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Global gaming market cap passes $100 billion - Analyst

Avista Parners' Paul Heydon ranks Nintendo as most valuable public game company as part of UK's Edinburgh Interactive conference.

The gaming industry may have experienced a down year in 2009, but the global market remains a strong one. In May, DFC Intelligence estimated that the total market achieved revenues of $60.4 billion, a figure that spans console, PC, portable, and online games, from boxed products and subscription fees to microtransactions.

The gaming pie continues to grow.

The gaming pie continues to grow.

Given those heady revenues, it comes as no surprise that the companies that make those games are quite valuable. Avista Parners investment banker Paul Heydon detailed the value of the global game industry as part of a session at the Edinburgh Interactive conference in the UK this week. According to Heydon, the total market capitalization of all public game companies stands between $100 billion to $105 billion.

Market capitalization, which is commonly used by investors to determine the value of a company, is the sum value of a company's outstanding shares, and so it fluctuates significantly with stock price.

Heydon's figures indicated that current-generation console and handheld leader Nintendo is the most valuable public gaming company, with a market capitalization of $34.9 billion. However, from there, Heydon's figures took on less differentiation, with the investment banker noting that "PC/Console" companies excluding Nintendo combined for a market cap of $33.2 billion.

The online game arena, which includes companies who specialize in massively multiplayer gaming and social/casual titles, is valued at $23.4 billion, according to Heydon, while mobile game companies are worth $8.26 billion. Turning to the fractional portions of Heydon's chart, retail companies' values clocked in at $3.11 billion, followed by payment services ($1.37 billion), distribution/accessories ($311 million), and outsourcing ($255 million).

41 Comments

  • syam32245340

    Posted Jul 3, 2011 7:28 am GMT

    holy crap

  • bildudeaka

    Posted Aug 31, 2010 4:50 pm GMT

    Im shocked to see the nintendo figures seem a bit too "high" anyway its nice to see the gaming industry rapidly advancing threw the years to become the biggest form of entertainment, i still remember the days explaining to my dad what sonic was.

  • Schubatis1

    Posted Aug 31, 2010 9:03 am GMT

    A big disclaimer should be included with this article: a lot of these numbers are either estimates or don't include non-tangible numbers. This potentially inflates Nintendo's numbers.

    First of all, this article only includes publicly traded companies. Privately held companies (for example: Bethesda, PopCap and Zynga) would not be included in this estimate. This actually makes the gaming industry look smaller than it is by downplaying the role of private companies. It also inflates the role of public companies.

    Second, many publicly held companies involved in gaming are also involved in other activities besides games. Microsoft has a market cap of $204.83 billion as of this morning. This number includes its Xbox division, but also includes Windows, Office, Enterprise, and Bing. There is no market cap for Xbox by itself. This means that the authors of this analysis either had to exclude the value of Xbox, PlayStation, and other conglomerates, or had to make rough estimates. Either way, their value for "PC/Console w/o Nintendo" is wrong.

    If "PC/Console w/o Nintendo" doesn't include Xbox and PlayStation, I suspect that most of that value comes from publicly traded companies like EA and Capcom that deal exclusively in gaming.

    Finally, Nintendo has a vertical monopoly over the production of its most popular franchises. Nintendo handles software development and publishing, console development and production, and now even distribution through WiiWare / Virtual Console. For most popular games on Xbox/PlayStation/PC, there are at least two or three companies involved in bringing the game to market (how many games can you think of developed by Intel?). This means that individual companies get a smaller piece of the non-Nintendo pie not becuase they aren't doing as good a job as Nintendo, but because they are doing less work.

  • Feryraiser

    Posted Aug 31, 2010 8:04 am GMT

    @eMEDzZE3RO
    We'll I play all sorts og games too, pc, 360,ds,wii, I jsut don't use my wii a lot apart from brawl RB2 galxay metroid, etc although non hardcore games are good to, except when published by 3rd parties well at least some are.

  • MEDzZ3RO

    Posted Aug 31, 2010 2:36 am GMT

    @Feryraiser
    Oh right,I don't blame you.I'm more of a Killzone,Resistance,Bad Company and MAG person myself,I play most games so I don't have to deal with some of the issues you only find on CoD.The upcoming MoH is a great alternative having played the beta and with Dice working on Multiplayer,you can't go wrong.

  • anthonycg

    Posted Aug 30, 2010 11:03 pm GMT

    It is understandable that this strategy might rub hardcore wii players the wrong way and I think this is Nintendo's only need for improvement. If they can make a few new mascots like Mario and make some good ol' adventure games they'll be even stronger.

  • anthonycg

    Posted Aug 30, 2010 10:48 pm GMT

    I'm not a loser so I won't rail on a console that I don't have. Wii games for the most part are easier for non-gamers to get into thus they will have high numbers and have had them since day one. Gamers are a big percentage of the world. Non-gamers - the rest of the world. With easy controls and simple rules most of the games are quick easy fun that don't take practice to actually understand and can still provide real challenges for the players. The neighbors that have never even touched a video game can get into it fairly quickly. Have you ever heard of a wii party? It's when you invite a bunch of people over to play games on your wii. Yes it's an actual term now. Do not forget that Sony and Microsoft have given the finger to good ol' mutiplayer with friends and moved on to online only which has alienated many people including myself. Chances are you'll have fun with the wii and you won't get beat by some guy that sits at home and plays all day. It's a harsh reality but it's there and the wii gets rid of that. That's why it has been so successful. By acknowledging that gamers aren't the only people that want to play games, a door is open to an immense amount of people that wouldn't think of video games otherwise. It's a simple thought that has led to nothing but success for Nintendo ever since 1975. It is just plain stupid to count out a company with that much history.

  • Feryraiser

    Posted Aug 30, 2010 7:59 pm GMT

    @MEDzZ3RO Well I know it does have hardcore games the fact is they don't come out as often and spread out as other systems games do. I know there trying to do that this year but other than that meh. I do agree with u on mario and tri, as metroid and maybe on re... not a big fan of COD more like a halo dude...

  • MEDzZ3RO

    Posted Aug 30, 2010 5:31 pm GMT

    @Feryraiser
    It has a couple good games: Monster Hunter Tri,Twilight Princess,CoD reflex,The Conduit,Red Steel 2,Super Smash Bros. Brawl,Mario Galaxy,Metroid Other M,Resident Evil 4 and Metroid PrimeTrilogy.
    Granted most aren't hardcore, I'd say Metroid Prime,Resident Evil and Tri are.

  • Feryraiser

    Posted Aug 29, 2010 7:04 pm GMT

    Sigh sometimes I wish the wii had more hardcore games and screw the pallities

  • fmacraze

    Posted Aug 29, 2010 2:05 pm GMT

    well congrats nintendo.

  • gamer_seb

    Posted Aug 29, 2010 5:25 am GMT

    The wii has both hardcore and casual games but casual games dominate of hardcore

  • BloodMist

    Posted Aug 27, 2010 10:10 pm GMT

    @ SirMordredX

    You, and most people, try to make it sound like the actual amount of truly excellent games on the other platforms is exponentially higher than on the Wii.Which is simply, a bunch of crap.99 percent of the games that are released on every platform are mediocre to junk, and the actual amount of games of TRUE, top tier quality are only a few per year, on every platform.That's the reality of the situation, and to say any different is to have an unrealistic bias.Bottom line.

  • Gamingclone

    Posted Aug 27, 2010 7:11 pm GMT

    @snarl2

    Look at the chart closely, you'll see that right next to nintendo's piece of the pie chart, there is another piece, a bit smaller than Nintendo's piece, that says "PC/ Console w/o Nintendo $33,223" (w/o standing for 'with out'). That piece includes the xbox 360, PS3, and PC (pc games) which are all combined to create this $33,223 value.

  • zar144

    Posted Aug 27, 2010 3:07 pm GMT

    Perhaps this may be just another random opinion... but regardless of who sells more or who dosen't, if the game industry begins to grow bigger and bigger, people will realize that games aren't just a way to make money or a simple hobby. And they will realize what they really are... art.

  • somberfox

    Posted Aug 27, 2010 2:50 pm GMT

    @ scorpgul
    Last I heard, the average age of gamers is over 30 so that's nowhere near accurate.

  • mario-nin-freak

    Posted Aug 27, 2010 2:38 pm GMT

    @MuffintopX Nintendo isn't making hardcore gamers There making casual gamers people get used to a genre and don't change very often. The reason Nintendo is ahead is because they get younger kids, your right on that. But not your reason, once nintendo has them buying there stuff they rarely change over to another company.

  • mario-nin-freak

    Posted Aug 27, 2010 2:35 pm GMT

    strange, nintendo has more sales than sony and microsoft combined. Microsoft and sony need to realise that until they reach all ages they will always be on bottom(or atleast a little below nintendo).

  • Flint247

    Posted Aug 27, 2010 1:24 pm GMT

    I like Nintendo's work, but honestly, I don't care who is succeeding or not right now, as long as I get to play the games I like, that's all I care for. We debate day or night over "hardcore games vs. casual games" garbage, but in the end, video games in general is what should matter. No need to put one self over the other based on what game you are playing. We all have different interest and we are ALL gamers.

  • SirMordredX

    Posted Aug 27, 2010 12:38 pm GMT

    @RockySquirrel Well...as a general direction it is meant for younger or family audieces - not necessarily by the developers but by the publishers and Nintendo itself. I don't have a Nintendo simply because there are too few adult-specific [read my entry on adult games, I don't mean blood, gore and strip joints] games on it. In other words, too few "Real" deep, serious and mature games like the Witcher, Heavy Rain ETC.

    That doesn't make it bad, it's just for a different kind of audience.

  • scorpgul

    Posted Aug 27, 2010 12:32 pm GMT

    Video games=75% kids thats why Nintendo always crushes competition some people havent figured that out yet sure a few old nerds play games as well but thats how it is

  • RockySquirrel

    Posted Aug 27, 2010 11:40 am GMT

    Nintendo just for "kids"?

    I don't see how a FPS couch-potato or an MMO addiction or panting at half-dressed virtual women makes you more "hardcore" or more "adult" than the fans of Nintendo who enjoy the amazing creativity behind the Wii's best games.

    Maybe "age" is in the mind of the gamer...

    (makes a rude "adult" gesture)

  • MuffintopX

    Posted Aug 27, 2010 10:02 am GMT

    It is a fact that Nintendo targets the child audience, and that is great. They are shaping young minds to love video games for their entire lives, the only way to plant the seed is with games that mature players have no interest in. As we get older, PS3 and 360 are what we grow into, but I have to applaud Nintendo and their lack of hardcore games for programming the future consumers of the hardcore game market. Nintendo kids today will drive the MS and Sony markets of the future so we will all see bigger and better things as soon as they are old enough to spend money!

  • Moloch121

    Posted Aug 27, 2010 9:23 am GMT

    Why are people cheering for Nintendo? They still don't release games for the hardcore or atleast for the non-casual people. As much as I love Mario and Zelda I can't keep playing the SAME STORY forever. As good looking as Mario and Zelda don't support High Definition. If Nintendo is such a big force in the gaming community couldn't they start working on releasing a Wii HD or something with a real hard drive? Nintendo has the money to do anything they can't keep coming up with excuses yet the consumers just keep[ gobbling it up. Say what you want about PS3 or Xbox 360 but atleast you get the quality you pay for and with the kinetic and move coming out soon I hope it makes a HUGE dent in Wii hardware and software sales. But still my PC forever!

  • gbrading Site moderator

    Posted Aug 27, 2010 9:07 am GMT

    That pie chart is fascinating viewing at how the percentages break down.

  • SlickkWilly

    Posted Aug 27, 2010 7:17 am GMT

    Nin will give you a handful of good games for a spoonybard, green-dominator, or a slickkwilly a year, but after that there focus seems to be to make money. A very intelligent marketing plan and targeting a different consumer makes them alot of money and that is what it is about for them. I wouldn't expect them to change anytime soon. This is good business,not to be confused with providing a great product for you specifically and they really are at a point where it is hard to compare them to other gaming companies. They have a completely different target audience and attitude towards progress, which does appear to favor the younger market or of parents buying toys for their children. Businesses can remain successful by adjusting to go where the money is and not staying committed to what has been important in the past. Unfortunately, to gamers that care about advancement and quality of games, this stings a bit. These companies are not in the same category any more.

    Microsoft and Sony appear to challenge themselves with cutting edge technology without worry of cost. This will always provide a better high end product, but it will not always make the most money, especially when people don't have much right now. But, hats off to them as well for continuing the technology drive of our games.

  • SlickkWilly

    Posted Aug 27, 2010 7:17 am GMT

    I'll keep the wii around for the marios and the zeldas and when my nephew wants some ridiculous little game for christmas, I will get it for him. For my main enjoyment, I will buy ps3 and 360 games, because I appreciate the abundance of quality titles on those systems. Good news remains that we have tons of options here.

    game on.

  • RockySquirrel

    Posted Aug 27, 2010 7:16 am GMT

    Wa-Hoooo!

    The gaming world is a much better place thanks to Mario... and the creative minds at Nintendo.

    Super Mario Galaxeeeeeeee!

  • asimplerapper

    Posted Aug 27, 2010 7:12 am GMT

    Let's all keep lifting this industry higher and higher where it deserves to be.

  • 2bitSmOkEy

    Posted Aug 27, 2010 3:13 am GMT

    I knew Nintendo was the big dog this generation but I didn't know they were THAT huge. Further proof that depth will never outsell accessibility or hype no matter what medium is in question.

  • somberfox

    Posted Aug 26, 2010 10:46 pm GMT

    Not surprising considering Nintendo doesn't target the gamer demographic anymore. I wonder what the pie chart would've looked like last gen.

  • snarl2

    Posted Aug 26, 2010 9:35 pm GMT

    Wheres PlayStation and Xbox on the pie?

  • green_dominator

    Posted Aug 26, 2010 8:40 pm GMT

    I must be the 1% of people who've given up on Nintendo. I don'y say that to be mean or hateful it's just I came from the age where Nintendo dominated the industry and currently I feel more like I've been forgotten by them, so be it I say....
    I like XBOX 360 and PS3 better anyways.......

  • Lightchaos-20693173927190915074555969291770

    Posted Aug 26, 2010 8:23 pm GMT

    This is good news, that means we will get more games.

  • Gamingclone

    Posted Aug 26, 2010 8:22 pm GMT

    Looks like Nintendo makes the best business choices, which only means one thing. All businesses about to fail should take lessons from Nintendo on how not to fail I'd like to see a chart of which company spends the most money on making games.

  • chapnapprogamer

    Posted Aug 26, 2010 8:18 pm GMT

    i guess nintendo loves eating a big pie

  • Pr0ving4Gr0undz

    Posted Aug 26, 2010 7:37 pm GMT

    damn Nintendo lol

  • hannify posted Aug 26, 2010 6:30 pm GMT (does not meet display criteria. sign in to show)

    hannify

    Posted Aug 26, 2010 6:30 pm GMT (hide)

    Big 'N' we salute you

  • AnelZukic

    Posted Aug 26, 2010 5:52 pm GMT

    and then people ask why making mobile games, and what's the fuss about every game having online, even singleplayer one and I'm surprised to see that Nintendo takes so much of the pie, I mean more then the other consoles and PC alltogether but they made the best business choices in the recent year, so I just can applaud them

  • P8rt

    Posted Aug 26, 2010 4:30 pm GMT

    Is this the same gaming industry that "needs" to start triple charging consumers for online play?

  • BloodMist

    Posted Aug 26, 2010 4:22 pm GMT

    For better or worse, gaming is a true phenomenon now, yes indeed.

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