Report: Digital Content Expected to Drive Growth for Video Game Systems

1
26

NEW YORK and SAN DIEGO, October 30, 2013 (ADOTAS) – A new report from DFC Intelligence and Live Gamer examines the future of video games in the living room.  According to the report, over the next few years the monetization of video games is expected to radically change as consumers connect online devices to their television sets.  Leading this charge are new game systems to be launched next month from Sony and Microsoft, the PlayStation 4 and Xbox One.

The biggest change will be new ways in which consumers pay for games.

“Game console systems have been able to go online for many years, but online play has been mostly free.  This is expected to change significantly with this new generation of devices,” said David Cole (pictured), CEO of DFC Intelligence.

Monetization models popular on mobile devices and PC games are expected to start coming to console systems over the next few years.  According to the report, from 2014 to 2017, 36% of game revenue for the new game systems is expected to come from digital delivery with 61% of revenue from sales of traditional packaged discs.  This does not include revenue from additional digital content such as video.

In the mobile and PC game market developers have become very creative in the way they get consumers to pay for content.  Options beyond full digital download of products include freemium titles, add-on content, pay-as-you-go models and many forms of bundled subscriptions and other packages.

“This year’s report confirms that the addition of games-as-a-service to existing console business models will make titles more profitable than ever,” said Andrew Schneider, co-founder and president of Live Gamer, Inc. “Developers will have a host of monetization options from microtransactions and subscription models to serialized DLC. For gamers, the addition of games-as-a-service means on-going delivery of fresh and exciting digital content on demand, no longer constrained by disc-based media.  This creates the optimal experience for both developers and gamers and will drive the market forward.”

The report analyzes actual consumers spending data from dozens of PC and mobile games.

“The new generation of game consumers has no problem with buying digital content.  While the high-end of the market still is best-suited for disc-based delivery, online digital delivery is expected to take the form of new business models that can substantially grow the overall base” says Cole.

The report forecasts that global console game software revenue will grow from $18.5 billion in 2013 to $24 billion in 2017.

However, the console game market also faces many challenges.  On a global level PC game revenue is expected to remain higher than console game revenue.  Meanwhile mobile game revenue continues to grow but more importantly threatens to take away valuable consumer usage time.  On top of that there is a major battle to control delivery of digital content to the television set.  The report examines how companies like Amazon, Apple, Google, Samsung and Valve could disrupt the plans of the console game manufacturers.  “The battle for digital delivery in the living room could turn into a blood bath with no clear winners.  The challenge for content providers will be how to best monetize their product for any given platform or market,” says Cole.

On Friday, November 1, 2013 at 2pm EST (11am PST), Live Gamer and DFC Intelligence will host a webinar to discuss some of the findings from the report.  To register for the event, please contact corpgeninq@livegamer.com for more information as space is limited.

About DFC Intelligence

DFC Intelligence (www.dfcint.com) is a strategic market research and consulting firm focused on interactive entertainment and the emerging video game, online game, interactive entertainment and portable game markets. Since 1995 DFC has published in-depth strategic market reports and subscription-based research services. DFC research is used by more than 300 leading companies in over 30 countries worldwide.

About Live Gamer

Live Gamer’s mission is to stretch the boundaries of what’s possible and profitable in the ever-evolving economy for digital goods, content and services on a global basis. With the vast capabilities of a dynamic, talented and global team, Live Gamer delivers a broad set of e-commerce solutions to clients across industries including games, media and entertainment and finance and technology, all around the world.

Headquartered in New York with offices around the world, Live Gamer is led by a strong management team with proven success in the digital space. With more than 120 enterprise clients transacting in more than 180 countries, Live Gamer’s goal is to be the partner of choice for monetizing and optimizing new streams of revenue for leading digital businesses today.

For more information on the company and its services, please visit www.livegamer.com.

1 COMMENT

LEAVE A REPLY

Please enter your comment!
Please enter your name here