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Wednesday, March 26, 2014
Video Game Discs Still Top Market

Gamers keep buying video game discs but online and mobile alternatives are gaining market share, according to a forecast from Strategy Analytics.

About 41% of games ($25.5 billion) will be purchased globally on disc, compared to 68% in 2009. Another 31% ($19.4 billion) will be purchased digitally online (up 21% from 2009), while 28% ($17.3 billion) will be for mobile (up 250%).

Disc drives remain a significant part in gaming systems, as Microsoft showed with the inclusion of a a Blu-ray Disc drive in the Xbox One.

"Disc-based games -- won't ever recapture the peak years of the PS2 and Wii generations, [but they will continue to lead]," Eric Smith, analyst at Strategy Analytics' digital consumer practice, said in a statement.

Smith added that there continues to be a large and sustainable market globally for disc-based games, particularly in North America and Western Europe where the format remains the bedrock of games spending ? accounting for over twice the market share of Asia.

Growth in the gaming industry will come from mobile and online gaming. The number of people playing mobile games is projected to grow 14% in to 1.7 billion and should cross the two billion mark in 2016.

Smith said evolving business models in retail, rental, subscription-based video-on-demand and micro-transactions will include cloud-based storage.

"Console manufacturers must continue to offer a differentiated and higher quality experience than is available on other devices such as handsets or tablets," he said. "These [experiences] should be sufficient to sustain at least two high-end games consoles [PS4 and Xbox One] for another hardware generation after the current one. We expect spending on consoles and disc-based games to peak in 2016."

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