Competition in Video Game Consoles
GBA 687
Hong-Chin Chen
Competition in Video Game Consoles: The State of the Battle for Supremacy in 2008 1. What are the strategy-shaping business and economic characteristics of the console segment of the video game industry? What is the industry like?
1-1 Segmentation: The industry was segmented into console hardware, console software (both sales and rentals), handheld hardware, handheld software (both sales and rentals), PC software (both sales and rentals), broadband, interactive TV, and mobile phones.
1-2 Market Size:
Table 1: Size of the Global Video Games Markets, by Sector, 2000, 2003, and 2005, with Projections for 2010 ($ in millions)
| 2000 | 2003 | 2005 | 2010 | Console hardware | $ 4,791 | $6,047 | $3,894 | $5,771 | Console Software (both sales and rentals) | 9,451 | 16,449 | 13,055 | 17,164 | Handheld hardware | 1,945 | 1,501 | 3,855 | 1,715 | Handheld software(both sales and rentals) | 2,872 | 2,238 | 4,829 | 3,113 | PC software (both sales and rentals) | 5,077 | 3,806 | 4,313 | 2,955 | Broadband | 70 | 497 | 1,944 | 6,352 | Interactive TV | 81 | 249 | 786 | 3,037 | Mobile phones | 65 | 587 | 2,572 | 11,186 | | 24,352 | 31,370 | 35,248 | 51,292 |
Source: Informa Telecoms & Media, “Games Market to Score Big in 2007,” press release, October 24, 2005, and “Games Industry Boom Continues,” press release July 24, 2003, both at www.informamedia.com (accessed September 8, 2006).
As we can see the table above, the market size has grown from $24.352 billion in 2000 to $51.292 billion in 2010. In other words, the video game market becomes bigger and bigger.
1-3 Market growth rate
Table 2 Compounded Annual Growth Rates For the Video Game Industry 2000 – 2005 and 2005 – 2010 (projected)
| CAGR (2000-2005) | CAGR (2005-2010) | Console Hardware | -4.1% | 8.2% | Console Software (both sales & rentals) | 6.7% | 5.6% | Handheld hardware | 14.7% | -14.96% | Handheld software (both
Hong-Chin Chen
Competition in Video Game Consoles: The State of the Battle for Supremacy in 2008 1. What are the strategy-shaping business and economic characteristics of the console segment of the video game industry? What is the industry like?
1-1 Segmentation: The industry was segmented into console hardware, console software (both sales and rentals), handheld hardware, handheld software (both sales and rentals), PC software (both sales and rentals), broadband, interactive TV, and mobile phones.
1-2 Market Size:
Table 1: Size of the Global Video Games Markets, by Sector, 2000, 2003, and 2005, with Projections for 2010 ($ in millions)
| 2000 | 2003 | 2005 | 2010 | Console hardware | $ 4,791 | $6,047 | $3,894 | $5,771 | Console Software (both sales and rentals) | 9,451 | 16,449 | 13,055 | 17,164 | Handheld hardware | 1,945 | 1,501 | 3,855 | 1,715 | Handheld software(both sales and rentals) | 2,872 | 2,238 | 4,829 | 3,113 | PC software (both sales and rentals) | 5,077 | 3,806 | 4,313 | 2,955 | Broadband | 70 | 497 | 1,944 | 6,352 | Interactive TV | 81 | 249 | 786 | 3,037 | Mobile phones | 65 | 587 | 2,572 | 11,186 | | 24,352 | 31,370 | 35,248 | 51,292 |
Source: Informa Telecoms & Media, “Games Market to Score Big in 2007,” press release, October 24, 2005, and “Games Industry Boom Continues,” press release July 24, 2003, both at www.informamedia.com (accessed September 8, 2006).
As we can see the table above, the market size has grown from $24.352 billion in 2000 to $51.292 billion in 2010. In other words, the video game market becomes bigger and bigger.
1-3 Market growth rate
Table 2 Compounded Annual Growth Rates For the Video Game Industry 2000 – 2005 and 2005 – 2010 (projected)
| CAGR (2000-2005) | CAGR (2005-2010) | Console Hardware | -4.1% | 8.2% | Console Software (both sales & rentals) | 6.7% | 5.6% | Handheld hardware | 14.7% | -14.96% | Handheld software (both