Offline gaming market trends: the end of an era
The declining market for PC games on physical media
The volume of games sold on physical media is declining. At the end of 2011, approximately 130 million games could be sold worldwide. It is estimated that by 2015, only 71.3 million will be sold. The average selling price of a game is stabilizing at around 20.7 EUR. It will lose -0.2% over the study period. The world market, which experienced a slight economic rebound in 2009, is now in irreversible decline and may only be worth EUR 1.5 billion in 2015.
Online gaming market trends: towards more segmentation
World of Warcraft (Activision/Blizzard Entertainment) remains the undisputed leader in massively multiplayer premium games. Based on a subscription model, which is less and less popular among gamers, it had 11.4 million subscribers paying an average of 15 EUR per month in March 2011. As a reminder, the game was released in 2004 and has undergone three expansions, the latest of which was published in December 2010: World of Warcraft: The Burning Crusade, World of Warcraft: “Wrath of the Lich King”, World of Warcraft: “Cataclysm”. WoW leaves little room for its competitors wishing to evolve in a similar, so-called premium model. The latter is forced, and this is perhaps a lifeline for them, to move towards a model called free2play, more open, and which is also gaining in popularity year after year.
An increasingly fine and visible segmentation
There are now two main market segments in online gaming: premium games and free2play games. Thus, we also distinguish two major categories of players using the same terminology. Free2play can in turn be the object of sub-categories: games and casual gamers, massively multiplayer free and social games. Between 2007 and 2008, casual gaming made a notable appearance in the typology of video games. It is part of the general orientation of games to become more and more “casual”. It is still widely present in every market segment today, mainly online. Its importance overshadows the fact that it continues to grow on the Internet and to be deployed on all platforms, whether or not in ubiquitous mode.
At the end of 2011, this segment represents more than 70 million paying players on computers connected to the Internet. Free massively multiplayer games, accessible in the browser or by downloading and installing client software, will have around 30 million paying players at the end of 2011. They compete with premium games, which, with almost 150 million paying players at the same date (including more than 127 million in Asia/Pacific), have a serious competitive edge. These market segments will continue to grow, notably with the arrival of HTML 5, which will enrich the browser with real-time graphic content. After an explosion in 2010, the social network gaming market segment confirmed in 2011 that it is a long-term phenomenon, both on the Internet and on other gaming platforms.
Federating and the main lever of ubiquity, the social network is the new multiplayer platform, based on virality and community. After a phase of concentration that was as intense as it was financially massive, the social network gaming market segment continues to grow, with an increasingly surprising audience volume. As an example, Zynga, the undisputed leader of the genre on Facebook, has nearly 250 million active players/month in June 2011. Since June 2010, Facebook has been using Facebook Credits, a virtual currency that pursues the goal of monetizing social network transactions. As of mid-June 2011, 355 games and applications are using Facebook credits out of 130,000 registered.
Players and market: confirmation of potential
Number of players
The number of online gamblers has continued to grow. At the end of 2011, it exceeded 450 million. Four years later, online gaming will have more than 708 million players. More than 70% of these players will be of Asian origin, as online gaming practices and digital distribution have become more quickly established on that continent. The EMEA zone, with its population base, has significant room for growth. In 2011, it will exceed 50 million players.
Average Revenue Per User (ARPU)
In 2011, the world ARPU could amount to 29.5 EUR. It will decline slightly until 2014, as the propensity to pay players increases less quickly than the rate of arrival of new players. Disparities are significant from one continent to another. North America remains the continent that allocates the most budget per player per year to online gaming, followed by EMEA, Asia/Pacific, and Latin America.
Online gaming is the most dynamic segment of the video game market along with the cell phone gaming segment. In 2011, worldwide, its revenues are expected to reach EUR 13.3 billion and, by 2015, according to IDATE, should see average annual growth of around 11.9% and total growth of more than 56.7%. By 2012, this video game segment will become the largest in value on the market. It will be ahead of the games segment for home consoles. Asia/Pacific is the main driver of this growth and the size of this segment. Similarly, in 2015, China will account for 30.5% of the global revenues of this segment, or EUR 6.4 billion.