Game sales to hit $81 billion by 2016 - Analyst

DFC Intelligence predicts 21.6 percent climb from 2010 levels in total worldwide sales; online business leading growth, to surpass retail beginning in 2013.

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As the game industry has shifted from retail to digital distribution in recent years, it has become harder to accurately gauge whether the market is growing or shrinking, and by how much. However, according to DFC Intelligence, total game-industry sales will continue to explode in the coming years, growing from $66.6 billion in 2010 to $81 billion by 2016.

DFC expects digital dollars to surpass retail by 2013.

DFC Intelligence's forecast, which was announced this week as part of its annual Worldwide Market Forecasts for the Video Game and Interactive Entertainment Industry report, factors in myriad sales channels. These include revenues from dedicated console and portable hardware and physical and digital software. The firm's figures also include software sales on platforms where gaming isn't the primary use, such as mobile phones, tablets, and music players.

"Overall the game industry is becoming more diversified and global as it continues to grow," said DFC Intelligence analyst David Cole. "This makes the industry challenging because it is hard to know where to place one's bets. At the same time, there are many niches of opportunity that didn’t exist in the past."

According to the report, the largest area of growth is from online sales. Revenue from online PC, console, and mobile games is expected to grow from $19.3 billion in 2010 to $37.9 billion in 2016. Retail, on the other hand, has seen a definite slide. Following its peak in 2008 of $58 billion, global retail sales are expected to steadily decline to $43 billion by 2016.

"On a global basis it looks like retail delivery of physical software peaked in 2008," Cole said. "We expect a slow, steady decline for physical game sales, with a steady increase for online delivery of games and new business models such as subscriptions and virtual item sales." DFC Intelligence expects online business will surpass retail beginning in 2013.

DFC Intelligence has been offering far-future forecasts for the game industry for years. In 2006, the analyst group predicted that global game-industry revenues would reach $44 billion by 2011. As mentioned above, that figure was easily surpassed in 2010, when total global sales were $66.6 billion, according to DFC's figures.

Discussion

26 comments
KrazzyDJ
KrazzyDJ

A lot of people prefer physical copies of games I guess (myself included). I wonder then how digital sales surpass retail sales !!!

BoabDreeps
BoabDreeps

I think the games industry could be in for a shock. Recent developments are only serving to disenfranchise gamers. Expecting us to shell out for every new revenue stream they think up is going to result in a backlash.

servb0ts
servb0ts

These guys are in for a rude awakening. I know and read a lot of people that are uncertain about buying next gen, because the BS we're getting now. If developers think paying consumers, are willing to bend over and take it. Are going to End up getting B!tch Slapped with Lost Jobs, as the sulk in the corner and cry milk out their eyes.

terrascythe
terrascythe

By 2016 new releases will cost $80 or more, but that's only because your currency has been devalued. Profits it will also increase accordingly. Profits and sales will increase, but given inflation their will be no actual change. @rockysquirrel Public education is a shame. Please break the left-right paradigm and wake up to the fact that your money is being devalued every day. In actuality new games should cost more, hence the move towards low cost, tax-free downloads. Us rich folk can buy any console or game we choose, yet we still look at the payoff, that never changes regardless of income or political affiliation. Game's are not a hedge, they're simply massive entertainment vectors that have very high cost and low resale value. The only safe bet is not to play the game.

SmashBrawlerBoy
SmashBrawlerBoy

Cool. Some perks of virtual copies are: you can bring them to your friend's houses; you can sell them when you're finished with them; you can store them externally when you are not using them so they don't take up harddrive memory; you can go to exciting midnight releases; you can examine the case thouroughly on the car ride home so excited to play you can't wait; you can store a manuel in the case... wait. No you can't. You can have instant gratification though (as instant as a 4 hour download it.) Who needs patience, anyway? If things were digital at first, hard copies would be the next big thing. Hard copies are best for multiple reasons, and we don't have to change the standard format just to gather attention. If it ain't broken don't fix it. And it ain't broken.

zidan4000
zidan4000

I study business ,and one of our teachers said in his lecture "Analysts are not gods , they can't predict the future , all what they make are pure assumptions from the past" meaning whatever they predict is only because of the past experiences and the numbers are mere assumptions.

warhawk-geeby
warhawk-geeby

Yeah I'd say he's right.. Doesn't mean I want him to be right though. I much prefer visiting a shop :(

RockySquirrel
RockySquirrel

By 2016, the Republicans will have destroyed middle-class America, or do only rich people buy games? :(

steelmouth
steelmouth

i for one gonna stick to retail until they completely abandon it,am never buying any online ish,thank you very much but i prefare my physical stack of discs so i brag they stand taller than most of yah

AuronAXE
AuronAXE

Unless we hit a Video Game Crash that is. Things today are looking like they did in the early 80's. Eventually all these rehashed/reskinned games on every console are going to bite the butts of all these major companies when we gamers get bored and they fail to adjust.

MJ12-Conspiracy
MJ12-Conspiracy

With a crappy economy and still too many people out of work and a new console generation incoming this prediction won't come true. Assuming anyone can afford the next consoles the games will probably be around $80 just because they are "Next Gen". Sorry to be a downer but that's how I see it.

MW2ismygame
MW2ismygame

oh my, please excuse me i must count the dust particles on my keyboard :roll: analyst my foot

demondogx
demondogx

my analyst of today is clouds seem fluffy but when youre standing on the ground you cant reach them now my analyst was just as usefull as theres so can i get payed now ?

emperiox
emperiox

Oh thank god, now we don't have to hear about companies whining about used games hurting the industry right? Ya, like they'll ever give that up...

fillup0
fillup0

Breaking news! People with too much money point out the obvious!

DeadrisingX1
DeadrisingX1

[This message was deleted at the request of the original poster]

Henrique2324
Henrique2324

And not a single **** was given that day.

beuneus12
beuneus12

tired of these "analyst" articles...

raahsnavj
raahsnavj

"We expect a slow, steady decline for physical game sales, with a steady increase for online delivery of games and new business models such as subscriptions and virtual item sales." In that case I predict my involvement with playing Games to have a slow steady decline over the next few years while subscriptions and virtual items sales take off with a different demographic.

dstv
dstv

Analysts >_>

torbonator
torbonator

hmmmm, I prefer hard copies of my purchases, if I don't have something to hold and collector editions to admire I don't feel I have really got anything for my money, and I don't actually 'own' it. Like I have games on steam, if steam ever went bust..... where are my games then? I feel like they hold the cards they could bring in a term or condition in the future where they could stop you from accessing your account and games, if you have done something they don't like (not saying they will, just that is a possibility) The only way I would to digital games if the prices were dramatically cheaper, such as the games I bought on steam through the steam sale

Mkherkzen
Mkherkzen

@ Colbert It's not about stating what we all know, but about giving specific numbers - it's good to hear the industry will grow as much as 20% despite the financial turmoil. Still, I'm not a fan of digital copies, because I like to have my games like books - on shelves, where I can pick them up and feel that I have something, like physically ;P

X_Colbert_X
X_Colbert_X

Really now? Digital distribution revenue is going up while retail distribution is going down? How unexpected! Glad to see people getting paid to state the obvious! /sarcasm