VGMarket and PlaySpan, released their 2010 Digital Goods Report on Wednesday. The report reveals consumer behavior patterns among existing customers of third-party and first-party online game marketplaces.

The median spent on digital goods in 2009 was:

• $50 per year for Social Networks
• $40 per year for MMOs
• $40 per year for Casual Games
• $40 per year for Free to Play Games
• $37 per year for PC Games with Online Play
• $20 per year for Console Games with Online Play

Other key points include:

• 32% of respondents made purchases within social networks
• Males are playing significantly more games and are the primary drivers of total digital goods sales
• North American women 25 and older are spending disproportionately large sums of money on digital goods
• The average female spent $55 dollars on Social Network games compared to $30 for males

The Consumer Electronics Association (CEA) has predicted that there will be:

• 2.1 Million 3D TVs in 2010
• 6 Million 3DTVs in 2011
• Smartphones will generate $26 billion in 2011
• 54 million Smartphones will ship in 2010
• 66 million Smartphones are expected to ship in 2011

Network World is reporting that the Asia-Pacific PC market (excluding Japan) grew 15% in the quarter and 36% year-over-year in the second quarter of 2010 to reach 27 million units, according to IDC. The growth is double digits in almost all countries.

EEDAR and the Guildhall at SMU released a new study (download it here) on how professional review scores affect purchase intent. There is a correlation between positive reviews helping to drive sales, however it isn’t a direct relationship (but we already knew that). The interesting part is that people not exposed to review scores rated things higher than the media and had higher purchase intent. My takeaway is that if your game isn’t great, don’t send out copies to the media for review and you’ll have more sales.

New Magid Report Finds U.S. 2010 Market for Mobile Virtual Goods to be Estimated at $168M

BURLINGAME, CA & NEW YORK, NY – Jun 22, 2010 – Virtual goods purchased on smartphones are a new emerging market in the United States. Who is actually buying them and how much they’re spending, however, has not been completely understood. Today, Frank N. Magid Associates and mobile social gaming network OpenFeint are shedding some light on the subject by providing the first-ever estimate on how much Americans are currently spending on virtual goods.

According to the study, Magid Media Futures 2010 Wireless and Consumers, Americans spent $168 million on mobile virtual goods in the last year. Magid estimates that over 70 million Americans now own smartphones – that’s 23 percent of the population. With 45 percent of those smartphone owners playing mobile games and 16 percent of those spending an average of $41 per year on in-game virtual goods, the market has already exceeded $168 million.

“The market for virtual goods has already exploded in web-based games like Zynga’s Farmville, and we’re just now starting to see this trend in the mobile space,” said Steve Lin, VP Operations of Aurora Feint. “In just the last few months we’ve seen amazing interest from our game developers in building mobile social games with virtual goods. Our internal numbers reflect the study in that free-to-play models will be the dominant pricing structure in the future.”

With 55 percent of smartphone gamers interested in buying virtual goods, the market is poised for strong growth as more virtual goods-based games enter the market. The study also shed more light on who is likely to play games on smartphones. Compared to the general population, smartphone gamers skew male and are between 18 and 34 years of age.

Smartphone gamers are active consumers of multiple games, downloading 14 games on average per year. Of these games, recipients paid money for 4 games and obtained 10 for free meaning that consumer pay for mobile games at a 2:5 ratio vs. downloading free games. As expected, Americans are most likely to review application store rankings to find games, but are also likely to rely on word of mouth and the suggestions of their friends.

“Everybody knows free-to-play social gaming models on PC platforms have been making a killing but mobile virtual goods aren’t as well understood,” said Mike Vorhaus, President, Magid Advisors. “With almost 20 percent of smartphone gamers already making purchases, there’s a lot of room for the market to keep taking off as smartphones continue to increase in popularity.”

This is the first half of a two-part study that will be released this Summer.

For more information on the mobile virtual goods industry or Aurora Feint, please contact Ken Johnston at ken@vscconsulting.com. Aurora Feint partnered with Frank N. Magid Associates, Inc. www.magid.com to conduct and analyze the mobile virtual goods studies.

About Aurora Feint, Inc.
Aurora Feint, Inc.’s software development kit, OpenFeint, allows game publishers to implement services which enable mobile social gaming. With over 25 million registered users and a presence in over 2,000 games, OpenFeint is the first and largest social gaming platform for the iPhone. Aurora Feint is backed by DeNA Inc.

The Entertainment Software Association (ESA) released it’s annual Essential Facts About the Computer and Video Game Industry covering the U.S. market, this week. You can download the report here. Some of the key points are below:

• The average game player is 34 years old
• The average game buyer is 40 years old
• 26% of gamers were over 50 in 2010
• 67 % of U.S. Households play computer and video games
• 62% of gamers play with others
• 40% of game players are female
• 48% of all games sold are rated ‘E’ for Everyone by the Entertainment Software Rating Board
• 64% of parents believe games are a positive part of their children’s lives
• 76% of parents believe that the parental controls available in all new video game consoles are useful
• 42% of Americans play games on wireless devices such as cell phones or PDAs

Moconews.net announced that Apple has sold more than 2 Million iPads since the launch earlier this year. Analysts predict the install base will increase to 5 Million iPads by the end of 2010.

There are currently:

• 5,000 apps for iPad
• 200,000 apps for iPhone

Newzoo recently released a report on gamers in North America and Europe. Here are the key data points from what they released there is a huge market of more than 290 million game players across North America and Europe:

• USA – 183,500,000
• UK – 31,300,000
• GER – 35,500,000
• FR – 25,400,000
• NL – 9,300,000
• BE – 4,700,000

Consoles

• USA – $15,140,000,000
• UK – £2,390,000,000
• GER – €1,540,000,000
• FR – €2,430,000,000
• NL – €315,000,000
• BE – €310,000,000

PC games

• USA -$4,150,000,000
• UK – £740,000,000
• GER – €1,320,000,000
• FR – €690,000,000
• NL – €170,000,000
• BE – € 150,000,000

Game portals

• USA – $2,780,000,000
• UK – £270,000,000
• GER – €430,000,000
• FR – €190,000,000
• NL – €55,000,000
• BE – €60,000,000

Mobile devices

• USA – $1,100,000,000
• UK – £190,000,000
• GER – €180,000,000
• FR – €100,000,000
• NL – €10,000,000
• BE – €10,000,000

MMOs

• USA – $2,120,000,000
• UK – £190,000,000
• GER – €180,000,000
• FR – €160,000,000
• NL – €45,000,000
• BE – €40,000,000

The Full Industry Report is available at: www.gameindustry.com for €299.

The iPhone Multiplayer Community OpenFeint today announced that they have:

• 8,000 developers using OpenFeint
• 25 Million community members
• Since November 2009, the community has grown 5X and continues to increase in size.

Here’s a chart of their growth:

Niko Partners, the leading market intelligence firm on China’s video game industry, today reiterated the vibrancy of China’s video game industry, based on findings from its newly published 2010 Chinese Video Game industry Annual Review & Five-Year Forecast report.

“Niko forecasts that by the end of this year 93 million Chinese gamers will play a mix of PC online, offline, console and handheld games, yet only the online segment generates legitimate revenue,” said Lisa Cosmas Hanson, managing partner of Niko Partners.

• Niko’s recently forecasted online games revenue in 2010 at $4.52 billion
• There is strong demand for digitally downloaded PC offline games as well as consoles and handhelds, in spite of piracy and the regulation that bans consoles
• Niko calculated that total Chinese game software and services revenue, including PC offline, console, handheld, and (primarily) online games, reached $4.61 billion in 2009, up 28 percent from 2008
• Chinese consumers are entering the online game market at a rapid pace thanks to casual games such as social networking service (SNS) games and other growth drivers.
• China’s 165,000 Internet cafés are used for social entertainment and competition as home PC penetration rises and gamers spend more time gaming at home.
• Chinese console gamers have eschewed previous generation consoles in favor of the Xbox 360, Wii and PlayStation 3.
• The regulatory landscape continues to be burdensome for game companies.
• China could have 100 million new gamers over the next 2-3 years, driven by social networking games, MMOs and casual games.
• Chinese gamers prefer the Free-to-Play (F2P) model of online games in which online operators generate revenue via the virtual economy, rather than the time-based model in which access is provided for a fixed number of pre-paid hours.
• 63% of gamers surveyed increased their spending on online games in the past year.
• Social Networking Sites (SNS) games have gained popularity among Chinese consumers, and 88% of the gamers Niko surveyed claim to play SNS games.
• The primary reasons gamers with PCs at home go to an Internet café are to be social with their friends and to participate in gaming competitions.
• At least 65% of gamers use Internet cafés at least part of the time.
• There were 68 million online gamers in China by our definition at the end of 2009 and by 2014 the number should reach 141 million, a 15.5% CAGR.

The 2010 Annual Review & Forecast report is available now for $8,000, and a subset version focused on online games, the 2010 Chinese Online Games Market Review & Forecast report, is available for $5,000. To purchase, contact: info@nikopartners.com