Games sector to expand

14 November 2011

LONDON: The value of the global digital gaming market will rise by over 100% between 2011 and 2016 as more and more people use online and mobile app-based games, according to new forecasts from Ovum.

The UK research firm suggested that the sector will increase from $24bn to $53bn over this period, equivalent to an annual growth rate of around 17%.

An explosion of interest in "casual" games accessed via mobile apps is likely to be the biggest growth driver. These games tend to be cheaper to purchase and simpler to learn than traditional console and PC-based games.

Ovum forecast mobile gaming growth to be twice that of the overall market, with revenues trebling over the five years to 2016 to reach $17.5bn.

Mark Little, an analyst at Ovum, said: "The market is no longer the sole preserve of the teen male hardcore gamer.

"Gaming is fast establishing itself with a much wider mainstream audience, with serious ramifications for other rich-media entertainment such as TV, video and music."

More broadly, Ovum's report suggested that the evolution of gaming towards online and mobile would prove to be a financial boon for the industry.

This is because digital distribution reduces costs and negatively affects the used game market.

Many online games are also free-to-play, increasing opportunities for marketers hoping to produce and sell in-game ads.

Little added: "Game publishers' evolving strategy is turning game products into game services, extending product life with downloadable content that continually refreshes a title's ability to engage the gamer."

Data sourced from Ovum; additional content by Warc staff