Home Console Market To Reach $46 Billion By 2018, According To Report
The gaming industry is a mammoth one and it's already a multi-billion dollar market that countless studios, marketers, publishers, developers, designers and advertisers are trying to cash-in on in any way that they can. According to a new forecast from IBISWorld Media, the import and export sector for home consoles will reach $46.4 billion by 2018.
The information roll out looks at a number of different factors, including social marketing, security and, of course, profitability. The article notes that...
“Imports, largely dominated by hardware from low labor cost countries, are expected to continue increasing at a faster 6.5% annual rate over the next five years, accounting for $16.8 billion in 2018. Exports are expected to increase at a rate of about 6.4% to $8.9 billion by 2018, with major design offices from the vast majority of the world's largest software developers based in the United States. By 2018, industry revenue is anticipated to reach $46.4 billion, representing an average annual growth rate of 3.9% over the coming five-year period.”
According to the IBISWorld report, a lot of the revenue will also stream from outside of games... yep, if you were thinking TV, TV, TV, sports TV, you aren't far off. Digital streaming services offered from Netflix and Amazon are keen culprits for usage from gamers and non-gamers alike. The report states...
“Per capita disposable income is a driving force behind the Video Games industry’s revenue. In the five years to 2013, per capita disposable income decreased at an annualized rate of 0.2%.
This is nothing particularly new, as we've known for quite some time that a lot of casuals who adopted seventh generation consoles used them primarily for non-gaming related activities, from browsing the web to watching television to streaming movies or just party-chatting with friends (on the Xbox 360).
However, it should be noted that we shouldn't look at the established install base of the PS3, Wii or Xbox 360 as a guideline for the early roll out of the eighth generation home consoles. Majority of casuals are counting dollar bills and only hardcore adopters will be launch buyers. We won't know what the casual adoption rate is like until the holiday season of 2014.
For instance, the Wii U had a strong start (identical to the Xbox One and PS4) but the explosive sales died down after the core gamers picked up a launch console. The casuals were, and have been, slow to adopt.
I can definitely say for sure that the eighth gen, despite its ups and downs, has been one of the most interesting console generations so far. If the casual adoption rate is slow, however, I'm curious to know how Sony and Microsoft will try to leverage their market positions when the first few years may see them only competing for the dollar-dollar bills of the hardcore market.
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