US online revenue will treble to $583m in 2007 says report

A new study from US analyst firm IDC claims that online revenue is set to treble by the end of the year to reach $583 million in North America, and that online revenues are growing faster than any other sector within the global games industry.

The main growth driver is said to be Xbox Live subscriptions, downloadable content and in-game advertising.

IDC’s Billy Pidgeon commented: “By the end of 2007, over 31 per cent of online capable videogame consoles in North America will be in active online use by 14 million online console gamers.

“In North America alone, online console revenue will triple from $133 million in 2006 to $583 million in 2007.”

He broke the rise down as follows: "In 2007, game-related downloadable content derived from manufacturers’ proprietary online console networks will reach $296 million, while subscription revenue will increase from $107 million in 2006 to $277 million.

“While software sales are still significant, increasing from $8 billion in 2006 to $9.5 billion this year, content sold, accessed or downloaded online to videogame consoles over manufacturers’ proprietary networks will remain the industry’s most exciting growth opportunity in this hardware cycle,” he added.

The report also profiled games consumers, breaking the audience into five categories: core, status, social, active and casual gamers. Status Gamers, who are proud of their skills and are early-adopters, spent around $300 in the past six months, said the report. At the opposite end of the spectrum, meanwhile, Casual Gamers spent just $82.20 on average over the same time period and view games as a secondary form of entertainment.