Video gaming growth not about to stop, except for US PC market, says report

Saturday 23rd June 2007, 09:09:00 PM, written by Farid

The Hollywood Reporter published an article on future video gaming industry growth based on data collected in the annual Global Entertainment and Media Outlook from the market advisory company PricewaterhouseCoopers. At first sight, as the press release shows, everything is looking fine on the video gaming side of things, publishers and manufacturers can lay their doubts about industry's overall growth to rest.

Indeed, the report predicts the video game industry to be one of the above-average growth parts of global entertainment industries through 2011. The reasons for that growth are, for PwC, the arrival of new consoles focused on online gaming, the debut of in-game avertising , online gaming and distribution, and the ever-growing mobile gaming market

PwC sees a cumulative annual growth rate of 9.1% for the next five year, raising the total market worth from $32 billion in 2006 to a projected $48.9 billion in 2011. The breakdown per region shows that the biggest engines for growth in this sector will be the Asia Pacific and Europe, Middle East and Africa (EMEA) regions, with an average cumulative annual growth rate around 10 points. For the 2007-2011 period the US market is expected to see it annual growth to plunder from 15.5% this year to 3.3% in 2011.

Also noteworthy are the predictions that in the US market, that console sales will drive the market from 2007 and 2008 and will then slow down as they approach “maturity.” Online video gaming business is also expected to increase from $1.1 billion in 2006 to $2.7 billion in 2011, while mobile gaming will double from $499 million to $1 billion.

On the other hand, not all of the predictions for the US market sound as positive as the last two. The analyst outlook reports that a decline of the US PC market is expected, going from $969 million in 2006 to $840 million in 2011. It has to be said that the paper does not clarify whether this number includes online gaming revenues or if it singles-out retail boxed sales only. Another point that may not please many readers is that revenues from in-game advertising are expected to grow exponentially, reaching close to a billion dollars in 2011 from less than $80 million in 2006.

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Tagging

graphics ± video, gaming:growth


Latest Thread Comments (20 total)
Posted by Arun on Sunday, 24-Jun-07 12:09:50 UTC
Quoting Ostepop
And WoW is not the most popular game, it has sold what? 6-8 million?
It certainly isn't the most popular game ever in terms of game sales (correct me if I'm wrong, but for the PC, isn't that The Sims? Or is there something that beats that if you don't consider the whole series?), but it probably *is* the most popular game ever in terms of hours spent. On that subject... http://216.239.59.104/search?q=cache:nG6gkjRwcNsJ:www.dailytech.com/article.aspx%3Fnewsid%3D5709%26commentid%3D97317%26threshhold%3D1%26red%3D254+%22world+of+warcraft%22+site:www.dailytech.com/&hl=en&ct=clnk&cd=5&client=opera :)

Posted by ninzel on Sunday, 24-Jun-07 13:03:17 UTC
You guys are still talking about WOW? You can't build an entire platform or industry on one game.

Posted by Ostepop on Sunday, 24-Jun-07 13:05:04 UTC
Quoting _phil_
( factual: ) Neither MS nor Sony want WOW on their consoles.Because people wouldn't buy anyother game.
I doubt that.

If MS or Sony would get a small percentage of the monthly fees it would make up for it. Untapped market for consoles more or less.

Posted by Skrying on Sunday, 24-Jun-07 18:42:56 UTC
Quoting Ostepop
What the hell ???You said:And WoW is not the most popular game, it has sold what? 6-8 million? And i just showed games that has sold more. I didn't run around talking about profits, i just commented on your statement which related directly to sales. I'm perfectly aware that WoW is a money making machine.
Popularity is not limited to sales alone, you are the one who made the limitation. Culture impact, consistent player base, etc. WoW has around 9 million player, grows constantly (unlike the other games, WoW's player base continues), and its first expansion sold 3.5 million copies in the first month. Very few other games have had the presence of WoW, its own South Park episode, a lot of media coverage of addicted players, a movie deal in the works with a supposed budget of near $100 million. NONE of the games in recent history have caused that. Its funny, if you go into the console forum you hear a lot about a "system seller" game... WoW is a great example of such.The popularity of MMOs on PCs can not be denied, in nearly all the PC market. The new Lord of the Rings online MMO is set to become the second most popular game behind WoW and is growing the market and not stealing from it. Also, believe it or not the PC is getting tons of console ports these days. Many games are finding their way to PC because there is a (I believe) growing market of dedicated gamers. When the vast majority of your budget is in the art assets it just makes since to spread out onto as much platforms as possible. I think the PC is benefiting from 1.) Console game developing hitting extreme highs. 2.) Explosion in markets that show PC gamers are willing to pay. 3.) Extremely aggressive pricing for computer equipment.To be honest I don't care what a "report" says. I think PC gaming will continue to expand in a large number of markets and areas, including the US. The only issues I seen hurting it are the lack of value that consoles gamers are experienced to heading to PC (this is why Live for PC won't work, it costs money for WORSE service then we get already) and piracy, but if your game is good it has shown that people will buy it.

Posted by Shifty Geezer on Sunday, 24-Jun-07 19:30:32 UTC
Quoting Skrying
Its funny, if you go into the console forum you hear a lot about a "system seller" game... WoW is a great example of such.
Not sure how that's justified. Do people buy a PC to play WoW? Dunno. And would they buy a console to play WoW? If one of the companies landed WoW2 as an exclusive, could they count on some 9 million new owners? I'm sure these MMO people would love targetted MMOs that look fantastic, rather than rather simple looking MMO's that try to cater for older hardware.

Posted by Skrying on Sunday, 24-Jun-07 19:48:24 UTC
Quoting Shifty Geezer
Not sure how that's justified. Do people buy a PC to play WoW? Dunno. And would they buy a console to play WoW? If one of the companies landed WoW2 as an exclusive, could they count on some 9 million new owners? I'm sure these MMO people would love targetted MMOs that look fantastic, rather than rather simple looking MMO's that try to cater for older hardware.
First, WoW is far from simple. It might not have the check box features, but it looks far better than many of these "omgz its teh features" games out there. Just another fine example of art *>* "features". You also have to realize that there are a few MMOs that already look better (well, more than a few). The new LOTR and Vanguard looks generally better in a sense (again, artwork is not even close)... MMO is hardly a market of gamers effected by looks however.

Also, where did I say it would be a 1:1 move? Certainly not, but a number of new customers probably would pick up a console in order to play it. It would be a huge mark up for the company, certainly, like any other major franchise generally is. I'd say that a number of people have upgraded their computers to play WoW. Major cities and large raids are very taxing even on relatively high end computers (like my own). People want a smooth experience and lag isn't the greatest excuse when you wiped a 25-man raid for the fourth time.

Posted by zed on Sunday, 24-Jun-07 20:12:22 UTC
Quoting NavNucST3
odd? One country compared to two regions, with one of the regions having some 2billion people. Also, I thought the report said largest E&M market, but the slowest growth rate..
odd as in i always thought US was the largest videogame market in terms of sales.yes it does say in that report for Entertainment and Media the US is the largest market but looking only at the videogames sector its the smallest, publishers will take notehttp://www.gamasutra.com/php-bin/news_index.php?story=14430

Posted by Johnny Awesome on Thursday, 28-Jun-07 17:13:49 UTC
Quoting Skrying
The popularity of MMOs on PCs can not be denied, in nearly all the PC market. The new Lord of the Rings online MMO is set to become the second most popular game behind WoW and is growing the market and not stealing from it. Also, believe it or not the PC is getting tons of console ports these days. Many games are finding their way to PC because there is a (I believe) growing market of dedicated gamers. When the vast majority of your budget is in the art assets it just makes since to spread out onto as much platforms as possible. I think the PC is benefiting from 1.) Console game developing hitting extreme highs. 2.) Explosion in markets that show PC gamers are willing to pay. 3.) Extremely aggressive pricing for computer equipment.

To be honest I don't care what a "report" says. I think PC gaming will continue to expand in a large number of markets and areas, including the US. The only issues I seen hurting it are the lack of value that consoles gamers are experienced to heading to PC (this is why Live for PC won't work, it costs money for WORSE service then we get already) and piracy, but if your game is good it has shown that people will buy it.
Do you have any reliable sales/userbase info for Lord of the Rings Online? I've recently become involved in playing it quite a bit and was wondering how it was doing. I still like WoW, but took a hiatus to play something new for awhile.

Posted by dobwal on Thursday, 28-Jun-07 20:10:23 UTC
Its pretty obvious to see why some are predicting a decline in the PC Market.

No matter how well WOW is doing it can't prop up the PC market by itself and consoles are currently eating up genres once dominated by the PC market.

We have a FPS titles like Crysis on horizon, but it wasn't that long ago that FarCry hit the market and excitement was at an all time high for Doom and Half Life 2 with Stalker looking like a serious competitor. Now we have titles that years ago wouldn't have seen daylight on a console or were so technically gimped that they were seen as just console fodder, slated for consoles that visually rival their PC counterparts. I wonder if the leaps in PC visual quality that we seen in the past will be possible in the future now that console ports are becoming a major influence on devs and pubs.

While consoles haven't had much success in gaining a real foothold in the MMORPG market, the current MMORPG situation pales to not so distance past when Everquest was the MMORPG of the day and MMORPGs like WOW, Star Wars Galaxies, EQII, City of Heroes, Matrix Online, Sims Online and Guild Wars were on the horizon. WOW, City of Heroes and Guild Wars have done relatively well but currently I doubt there exist a bevy of PC MMORPGs that elicit as much exitement as those previously mentioned titles.

While newly released Supreme Commander and news of a new StarCraft puts PC RTSes back on the map, a well made and critically acclaimed Halo Wars would garner the type of sales that would influence the RTS landscape the way that Halo influenced the FPS landscape.

Posted by Skrying on Thursday, 28-Jun-07 23:10:23 UTC
Quoting Johnny Awesome
Do you have any reliable sales/userbase info for Lord of the Rings Online? I've recently become involved in playing it quite a bit and was wondering how it was doing. I still like WoW, but took a hiatus to play something new for awhile.
No, just a assumption based on the fact that its been really well recieved, had a solid launch, and a great existing IP. Hell, I was tempted to switch from WoW to LOTRO. BTW, just for clarification I don't consider Second Life a MMORPG in the same sense as WoW, LOTRO, EQ2, EQ, etc, etc.


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