Online Game Sales and Subscription Revenue Will Triple to $1.1 Billion by 2008, Says Yankee Group
New devices, shift from CD-ROM, and falling console prices will create revenue opportunities for on-line games
BOSTON--(BUSINESS WIRE)--July 12, 2004-- Over the course of just a few years, online gaming has grown from a nascent industry to $353 million in direct sales and subscriptions revenue and $450 to $550 million in advertising.
Although software and hardware revenue fluctuate, online revenue grows steadily, according to the Yankee Group report, Online Video Gaming Will Plug Publishers, Home Net Vendors and BSPs into New Revenue. Revenue from the sale of video game consoles is significantly affected by the console life cycle. Originally priced at $299 when they debuted, video game console MSRPs will fall to $79 to $49 within the next several years.
"Console growth is negatively affecting CD-ROM based PC game sales," says Michael Goodman, Media & Entertainment Strategies senior analyst. "PC gamers are migrating to consoles, causing revenues for PC games on CD-ROMs to decline and console revenue to grow. Online gaming represents a shift in revenue, away from boxed CD-ROM games sold at retail to online sales."
With the growth of online gaming, a number of conclusions can be reached about this evolving market:
New devices are creating revenue opportunities for Web-based games.
Advergaming represents a significant opportunity for advertisers, publishers, and developers.
Online games will stabilize and supplement revenue from PC and console games.
Online console gaming represents an opportunity to enhance the relationship between broadband service providers and console manufacturers.
PRESS CONTACT
For interviews contact Michael Goodman, mgoodman@yankeegroup.com
THE YANKEE GROUP (www.yankeegroup.com)
The Yankee Group is the global leader in communications & networking research and consulting. The company helps businesses understand the opportunities, risks and competitive pressures of developing, deploying and consuming products and services that drive communication or information exchange. Now in its fourth decade, the Yankee Group is based in Boston with offices throughout North America and Europe.
Contacts
The Yankee Group
Kimberly Vranas, 617-880-0214
kvranas@yankeegroup.com
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