PC Gaming Market Up Three Percent in 2009

The PC Gaming Alliance revealed today that total revenues from all aspects of the PC gaming industry in 2009 was actually up by three percent over the previous year, totaling a whopping $13.1 billion.

Conventional wisdom says the PC is a dying platform: Sales are down and major publishers are increasingly focusing on consoles, which rule the roost unopposed. But according to the PC Gaming Alliance, which released its 2009 Horizons Report today, it's not actually dying at all. It's just changing.

No, this isn't some "beautiful butterfly" metaphor. Most analyses of the PC gaming market look exclusively at conventional retail game sales and in that regard, the market is indeed in bad shape: Boxed game sales suffered the biggest downturn of all PC market segments in 2009 and now account for less than 20 percent of total revenues. But the PCGA cast a much wider net for its report, including online gaming, digital distribution and even online advertising, and found that overall, the PC is still a very lucrative platform.

"The most notable trend in recent years has been the movement to digital distribution and payment for subscriptions, and the growing popularity with consumers of online games as a service," said PC Gaming Alliance President Randy Stude. "In 2009 we saw North America and Europe experience a rapid uptake in purchasing virtual items. This model is what drove growth in Asia and we think it is just starting to come to Western markets."

Along with boxed game sales, "high-end subscription" games - those that charge $10 per month or more to play - also experienced a slowdown, but the PCGA said the growth of digital distribution was enough to "largely offset" the losses suffered by established markets. Meanwhile, free-to-play games such as those found on Facebook and other social networks are continuing to grow rapidly, attracting a user base that can be "progressively monetized."

"In our surveys of PC gamers in North America and Europe we found that over 70 percent indicate they have bought a full game online. Furthermore, over 50 percent indicate they have bought a virtual item," noted DFC Intelligence Analyst David Cole. "This is very positive because, when done successfully, companies in Asia have found the digital distribution model to be significantly more profitable than the traditional retail boxed goods business."

Reports of the PC's demise, it would seem, have been greatly exaggerated.