Archive for the ‘ Online Gaming ’ Category

According to Pearl Research with its new “Online Games Market in Korea” study, the online games market in Korea is forecasted to exceed $2 Billion in 2011. Other key points from the report include:

  • 3 of the top 5 game operators in Korea grew their revenues more than 50% in 2009
  • Korean game companies have prioritized establishing international operations with the United
  • States, Europe, Japan and China as the leading target markets.
  • Nexon’s global revenue was $585 million in 2009
  • Neowiz’s overseas revenues, which consists of licensing and revenues from international, was $52 million in 2009
  • South Korea has one of the highest Internet and personal computer (PC) usage rates worldwide at 80%
Challenges to the market  include:
  • A glut of content
  • Increasing government scrutiny
  • Rising development costs

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

Games Convention Online is interested in having speakers give lectures on Business & Legal (e.g. business models; micropayments; start-up & Investment topics; data security), Development (e.g. game design; programming & production; open source), Browser GamesClient-based GamesMobile GamesSocial Games (e.g. connection to browser games) and Internationalization (e.g. localization, international networks, community management).

GCO takes place July 8-11, 2010 in Leipzig, Germany. You can submit a speaker proposal here.

New research from The Diffusion Group (TDG) finds that one-third of U.S. broadband households now use a game console that is connected to the Internet:

  • 78% of PS3s are online
  • 73%of Xbox 360s are online
  • 54% of Wiis are online

IE Sherpa Opinion: Data isn’t available on the ARPPU from digital purchases on any of the platforms, however having purchased from each of the systems, XBLA and PSN are very similar in how easy it is to transact. My preference would actually be PSN since you don’t have to purchase points that tend to result in small unused balances in your account. This is the easiest for consumers with a credit card. The Wii is the most difficult to navigate and given the audience should be the easiest to purchase on, but it isn’t.

Women Are Gaming

A study from Q Interactive and Social Media World Forum of more than 2,000 women in November of 2009 found them actively engaging with brands as they partake in social media gaming. The report also states:

50% of U.S. women play online games according to Pew Internet

The online social-gaming market is expected to at least double from $720 million to over $1 billion by 2010 according to Think Equity

The study also establishes a picture of the typical woman engaged in social media games and applications:

  • 85% of those surveyed use five or less games and/or apps regularly, indicating an inclination to be loyal to a handful of favorites; approximately 15% regularly invest in six or more games/apps at a time
  • 57% are earning/spending virtual currency daily
  • 74% got involved in a game or app due to a recommendation by family or friend or because they noticed a friend or family member’s score
  • 95% utilize virtual currency primarily to gift and/or advance games
  • In interacting with games and apps, 57% feel virtual gifting – for example, giving a bag of virtual makeup from Sephora – is as meaningful as real life gifting
  • 97% of women prefer to earn virtual currency through either winning more or accepting a branded offer – versus paying for it with “real” money
  • Only one in ten women have actually used “real” money to purchase virtual currency; of that, 85% have spent under $100 in their gaming and aping activities – ever
  • Of women who have signed up for branded offers to get more virtual currency, 67% found the offer useful
  • 37% of those women chose the branded offers based on “content”; 17% went for offers with free products or services

A follow up study in February, 2010  Q Interactive and Engage! Expo  revealed insight into the psychology of women who play social media games, the largest demographic of social media users. The study of over 700 women, about 54% of which play daily and 30% weekly, investigates a range of viewpoints around salient social media gaming topics. This is the company’s third recent proprietary research study from its “Women’s Channel.”

Of those surveyed, 42% consider themselves gamers and 7% deem themselves obsessed:

  • For 67%, one to five hours per week is socially acceptable
  • 26% feel six or more hours per week is socially acceptable.
  • Nearly 45% of those surveyed have friends they consider obsessed with social media gaming.
  • Approximately 16% of those surveyed hide or sometimes hide their gaming habits.

Over two-thirds of those surveyed believe there are stigmas associated with gaming. For those women, the leading stigmas are:

  • Games are addictive (24%)
  • Play makes you neglectful of other areas of your life (21%)
  • Gaming is a waste of time (17%)
  • Play at work is basically off limits: 93% of those surveyed share they primarily play at home versus work.

More than half of women surveyed, 54%, fear more games will make gamers pay in the future:

  • If forced to pay, 77% would give up the game, while:
  • 10% would prefer a monthly subscription or fee
  • 10% would prefer a pay-as-I-go system
  • 2% would prefer a separate payment scenario for each game played

Chris Sherman Founder of the Engage! Expo said, “…  moms and kids are both wired into social media gaming… however, mom… is actively supervising the time her kids play and what they spend”

  • Overall kids (children under 18 years old) are connected: 16% of moms say their children have a smart phone.
  • According to mom, 40% of kids are allowed to play daily, 37% weekly, and 10% monthly.
  • Generally speaking, kids are banned from the wallet: 80% are not allowed to pay for social media gaming.

The February study is available here, and the November study is here.

Our friends over at VentureBeat have sent over a code that will save you $50 off of registration to the event. We were at last year’s GamesBeat and it was definitely worthwhile. I would recommend it to anyone looking at the business behind virtual worlds, online games, venture capital for game companies, or funding in general. It pulls a good mix of game industry/Silicon Valley.

GamesBeat@GDC 2010 will be held on March 10th in San Francisco and will feature the theme Disruption 2.0.  The one-day executive conference will explore the future of gaming and the effects of the iPhone, iPad, social media, digital distribution, and online gaming on the industry.  Leading speakers will include:

  • Steve Perlman, CEO of On-live
  • John Schappert, COO of EA
  • Bryan Reynolds, Chief Designer of Zynga
  • Klass Kersting, CEO of Gameforge
  • Neil Young, CEO ngmoco
  • Gareth Davis, Platform Manager of  FaceBook
  • Bart Decrem, CEO Tapulous

An others. Join 400 other gaming industry leaders for a day of panels, keynote and networking. Register here to receive $50 off your GamesBeat@GDC registration using the following code:  GBEATSP.

Alex St. John, hi5’s President & CTO, will unveil the details of hi5’s new Game Developer Program at the Game Developer Conference in San Francisco Wednesday, March 10, 2010 from 4:15 PM – 5:15 PM (PT). hi5 is the largest social media site built specifically for games. The session is targeting social game developers looking for life beyond Facebook as well as online game developers that want to socialize and monetize their games.  hi5 will tell you everything you need to know to get your game distributed to their global audience of over 50 million monthly visitors. hi5 offers game developers:

  • Free marketing and promotion across the hi5 network for new games launched exclusively on hi5
  • Revenue share on advertising and commerce using hi5 Coins payment platform supporting over 60 payment methods
  • A dedicated game portal and game promotional area to facilitate discovery of your game
  • One-click automatic game installs, so you don’t lose users at the installation step
  • Super-charged social channels which don’t artificially cap or limit the ability for your game to go viral.

hi5’s new Game Developer Program is a different model for social games.  Representatives from engineering, marketing and business development will be on-hand to answer all your questions and anyone with a GDC Expo pass can attend. RSVP here: http://hi5games.eventbrite.com/

According to a story in Reuters, China’s online game revenue has grown 30.2% over 2008 revenues to $3.97 Billion. The article also estimates that there are:

  • 50-60 Million online gamers in China
  • This represents almost 20% of the people online in China
  • Revenue is expected to double over the next three years

Niko Partners Logo

Niko Partners is the leading analyst firm covering the China Games Market – according to today’s Niko Partners’ newsletter:

  • There are now 134,000 licensed Internet Cafes in China.

Niko states: “The previous number was 114,000, though we know that provinces had the right to override the ban in tier 3 and 4 cities as demand warranted new licenses. The Niko estimate for licensed and unlicensed cafés of 30 or more seats is 170,000.”

You can sign up for the newsletter here if you are interested in following the game market in China.

Our friends at GamesBeat has an article about a new NPD Group survey with some new demographic data on the U.S. games industry:

  • 82% of kids 2-17 years old say they’re video gamers
  • 55.7 million kids are playing games
  • 9.7 million kids who are playing games are ages 2-5 years old
  • 12.4 million kids who are playing games are ages 9-11 years old
  • They play games 10.6 hours a week on average
  • Kids use an average of 2.5 systems to play
  • 51% of kid gamers play online, and online players are more likely to be 9-14 years old and male