Post by Segaman on Mar 29, 2004 18:12:05 GMT -5
Everyone involved with gaming knows that the industry is big business. With individual game sales reaching into the millions and spanning worldwide markets, you'd figure the revenue streams should be flowing rather nicely. Well, a recent report by DFC Intelligence, a strategic market research and consulting firm focused on interactive entertainment, discusses the similarities between the film and music industries and the interactive entertainment industry and suggests that gaming will continue to enjoy worldwide growth.
"Revenue for the video game industry could pass the music industry in the next five years." said David Cole, lead author of The Business of Computer and Video Games 2004, and DFC president. "More adults are playing games, the industry is expanding on a worldwide basis and online distribution is becoming a reality,"
With the rising costs of game development and marketing, however, Cole is quick to point out that game developers and publishers need to keep a close eye on the cost effectiveness of their industry.
"The interactive entertainment industry is still nowhere near the size of the movie industry," says Cole. "However, production values are starting to compare with those in feature films. Increasing consumer expectations, along with other factors including the rising cost of talent, the need for large-scale marketing campaigns, adding online components and demand for high profile licensed properties are substantially increasing costs."
Meanwhile, lead author Dave Watson headed up another report entitled The Impact of Licensing in Interactive Entertainment, which outlines the importance of licensed brands in the games industry. Watson states, "Companies are quickly learning that for certain well-known properties licensed from other media, having the best brand can be better than having the best game play."
The DFC reports that household penetration of game consoles in the U.S. is now around 43 percent, but that the majority of the industry's growth stems from increased usage within those homes, which are more frequently offering multiple gamers and even consoles.
The DFC also suggests that places like America and Japan are not the deciding factor in expanding success of the industry, but rather to maintain growth in those and other core markets while reaching other international territories such as South Korea, Taiwan, Singapore, mainland Asia, Australia, and Eastern Europe.
With so much promise in the interactive entertainment industry, it will be interesting to see how the individual companies plan their development and marketing strategies over the years to come in order to bring gaming to the level of success enjoyed by film and music.
"Revenue for the video game industry could pass the music industry in the next five years." said David Cole, lead author of The Business of Computer and Video Games 2004, and DFC president. "More adults are playing games, the industry is expanding on a worldwide basis and online distribution is becoming a reality,"
With the rising costs of game development and marketing, however, Cole is quick to point out that game developers and publishers need to keep a close eye on the cost effectiveness of their industry.
"The interactive entertainment industry is still nowhere near the size of the movie industry," says Cole. "However, production values are starting to compare with those in feature films. Increasing consumer expectations, along with other factors including the rising cost of talent, the need for large-scale marketing campaigns, adding online components and demand for high profile licensed properties are substantially increasing costs."
Meanwhile, lead author Dave Watson headed up another report entitled The Impact of Licensing in Interactive Entertainment, which outlines the importance of licensed brands in the games industry. Watson states, "Companies are quickly learning that for certain well-known properties licensed from other media, having the best brand can be better than having the best game play."
The DFC reports that household penetration of game consoles in the U.S. is now around 43 percent, but that the majority of the industry's growth stems from increased usage within those homes, which are more frequently offering multiple gamers and even consoles.
The DFC also suggests that places like America and Japan are not the deciding factor in expanding success of the industry, but rather to maintain growth in those and other core markets while reaching other international territories such as South Korea, Taiwan, Singapore, mainland Asia, Australia, and Eastern Europe.
With so much promise in the interactive entertainment industry, it will be interesting to see how the individual companies plan their development and marketing strategies over the years to come in order to bring gaming to the level of success enjoyed by film and music.
