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GAMES INDUSTRY
OVERVIEW January, 2011
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Agenda
Agenda
Segments and Business Models
The Market
US Market
EU Market – Top 5
Industry Specifics
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Agenda
Agenda
Segments and Business Models
The Market
US Market
EU Market – Top 5
Industry Specifics
Online Game Segments
Main Segments:
• Mobile Games, for example for mobile phone or PDA
• Online Games: Casual, Social, MMOs, Browser-
Based (often considered MMOs)
• Console Games – distribution available both offline
(DVD) or online (wi, PS, Xbox Live, etc)
• Standard PC Games – if purchased online fall under
retail market
Business Models
• Pay-to-Play (client based) – customers have to pay
an initial amount in order to start playing – Star Craft
II, Diablo, Guild Wars, most Yahoo Games
• Customer in most cases have to download the game
in order to play it
• This business model is slowly shifting towards Free-
to-Play
• Some major MMOs are based on this business model
Business Models
• Free-to-Play – customer can play the game without
paying anything.
• Virtual currencies are available to advance in the
game – Mafia Wars, Farmville
• Customers most play such games in a web browser
• Most gaming developers and publishers are moving
towards this business model
Business Models
• Play-to-Pay at “x” – Customers pay based on a
certain criteria - level reached (every 5th level),
special DLCs (unlocking special areas)
• In most cases, customer have to download the game
in order to play it
• Sometimes this business model is coupled with a
small initial amount
• One of the best ways to monetize games
Business Models
• Subscription based– Customers pay a small initial
amount to have the game + monthly fee to play it –
World of Warcraft, Conan
• In most cases, customer have to download the game
in order to play it
• The best monetization business model but also the
most difficult to achieve
• Only a few gaming companies have managed to use
it successfully
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Agenda
Agenda
Segments and Business Models
The Market
US Market
EU Market – Top 5
Industry Specifics
Share of Games Wallet Across Platforms
Source: gamesindustry.com. Black Book 2011
MMO Revenue 2010
Source: gamesindustry.com. Black Book 2011
Playing vs Paying I MMOs 2010
Source: gamesindustry.com. Black Book 2011
Playing vs Paying I Game Portals 2010
Source: gamesindustry.com. Black Book 2011
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Agenda
Agenda
Segments and Business Models
The Market
US Market
EU Market – Top 5
Industry Specifics
US Market – Survey 2010
Source: gamesindustry.com. Black Book 2011
US Market 2010
Source: gamesindustry.com. Black Book 2011
Social Games 2009
Source: gamesindustry.com. Black Book 2011
MMO Game Revenue 2009
Source: gamesindustry.com. Black Book 2011
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Agenda
Agenda
Segments and Business Models
The Market
US Market
EU Market – Top 5
Industry Specifics
UK 2010
Source: gamesindustry.com. Black Book 2011
Germany 2010
Source: gamesindustry.com. Black Book 2011
France 2010
Source: gamesindustry.com. Black Book 2011
Netherlands 2010
Source: gamesindustry.com. Black Book 2011
Belgium 2010
Source: gamesindustry.com. Black Book 2011
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Agenda
Agenda
Segments and Business Models
The Market
US Market
EU Market – Top 5
Industry Specifics
Industry Specific
• MMO games represent the largest portion of online
games, followed by wireless games
• Wireless games are expected to grow by 14% on an
annual basis reaching to up to $13 billion in 2013
• The three largest game producers are – the US,
Japan and the UK, followed by Germany and
Australia
• Around 41% percent of gamers are women
Industry Specific
• Predominant payment method used for game
purchases – credit cards
• Larger MMOs depend heavily on alternative payment
methods
• The industry is one with many chargebacks,
especially in the Free-to-Play business model
• Games will shift towards the Free-to-Play business
models in the next couple of years
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