Video Game Business to Double by 2011, Driven by Online and Mobile Gaming


null - February 15, 2006

The video game market will expand from $32.6 billion in 2005 to $65.9 billion in 2011 as a result of its fast-growing online and mobile gaming segments, according to a new study from ABI Research. The market's largest segments today - console, PC and handheld hardware and software - will remain significant, but overall they will see much lower growth rates than the emerging segments.

The online gaming market, comprised of console, PC and handheld Internet gaming, will grow at a 95% annual rate for the forecast period. Online console gaming, PC casual web gaming and Massively Multiplayer Online (MMO) gaming will see strong overall growth as gaming software title distribution, gaming multiplayer and community services and online gaming-related content sales help propel this market.

"The online console gaming market is set to take off, as the new generation of consoles arrives with advanced networking and online gaming capabilities," says Michael Wolf, principal analyst of broadband and multimedia research. "The ability to download game demos, buy casual as well as full-fledged console games, and access advanced content, including HD video, will result in 'online' becoming the key technology component of gaming for this and subsequent console generations."

Mobile gaming is set to see significant growth through 2011, as the flood of interest from game publishers and mobile operators results in both ported and original game titles for download by mobile subscribers. Recent efforts by mobile gaming giants to develop an open gaming architecture in order to reduce development fragmentation will open the doors to more content for consumers and overall higher revenues for game downloads.

"Gaming has become a mass-market entertainment industry on a par with TV, movies and music," adds Wolf. "Segments such as video game advertising, set to become a market worth close to $3 billion by 2011, will result in the further maturing of this industry. The ability to play music and media from powerful consoles and handhelds will drive overall industry growth as consumers begin to view gaming devices as one-stop-shop entertainment platforms."

The new ABI Research study, "Video Game Hardware, Software and Services", examines all hardware platforms (console, handheld, PC), software markets (console, handheld, PC, mobile and online) and the online services gaming markets from a hardware, software and services perspective.

It forms part of the firm's Consumer Electronics, Digital Media Distribution and Management, and Mobile Devices Research Services, all subscription products that include research reports, regular market updates, ABI Insights, forecast databases, vendor matrices and analyst inquiry time.

Founded in 1990 and headquartered in New York, ABI Research maintains global operations supporting annual research programs, intelligence services and market reports in automotive, wireless, semiconductors, broadband, and energy. For information visit www.abiresearch.com, or call +1.516.624.2500.