG’s) at the forefront of this growth, with high revenues to be reaped from subscriptions in contrast to sport and action games, where the majority of revenue comes from retail sales.
Helping the expected growth will be the new consoles on the market which allow users to play online, as is already possible with the Microsoft XBOX 360 console. Said DFC: “As console systems go online in increasing numbers they are expected to be a key driver of growth. Unlike past video game systems, the new console systems from Microsoft, Nintendo and Sony all will have a major focus on online connectivity right from the start. The Xbox Live online game service is a central part of the Microsoft Xbox 360, the Sony PlayStation 3 is expected to have an increased focus on online games and the Nintendo Wii will feature the online enabled Virtual Console concept that will allow for some significant online digital distribution.”
The report also forecasts that digital distribution will become a very big part in online connectivity, particularly from a retail perspective with more people paying for games, but not necessarily playing them, online. Alexis Madrigal, a DFC analyst, said: “Digital distribution and virtual item sales have started to do very well in certain Asian markets and these distribution models are expected to start having increased success on an international basis.”
However, the study does point out that the fragmentation of the gaming market means that although a game may do well in one region, this does not automatically mean it will do as well in another. DFC said: “The top online games have tended to do very well in one market like Korea, China, or the US, but have generally struggled in trying to expand to other markets. Furthermore, traditional video game publishers have not done well in the online game business and this has allowed for the rise of several online-only game companies (see In-Game Ads Look Appetising For Advertisers)that are making the marketplace more competitive for established players.”
The research shows that large markets like South Korea, China (see Chinese Online Gamers To Hit 61 Million By 2010), Japan and the US are all now able to support individual games that do over $100 million a year in just one country.
Related Links
