Monday, 28 January 2008

Online Gaming Subscription Growth a Key for Game Makers

Though 2007 was another strong year for video game makers, the gaming console hardware business is costly, reports In-Stat. Therefore, the three main vendors have turned to online...

Though 2007 was another strong year for video game makers, the gaming console hardware business is costly, reports In-Stat. Therefore, the three main vendors have turned to online gaming either to generate additional revenue streams or to promote brand loyalty, the high-tech market research firm says.

"The primary differences among Nintendo's, Sony's, and Microsoft's online efforts are mainly of scope," says Stephanie Ethier, In-Stat analyst.

"Microsoft is looking to create a number of revenue streams through its Live service, including its subscription service, paid casual games, and additional paid content. Sony is following a model similar to that of Microsoft's, except for the subscription service.

Nintendo is limiting its revenue to paid downloads for Nintendo and partner games."

Recent research by In-Stat found the following:

- From 2004 to 2011, annualized growth of console subscribers will be 42.7%, and growth of handheld subscribers will be 37.1%.

- Of the respondents to an In-Stat gaming survey who currently own and use an Xbox or Xbox 360, 32% subscribe to Xbox Live.

- Another potential revenue generator is in-game advertising, particularly dynamic advertising.