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Online and Mobile Gaming - US

Product Type: Market Research Report
Published by: Mintel International Group Ltd.
Published: December 2005
Product Code: R560-1837
Description
Reaching nearly $1.9 billion in 2005, the market for online and mobile gaming in the U.S. grew 288% since 2002. In this report, Mintel clearly identifies the principal external factors driving or curtailing growth in online and mobile gaming. Online gaming has become a regular part of the leisure mix for adults, teens, and kids. Casual game categories--puzzles and strategy, card and board, and classic arcade games--are popular in the web-browser/downloadable games and mobile segments of the market. Women, who favor these games, represent a larger portion of online gamers than do women in the traditional video console market.

Mintel’s exclusive consumer research reveals the attitudes, needs and behavior of online and mobile gaming consumers, with analysis broken down both by demographic characteristics, and by gaming type. Six years of specific sales data provide a factual and impartial presentation of the market as a whole. Mintel also evaluates the performance of individual sectors in the market and provides information about the major companies and brands.

Mintel uses the SPSS forecasting package to create a five-year forecast of U.S. retail sales in online and mobile gaming, revealing potential opportunities for growth and product development. Based on Mintel research, overall growth in the market should remain strong, resulting from four factors:
  • Increasing penetration rates for broadband Internet and 3G wireless phone networks
  • A greater proportion of the population has grown up gaming and will continue to play as they age
  • Increased awareness of mobile gaming and online gaming capabilities as a result of new entries into these markets from established game companies with licensed titles and larger marketing budgets
  • In-game advertising is becoming a desirable choice for major marketers
For the purposes of this report, online gaming is defined as all revenue streams associated with games that are played on a personal computer either online (e.g. via a web browser) or gaming software downloaded and played on the personal computer.
Table of Contents
Introduction and Abbreviations

Introduction

Other relevant reports

Definition

Abbreviations and terms

Abbreviations

Terms



Executive Summary

CAGR of 42% since 2002

Sales expected to double by 2008

Technology enables game play; content satisfies consumer preferences

Women, adults, casual gamers

PC gaming continues to gain popularity

Competition from other gaming formats and free games

Market participants wear many hats

Established content providers gaining traction

Consumer trends

Future trends



Market Drivers

Hardware and communications penetration

Broadband

Figure 1: U.S. broadband household projections, 2000-10

Figure 2: Types of PC games played, by type of Internet access, October 2005

Mobile phones

Figure 3: U.S. Mobile phone subscribers and penetration rate, 2000-05

Download-enabled phones

Advances in cell-phone technology and mobile games

Variety of content available

Figure 4: Number of games offered by the major cell phone carriers, 2005

Adults, women, important markets for online and mobile games

Figure 5: Computer and console gamers, by age, 2005

Women and online gaming

Figure 6: Target markets for PC Games, by type of game

Figure 7: Genres of games played online, by gender, October 2005

Women and mobile gaming

Leisure/lifestyle changes

Figure 8: Favorite leisure-time activities, 1995-2004

Gaming

Competition from other gaming platforms and free content

Game consoles and console software

Free content

Advergames



Market Size and Trends

Figure 9: Total U.S. sales of online and mobile games, at current and constant prices, 2002-05

Figure 10: Graph: Total U.S. sales of online and mobile games, at current and constant prices, 2002-05



Market Segmentation

Overview

Figure 11: Sales of online & mobile games, segmented by type, 2003 and 2005

Figure 12: Graph: Sales of online & mobile games, segmented by type, 2003 and 2005

Web and downloadable games

Figure 13: Sales of Web & downloadable games, at current and constant prices, 2002-05

Multiplayer Online Games (MMOG)

Figure 14: Subscription sales of MMOGs, at current and constant prices, 2002-05

Figure 15: MMOGs ranked by worldwide subscribers (excluding Lineage, Lineage II and Ragnarok online, May 2005

Mobile Games

Figure 16: Sales of mobile games, at current and constant prices, 2002-05

Figure 17: Mobile game purchases by type of game and gender, Feb-April 2005

Figure 18: Best-selling mobile game titles, Feb-April 2005



Supply Structure

Overview

Figure 19: Market participants by segment

Company profiles

Airborne Entertainment

The Beijing Digital-Red Mobile Software Co. (Digital-Red)

Blizzard Entertainment (Vivendi Universal)

CCP

Digital Chocolate

Disney

Electronic Arts

Funkitron

GameHouse

Gameloft

Glu Mobile (formerly Sorrent)

Gravity Online

HipSoft

iFone

I-Play (formerly Digital Bridges)

In-Fusio

iWin

Jagex

JAMDAT Mobile (EA)

MFORMA

Mythic Entertainment

Namco America

NCsoft

PlayFirst

PopCap Games

Reflexive Entertainment

Sony Online Entertainment

Sprout Games

Square Enix

Superscape Group

THQ Wireless

Turbine Games



Advertising and Promotion

Overview

Company Activity

AOL Games

Cingular Wireless

GameHouse/RealArcade

GameTap

Oberon Media

PlayFirst

PopCap Games

Pogo.com

Shockwave.com

Yahoo! Games

Revenue from advertising

Figure 20: U.S. online gaming advertising revenue forecast, 2004-08*



Retail Distribution

Overview

Web and downloadable game distributors

AOL Games

AtomShockwave/Shockwave.com

Big Fish Games

Happy Puppy

Microsoft Zone

Pogo.com (Electronic Arts)

RealArcade/GameHouse

Yahoo! Games

Aggregators to third-party websites

Trymedia

Oberon Media

Mobile Game Distributors

Introduction

Figure 21: Operating revenue for wireless service providers in the U.S., 2002 and 2004

Verizon Wireless

Cingular Wireless

Sprint Nextel

T-Mobile USA, Inc.

Alltel

Third-Party Mobile Game Distributors

Nokia

MMOG Distributors



The Consumer

Introduction

Participation in online gaming

Figure 22: Frequency of online game play, May 2004-May 2005

Frequency of game play

Figure 23: Mean monthly occasions of online game play, by select demographics, May 2004-May 2005

Influence of console and portable gaming on online gaming

Figure 24: Online game play cross-tabulated with game console ownership, May 2004-May 2005

Attitudes of online gamers compared to users of online services

Figure 25: Attitudes of online gamers compared to online service users, May 2004-May 2005

Types of games played

Figure 26: Types of games played on the PC, by gender, October 2005

Figure 27: Types of games played on the PC, by age, October 2005

Figure 28: Graph: Types of games played on the PC, by age, October 2005

Mobile games

Figure 29: Interest in mobile games, by age, October 2005

Figure 30: Graph: Interest in mobile games, by age, October 2005

Figure 31: Interest in mobile games, by household income, October 2005

Figure 32: Interest in mobile games, by marital status, October 2005

Figure 33: Interest in mobile games, by presence of children in the household, October 2005

Sources of purchase information for games

Figure 34: Sources of information about games, by gender, October 2005

Figure 35: Sources of information about games, by age, October 2005

Figure 36: Sources of information about games, by marital status, October 2005

Genres of games played online on the PC

Figure 37: Types of online games played on the PC, by gender, October 2005

Figure 38: Types of online games played on the PC, by age, October 2005

Figure 39: Types of online games played on the PC, by marital status, October 2005

Figure 40: Types of online games played on the PC, by presence of children under 18, October 2005

Purchase behavior toward mobile phone games

Figure 41: Opinions about mobile gaming, October 2005

Spending on online and mobile games

Figure 42: average spending on online and mobile games, October 2005

Summary



Future and Forecast

Future trends

Overview

Broadband penetration to push online gaming

3G wireless networks to push gaming

Figure 43: 3G status and forecast for leading U.S. carriers, 2005

Release of next generation consoles will draw attention to this platform

In-game advertising to become a significant revenue stream

Figure 44: U.S. in-game advertising revenue forecast, 2003-09

Lines between platforms will continue to blur

Increased competition from portable game players

MARKET FORECAST

Online and mobile games

Figure 45: Forecast of total U.S. sales of online and mobile games, at current and constant prices, 2005-08

Figure 46: Graph: Forecast of total U.S. sales of online and mobile games, at current and constant prices, 2005-08

Web and downloadable games

Figure 47: Forecast of U.S. sales of web and downloadable games, at current and constant prices, 2005-08

MMOGs

Figure 48: Forecast of U.S. subscription sales of MMOGs, at current and constant prices, 2005-08

Mobile games

Figure 49: Forecast of U.S. sales of mobile games, at current and constant prices, 2005-08

Forecast factors



Appendix: Trade Associations



Appendix: Game Magazine Circulation

Figure 50: Paid circulation in game magazines



Appendix: Cohort Definitions



Appendix: Research Methodology

Consumer Research

Greenfield Online

ICR Surveys EXCEL

Simmons National Consumer Surveys

Technometrica TechnoExpresssm

Trade Research

Informal trade research

Formal trade research

Desk & Internet Research

Sources

Definitions

Forecasts

Mintel Group

Mintel Reports

Mintel Premier

Mintel GNPD

Mintel Menu Insights

Mintel Comperemedia

Mintel Custom Solutions
Ordering and More Information
Price and Delivery Options



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