Online Gaming Revenues to Triple by 2009
Networked gaming and digital distribution drive business model diversification
Dallas, Texas December 14, 2005 — Revenues from U.S. online gaming services will increase from $1.1 billion in 2005 to more than $3.5 billion in 2009, according to Networked Gaming: Driving the Future, a new report from Parks Associates. Networked gaming services, including online console gaming, massively multiplayer online gaming (MMOG), multiplayer Internet gaming, and mobile multiplayer gaming, will account for almost 50% of online gaming revenues in 2009, followed by digital downloads at 23%.
“The two primary drivers for online gaming are networked services and digital distribution,” said Yuanzhe (Michael) Cai, director of broadband and gaming for Parks Associates. “Over the next four years, the gaming industry will no longer depend solely on retail sales but will see more balanced and diversified business models.”
The report also concludes that games-on-demand services will complement digital distribution and, in addition, game publishers and service providers could generate significant derivative revenue from in-game advertising and secondary market exchange.
“The gaming industry is definitely learning valuable lessons from the video industry — syndicated game networks such as GameTap can extend a game’s release window and in-game advertising can lead to innovative business models such as free MMOG,” Cai said. “Furthermore, we believe more game publishers and service providers will find ways to monetize the in-game economy, instead of fighting against it.”
Networked Gaming: Driving the Future discusses consumer adoption of networked gaming, including consumer profiles and interest in connected and cross-platform gaming. It also covers the technology solutions enabling such services and examines the market impact and revenue opportunities for game developers, hardware manufacturers, and broadband service providers.
About Parks Associates: Parks Associates is a market research and consulting firm focused on all product and service segments that are “digital” or provide connectivity within the home. The company’s expertise includes home networks, digital entertainment, consumer electronics, broadband and Internet services, and home systems.
Founded in 1986, Parks Associates creates research capital for companies ranging from Fortune 500 to small start-ups through market reports, multiclient studies, consumer research, workshops, and custom-tailored client solutions. Parks Associates also hosts Fall Focus and co-hosts CONNECTIONS each year. www.parksassociates.com