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The Almighty Buck Media Music Entertainment Games

Videogame Spending May Soon Outweigh Music Spending Globally 56

Posted by Zonk from the i-like-em-both-don't-make-me-decide dept.
Ars Technica reports that, for the first time, spending on videogames is in a position to overtake spending on music worldwide. An analyst report from PricewaterhouseCoopers discussing growth in media shows this being the first year that's a possibility. "The information not only reflects the gaming industry's strong trajectory but also serves as a painful reminder that the music industry continues to suffer. ... The rising penetration of broadband combined with consoles with online capabilities, wireless phones capable of downloading games, and technologically advanced consoles are credited with driving the video game industry's strong growth. PwC says that the gaming industry will see a compound annual growth rate of 9.1 percent between 2007 and 2011, resulting in a $48.9 billion global video game market in 2011, up from $37.5 billion this year."
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Videogame Spending May Soon Outweigh Music Spending Globally More

Videogame Spending May Soon Outweigh Music Spending Globally

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  • I'm surprised it took this long.
  • ...when the quality of videogames keeps going up and the quality of the crap the major music labels tries to cram down your throat keeps going down (as if that was even possible). Besides, buying 1 full price game is equivelant to buying 4 new cds. And as big of a music geek as I am, getting a new videogame is a lot more exciting than getting a new cd. Especially for the masses who can turn on the radio and hear music for free.
    • The quality of video games has been increasing? Since when? It's nothing but boring sequel after boring sequel, and lame franchise-pushing game after lame franchise-pushing game.

      • Re: (Score:3, Interesting)

        by Anonymous Coward
        Hey, I did testing for Ocean, Data East and Lord knows what other shovelware companies back in the late 80s. Back then we got paid for it, too.

        I won't say the quality's gone up, but it hasn't gotten worse.

        Hell, I remember one time, after extensive diplomatic negotiations, I got patched through directly to the lead programmer on a basketball game, to explain to him what constituted 'offsides'. And this was a week from mastering.
      • Truly exceptional game shave always been few and far between. Right now a year there is more good games out a year (numerically) then before. In the past few months we got some very high quality games. Odin Sphere, Etrian Oddissey, puzzle quest and cooking mama are just a few examples of non-sequel games ot have been release recently.

      • Re:Well, that's what you get... (Score:5, Interesting)

        by ben there... ( 946946 ) on Tuesday June 26, 2007 @10:42PM (#19658369) Journal

        The quality of video games has been increasing? Since when? It's nothing but boring sequel after boring sequel, and lame franchise-pushing game after lame franchise-pushing game.

        Fresh out of a Civ4:Warlords game, I'd have to disagree. That expansion pack improved Civ4 wars immensely. The upcoming Beyond the Sword expansion looks like it will similarly improve the late game, much more than the typical expansion pack. And Civ4 is the best Civ sequel by leaps and bounds. It's the 12th most highly rated game on metacritic [metacritic.com] for PC. It's definitely just about the best turn-based strategy game ever.

        Other games that have improved upon their predecessors: Morrowind for its story and gameplay, Oblivion for its environment and voice acting. Combined, the two games are the best real-time RPG-ish games ever. Counterstrike: Source took an old game and modernized it. The most popular FPS. In the same genre, BF2 is huge right now. ET: Quake Wars, releasing very soon, will likely be the standard bearer in FPS for a while. Again, much improved upon the ET, RTCW, Wolfenstein, and Quake predecessors. A huge FPS fan, I'll probably be dropping all the other games I mention here to play that one for a few months.

        I recently played a good norwegian adventure game (for its story), called Dreamfall: The Longest Journey. The story, characters , dialog and voice actors, and environment is probably the best I've seen in a game. Again, it is much, much better than TLJ that I went back to try. TLJ is much closer to the roots of adventure point-and-click games like King's Quest, while Dreamfall is 3-D WASD movement and a much better game because of it.

        While not my favorite genre, WoW and Guild Wars have got to be the best MMORPGs ever created. I have little interest in them, but judging by the subscriber numbers and the huge variety of people they've sucked into an online game, they've got to be the best in that genre.

        Heck, I even recently picked up the Tomb Raider: Legends and Tomb Raider: Anniversary games and the controls, graphics, and even story are much richer than the old games.

        Basically every genre of PC games has a huge blockbuster recently released or about to be released. I'm more into trying out different types of games than I've ever been. Perhaps gaming on a next gen console is boring right now with limited numbers of "franchise-pushing sequels", but definitely not PC gaming. Future classics are being created every year. Every game I've mentioned here has a lot more to offer than older games, and have really gotten me back into gaming. I can't wait to see what comes out next, personally.

    • Re: (Score:2, Insightful)

      by morari ( 1080535 )
      Visual quality perhaps (and at what artistic price does so-called "realism" come?). I don't think the ratio of truly great games has changed too much in years past. Remember, complexity does not necessarily denote quality.

      • Re: (Score:1)

        by KDR_11k ( 778916 )
        The ratio of truly great ones, no. But the average quality went upwards I think, the mediocre games of today are better than those of 20 years ago.

  • Countdown (Score:1, Flamebait)

    by UbuntuDupe ( 970646 ) *
    So this means the mainstream media and academia will accept video games as a legitimate artistic medium in 3..2...

    • Re: (Score:3, Insightful)

      by AKAImBatman ( 238306 ) *
      The soft drink industry is a 40 billion dollar a year business [bellybytes.com]. So this means the mainstream media and academia will accept soft drinks as a legitimate culinary art in 3...2...

      (Methinks that profits aren't exactly the best way to be judging artistic merit.)

      • Re: (Score:3, Insightful)

        by UbuntuDupe ( 970646 ) *
        Methinks that video game spending is not the same as video game profits.

        My point was that, as video games make up a larger market (on par with music, in this case), they become harder to trivialize, not that there is some profit/artistic merit threshold. The same thing happened with cinema, which at one point wasn't considered real art.
    • Who really cares what the msm and academia think? They are usually way behind in what is going on in many areas and don't push the edge anyway. The MSM, in particular, let something become safe before touching it. In other words, they are irrevelent.

  • NDOY (Score:4, Insightful)

    by AKAImBatman ( 238306 ) * <akaimbatman AT gmail DOT com> on Tuesday June 26, 2007 @05:51PM (#19655839) Homepage Journal

    resulting in a $48.9 billion global video game market in 2011, up from $37.5 billion this year.

    Nintendo has a market cap of 6.4 trillion yen (51.7 billion dollars) up from 2.7 trillion yen (21.8 billion dollars) this time last year. According to their last financial report, their net sales for last year were 966 billion yen (7.8 billion dollars) up 89% from the previous year's 509 billion yen (4.1 billion dollars) in net sales.

    I think I know where your massive industry growth is sitting...
  • Great, here comes the VIAA. Bend over at the hips, please.

  • Good thing... (Score:4, Insightful)

    by stmfreak ( 230369 ) <[moc.liamg] [ta] [kaerfmts]> on Tuesday June 26, 2007 @06:16PM (#19656151) Journal
    Good thing nobody pirates video games or those guys would be going out of business too!

    Or is this just another case of the data fitting the conclusion in some cases and being suspiciously absent in all other conversation?

    • Re: (Score:3, Interesting)

      by LithiumX ( 717017 )
      It's no secret that copyright violation is always going to be a thorn in the side of all forms of media. The earnings losses will always be exaggerated (and based on the false assumption that every download is equivilant to one lost sale), and media execs who are trying to defend their jobs will gladly roll out the piracy card, but it's been eating away at profits for some time.

      The difference is the dvd and video game industries are ramping up. They suffer just as heavily, if not worse, from piracy due

    • Re: (Score:3, Insightful)

      by moderatorrater ( 1095745 )
      To paraphrase the sibling node, they probably understand the internet a whole lot better and have therefore adapted a lot better to it.

      Battle.Net was one of the first really great integrations of games and the internet. The first (and, really, only) great integration of music and the 'net is iTunes, which is making money hand over fist. But the point is that Battle.Net isn't alone in great online gaming, whereas iTunes is. Add Steam and Gametap on top of that and gaming companies are decades ahead of th

      • Add Steam and Gametap on top of that and gaming companies are decades ahead of the music industry.

        On the other hand you have the people who want to make their games next to impossible to copy. Gaming has done this by releasing consoles that only accept their discs, but it works (nearly) perfectly and gives a hard copy and doesn't restrict the user any more than that. Successful DRM + successful digital integration + successful digital distribute + making a quality product = ridiculous profits. It's that sim

    • Good thing nobody pirates video games or those guys would be going out of business too!

      Fewer people pirate video games than music since most of the revenue is in the console & portable space where it is relatively difficult to pirate. PC games accounted for only $1B [gamedaily.com] vs. $6.5B [gamedaily.com] for console games.

      • Yes, video game piracy is simply harder.

        And unlike music publishers, videogame publishers haven't _had_ to publish non-copyprotected games on plain CDs to cater to a massive installed base of PCs and consoles that cannot do decryption.

        Nor can we 'capture' a video game while playing it by plugging 'video-out' of our PCs into a 'video-in' port; then put it on P2P networks for others to play the 'captured' game for free.

  • That's just because of Piracy (Score:4, Funny)

    by monopole ( 44023 ) on Tuesday June 26, 2007 @06:20PM (#19656193)
    Which costs the music industry $1 Billion per year per person!!! . Once the RIAA can make everyone pay, the music industry will not only exceed the games industry, but the total world economy by several orders of magnitude. It will only be exceeded by the Movie industry which currently loses $2 Billion per year per person!!! due to piracy.
    • I have this feeling that pretty soon they'd realize that the video game industry is in fact losing $3 Billion per year per person!!! You've got to figure in all those casual games that people play while blocking the ads that are supposed to pay for them!

  • The information not only reflects the gaming industry's strong trajectory but also serves as a painful reminder that the music industry continues to suffer.

    The information not only reflects the gaming industry's strong trajectory but also serves as a painful reminder that video games cost ten to twenty dollars more than they did just one generation ago.

    Okay, so that's not the whole story, and they're not all more expensive, but seriously! Games have gone up in price, and while they have gone up in resolut

    • Game prices here in the UK for major big-name release day titles have gone up from maybe £30 to £40 in the last five years - taking the differing exchange rates into account that's a fluctuation from $42 to $80! Perhaps part of the effect you are feeling is your, let's be honest, crashing worthless currency.

      • Perhaps part of the effect you are feeling is your, let's be honest, crashing worthless currency.

        You don't have to be polite when you talk shit about our currency. The whole world will be wiping their asses with it soon enough.

        That's a good point, and one I hadn't considered. It's hard to find out, though, because the terms "price" and "comparison" will "reward" you with a deluge of assholes competing to give you the worst best price on anything. All I know is that adjusted for inflation, the neo-geo is s

        • Up here in canada our games are just as expensive as ever.

          1990 Dragon warrior 2 : $55.00 + tax

          2007 Odin Sphere: $59.95 + tax

          marginal increase due to inflation but otheriwse the same.

          • Re: (Score:1)

            by Krakhan ( 784021 )
            Are you sure? I remember spending over $70 - $110 CDN on game cartridges once upon a time. I think most games here have come down in price overall.

            Dragon Warrior 2 cost around $80 on release here. Where did you manage to get it for such a great price back then? :)

      • Re: (Score:1)

        by Ant P. ( 974313 )
        Five years is nothing.

        Go back ten years, and you have the £70 N64 games, £60 Mega Drive games, etc...

    • Re: (Score:3, Informative)

      by Stormwatch ( 703920 )

      I've only noticed that far more games seem to be coming at a $60 price point now, when $50 was more or less the top of the scale for games that didn't come with their own controller in the previous generation.

      But there was a time when games cost even more. Chrono Trigger and Final Fantasy III (VI) cost around U$80. Virtua Racing cost $100 (it had a built-in co-processor). I'm not sure about Phantasy Star IV, but it was also something close to that.

      • Those expensive games were rare. Most games came at a substantially lower price-point. I will admit that some Atari games were more expensive, but long before the end of that console's lifespan they had altered them to be much more reasonable - and that was a special time, as the Atari was kind of the first mass-market video game console.
      • Mod parent up. This is 100% correct. Back in the day, by which I mean 1980-1994 or so, AAA titles routinely had an MSRP in the range of $80 at release. Competition and mail-order discount stores combined with a larger mass market brought this down to about $40-$50 dollars by around 1996, and there they've stayed until the last couple of years. People just don't remember what games used to cost in the early 90's. There have always been bargain basement, clearance bin, and shovelware titles. But at rele
      • Video games, or just console games?

        I pre-ordered "Overlord" at the weekend, and it was £25 for pc ($50) or £40 for xbox 360 (a massive $80).

        It's the same game!
    • You're forgetting that the increase in resolution and such necessarily involves increasing complexity in design and coding and related assets. Comparitively speaking, the SNES was much easier to put a game together for than next-gen consoles such as the PS3 or even the Wii. This increase in complexity is reinforced by further demands for "better" realism in games. Or did you really think all that power in your consoles came for free?

      Programmer time is not fungible, dammit!
    • PC Games haven't gone up in price. I have a friends that are selling there "next-gen" consoles due to the complete lack of any quality games in between Holiday seasons. PC games last longer, are cheaper, and are released all year long. Anyone who plays consoles only, and is older than 12, is completely missing out on the best gaming experience.
      • Not only that, but PC games hit the bargain bins _much_ faster than they used to. Who needs cutting edge stuff that has you tweaking video drivers and all that crap? I just wait a year and pick 'em up for $10 or less. Of course, I don't usually play 3D games anyway, so high-end performances is rarely a prerequisite. I spend less on games now than 10 years ago, but buy more games.

        With regards to the main topic, between kinesiscd.com, mindawn.com, and emusic.com, I get more music than ever.

    • Re: (Score:3, Insightful)

      by poot_rootbeer ( 188613 )
      video games cost ten to twenty dollars more than they did just one generation ago.

      After having stagnant pricing for 10-15 years. In 1990, a premier console title might cost you $50, and a budget title $25. In 2005, same thing. A price hike was overdue.

      It's worth considering also that the cost of producing a video game has increased. It's cheaper to make a character out of 32x32 pixel art than it is to build a 3D model and textures that look good at every possible size onscreen.

      while they have gone up in
  • The article doesn't specify, but I have to ask, are they talking about game sales plus console sales? How about peripherals? Many new systems were purchased in the past year, with the release of three new major platforms. Should music sales be taking into account iPod and CD player sales?
  • So an $18 CD vs. a $50 - $60 pop for video games.
    • In terms of price growth, game prices have gone up ~20% (50$ to 60$) CD prices are growing at a similar, if not higher, pace (10-12$ to 18-20$). Also, compare the typical CD collection to a game collection. The CD collection will be 4-5x larger due to greater demand for a vast music collection so that you don't tire of the same 20 CDs, whereas 20 games is a significant collection and can be diverse enough to keep you interested -- atleast until the latest and greatest is released. Games are only recently
  • They raise the price on games. They raise the price on game systems. People buy the same amount of crap for more money.

    And we're surprised that the market has produced higher spending numbers?
  • I do truly think this is sad news. The same old fantasy/war adventures set in canned worlds are not as liberating for the human soul as unique music is, whether it be Beethoven, Public Enemy, or Bjork. Well done music is a window into a unique world view, what do I know about the creators of WOW or Doom 4 after playing? Answer is nothing. And no this isn't a Luddite rant I think the internet has brought many positive advancements to humanity, I really like my 20 inch widescreen lcd, ipod, digital camera,

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