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Spending on Game Titles Dropped 2 Percent in 2010

| 20 Dec 2010 19:26
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Videogame consumers in the U.S. spent less money on games (not including consoles) in 2010 than they did in 2009.

Newzoo is a Dutch market research company specializing in the videogame industry. The results of Newzoo's report for 2010 yields some interesting tidbits beyond the 2 percent drop in total spending to $24.7 billion, despite the general economic upturn since the crash of 2008. First off, all retail sales are down, including PC (-19%) and console (-29%) sales, but digital distribution for PC and Mac titles increased by 60 percent to $2.5 billion. Spending on MMOs increased, as did the casual game market and gaming through social platforms like Facebook. The conclusion one can draw seems to be that the traditional business model of retail game stores is waning, with digital distribution and smaller markets the only areas seeing growth.

"The games market is changing at an enormous pace, driven by the simultaneous introduction and uptake of several new game platforms and business models," said Peter Warman from Newzoo. "Mobile and social gaming as well as massively-multiplayer-online-games are enjoying mass-appeal and taking major chunks out of the 'total gamers' wallet.'"

This data seems to contradict what Bobby Kotick recently said regarding Activision not seeing much profit in either social games or casual markets like Apple's App Store. If people are spending less money in brick and mortar game stores, as Newzoo's data suggests, wouldn't it make sense to diversify into different markets instead of betting everything on the next Call of Duty or WoW?

Actually, seeing as MMO income grew 46 percent to $2.7 billion, maybe Kotick should put more stock in Blizzard's Titan MMO.

Source: Newzoo pdf

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