Games Fighting Hard for Shrinking Dollars
LONDON, January 15, 2013
LONDON, January 15, 2013 /PRNewswire/ --
The gaming industry continues to face shifting trends and a fast altering
landscape. Digital and mobile gaming options keep gaining in importance driven
by the ongoing proliferation of smartphones and other mobile devices, as well
as the internet in general. This turbulence poses considerable challenges to
industry players. However, with change comes opportunity and for the companies
that adapt successfully, opportunity abounds. Diversification of revenue
streams through successful franchises is a tact which can help to buoy
revenues, as Activision Blizzard Inc. (NASDAQ:ATVI) has shown with Skylanders.
Talk to our analysts about Activision Blizzard, sign up now for free at
New releases are also essential to maintaining a following and many industry
players, including Electronic Arts Inc. (NASDAQ:EA), Take-Two Interactive
Software Inc. (NASDAQ:TTOW) and Shanda Games Limited (NASDAQ:GAME) seem to
have exciting pipelines planned for 2013. While demand for social and mobile
gaming is booming, companies operating within this realm have their own
challenges, so it will be interesting to see how companies such as Zynga Inc.
(NASDAQ:ZNGA), which recently announced its earnings release date, have fared
in the most recent quarter. See how these gaming companies have performed in
the past year and how they are expected to perform in 2013. Our analysts will
be happy to answer your questions, sign up now for free at
2012 did not end on a high note for video game retail sales. According to NPD
Group figures, December 2012 marked the thirteenth straight month of declines
as sales dropped 22 percent compared to the same period a year earlier. For
the full year, video game sales fell to $13.26 billion, 22 percent lower than
2011 sales of $16.99 billion. "Declines have not been uniform, with
middle-tier games faring the worst, while the top ten titles generated a
whopping 46 percent of December's dollar sales, up 12 percent year-over-year.
Activision Blizzard was on top, with Call o f Duty: Black Ops II being the
top-selling game in 2012, followed by Madden NFL 13 fromElectronic Arts,"
our tech stock expert stated. You can have more details by talking to him
directly today. Sign up now at
Activision Blizzard has also had success with its Skylanders franchise, which
recently crossed the all important $500 million milestone in retail sales.
Skylanders toys were on the "Holiday Hot Toy List", the movie did well over
the holiday season and its release of mobile versions has further boosted its
popularity. This success with the child focused franchise may be especially
well timed as some fear that the shooter gaming market may be in for a bumpy
ride due to negative attention following the tragic Sandy Hook Elementary
School shooting. So far, most members of the gaming industry seem to be trying
hard to be helpful by attending the exploratory meeting organized by Joe
Biden. Nonetheless, others felt that attendance was akin to admitting that
"you were a part of the problem" and thus ill-advised. The issue is
particularly pertinent, as shooter games have proven to be resistant to
competition from cheap or free-to-play mobile games, thus industry players
will not want to see the market disrupted.
There are a number of anticipated new releases slated for this year too.
Electronic Arts recently announced that The Sims 3 University Life and The
Sims 3 Island Paradise Expansion Packs are being developed and are indented
for release throughout the year. Meanwhile, Take-Two Interactive Software has
announced that an agreement has been reached with Major League Baseball, the
Major League Baseball Players Association, and Major League Baseball Advanced
Media to release Major League Baseball® 2K13 .
Elsewhere in the industry, mobile and online game developers are also putting
forth new products. Chinese online game developer, Shanda Games Limited lately
announced that the Korean launch of its iOS version of Diffusion Million
Arthur has catapulted it to top grossing app among all categories in Apple's
local App Store. As a result of this success, the company is now planning to
publish the game in China, Taiwan and Southeast Asia, as well as planning a
mobile version of Final Fantasy I, II and III in China, Taiwan, Korea, and
Southeast Asia in the near future. On the other hand, Zynga, which is
scheduled to report its fourth quarter and full year earnings on February 5th,
has been trimming back its portfolio to focus on games which are performing
well. The company has announced plans to shut down 13 under-performing games
and cut 150 jobs. Zynga is also entering a new relationship with long-time
partner Facebook, which will allow it to make its games available on other
sites, potentially opening up new revenue streams. Get our financial analysis
on Zynga soon, sign up now to receive our alert email.
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