Global game biz to pull in $58 billion

Informa Telecoms & Media this week came out with its Dynamics of Games industry report. In it, researchers see runaway growth for the game industry, powered mostly by strong console sales, mobile gaming, and a robust market created by greater penetration of high-speed connectivity.

Overall, the firm sees the worldwide computer and video game industry selling (and renting) $58.4 billion worth of goods in 2007.

Leading the pack by percentage growth is the mobile gaming sector. Tallying a meager $81 million in 2000 and spiking to $2.5 billion this year, mobile game revenues are expected to grow to $11.1 billion in 2007.

The broadband gaming market is another growth sector. Alastair Nash, the report's coauthor said, "The broadband sector is being assisted by fast growth from Xbox Live!, and, to a lesser extent, PS2 online. The launch of next generation machines will provide another boost for online games and help the market to settle on its most effective revenue model."

The research firm sees growth and breakout by category as follows:

2000 value, 2005 value, 2010 value (in millions)

Console Hardware - $4,791, $3,894, $5,771
Console Software* - $9,451, $13,055, $17,164
Handheld Hardware - $1,945, $3,855, $1,715
Handheld Software* - $2,872, $4,829, $3,113
PC Software* - $5,077, $4,313, $2,955
Broadband - $70, $1,944, $6,352
Interactive TV - $81, $786, $3,037
Mobile - $65, $2,572, $11,186

Total $24,352, $35,248, $51,292
* = includes sales and rentals

In spite of the growth, the report's authors still say "some issues [need] to be tackled. ... Broadband games are doing well but will gain at the expense of the PC market which is in irreversible decline. The Interactive TV sector is still looking for a business model and there is also the issue of piracy to consider."

The one area where growth might not be as welcome is piracy. Unfortunately, Informa says the industry can expect to lose $6.6 billion in revenues to piracy in 2005 and, if unchecked, more than $9 billion in 2010.