NPD has released their data for 2006, and there is a small bright spot: PC games showed a tiny increase. Not much, but better than a decline.
The surge (if we can call it that) was led by the #1 PC game, World Of Warcraft, along with The Sims in its various configurations. Five Sims games placed in the top ten for the year.
Interestingly, most games designed for the “young male demographic” are conspicuously absent from the top ten list. Perhaps some of the bigger publishers should take note of that.
The thing I’m a little bit skeptical of these days with the “declining PC market” (though it’s nice to see it NOT in decline for a change) is all the revenue generated by subscription-based and direct-downloadable games.
Okay. More than a little skeptical. I’m going to call B.S. I think they are only counting boxes. And that’s a severe underestimation of the total PC market.
For example: World of Warcraft has something like 6 million subscribers now. Multiply that by $15 (?) a month, which is $180 per year, and that’s over 1 billion dollars ALL BY ITSELF. That’s more than the NPD calculated the ENTIRE PC game industry’s revenues.
Now, I expect that a big portion of the subscriber base (read: CHINA) isn’t paying as much for their subscription as U.S. subscribers. So that number will go down a bit.
The Casual (downloadable) games market made an estimated $713 million last year. That’s ONLY counting the major portals (nobody asked ME to find out how much I made from my site, but I don’t think it would make much of a dent in their numbers). It was predicted to double this year. Now SOME of those numbers figured into their $960 million, as some of those casual game sales were actually purchased at Wal*Mart via traditional channels. But I’d say that counted for less than a third of total revenue.
So it seems that just with WoW and casual games alone, they have misplaced about $2 billion. Throw in all the other “long tail” subscription gaming services, online game revenue (a lot of online games are moving away from the subscription model and finding other ways of generating cash), and direct “non-casual” direct game downloads, and I expect you’ve got at least another billion in there.
So I think that the NPD has been seeing decline or reduced growth since 2000 or so, when actually the PC game market has been growing STEADILY over the last seven years. It was all just off their radar.
Coyote, quite right, they only counted the boxes. I’m sure if online revenues had been included, the numbers would be better.
On the other hand, it is good to see retail sales up a tad.
A 1% increase isn’t much, but as you said it wasn’t a decline. I think the surge from World of Warcraft was also factor in there only being a slight increase in PC game sales. Since it requires such a time investment, many PC gamers are playing it exclusively where before they would buy a game or two a month.
Coyote, good points. Last year, Vivendi told its stockholders that WoW, all by itself, brought in just shy of one billion dollars in revenue for the company (including box sales). And it’s been estimated that WoW has half the big-name MMORPG subscription market. So an extra uncounted $2b isn’t unreasonable *just* for PC MMOGs.
I did a bit more research on the topic, and posted a more lengthy analysis here.
Heh. I was just doing my round of game sites, Coyote, and read your post. Came here to put up a link to your very thoughtful piece, and see you beat me to it ;)
Why not send the link to NPD? Maybe next time, they’ll count better!
You’re probably in the ballpark, Coyote. Thanks. :)
Scorpia, I doubt the NPD Group would be interested. The purpose of their analysis is to give (physical store) retailers an idea of what’s selling in *their* market. It’s not even intended to be comprehensive or accurate in the big picture sense, IMO.
In that case, Dell, Coyote’s analysis is even more important for presenting a clearer picture of the game market.