Business Report

Games' Scoreboard

Some of the numbers that show how the electronic games industry is changing.

Once, playing computer games required some forethought and effort: you had to go to a video arcade, purchase a game console, or buy and install software for a personal computer. But with the advent of mobile devices such as smart phones and the rise of social websites, choosing and playing a game is a matter of just a few clicks or taps. The result has been a significant uptick in the number of hours people spend playing games, as reflected in the most recent figures available from the U.S. Census Bureau.

The types of games that people are playing have shifted as well. In the past, for example, online gaming often meant the high-tech gladiatorial combat of so-called first-person shooter games or the elaborate fantasy or science fiction settings of massively multiplayer online role-playing games. Now, it is much more likely to involve challenging a friend to Scrabble or matching wits with the computer in a relatively simple puzzle. These are “casual games”–games that don’t require much effort to learn and can be enjoyed a few spare minutes at a time.

Games are also extremely popular on mobile devices, where people spend almost as much time playing games than using all other kinds of apps combined.

Game developers can make money selling games (premium games) or by making games free to play and then selling ad space or charging players for extras such as additional game levels or special items for their characters (“freemium” games). These in-game purchases now generate more revenue than traditional sales of premium games in the mobile market.

Males spend an average of $15.60 per in-game transaction, and females spend $11.90. While the size of these transactions is considerably less than, say, the typical $50 to $60 price of a premium PC or console title, the large user base (which can be in the tens of millions for popular freemium games like FarmVille) and the possibility of repeat sales make for an attractive business model.

See the rest of our Business Impact report on The Business of Games.

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The Business of Games

Long a multibillion-dollar industry in their own right, video and computer games are now affecting a broad range of businesses. The appetites of game players are driving social and mobile technologies. Games are being used to train and manage employees, as well as to encourage customer loyalty and reduce health-care costs.

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