Eighth-Generation Consoles are Reenergizing the Video Game Market, Shows New CEA Gaming Study

  Eighth-Generation Consoles are Reenergizing the Video Game Market, Shows New
  CEA Gaming Study

 Portable connected devices are increasingly becoming primary gaming devices

   Wholesale revenue for home video game consoles predicted to increase 85
                               percent in 2014

Business Wire

ARLINGTON, Va. -- June 12, 2014

Consumer excitement surrounding the eighth-generation home gaming console
releases has reenergized the gaming market, according to the latest research
released today by the Consumer Electronics Association (CEA)^®, driving a
projected 85 percent increase in wholesale revenue for home video game
consoles in 2014. The study, The Future of Gaming, gauges consumer behaviors
regarding ownership, device use, gamer segments, video game attachment rates,
purchase intent and more.

Gaming Ownership

For ownership of traditional gaming hardware, seventh-generation consoles
still lead the way. Ownership among online U.S. consumers is highest for the
Nintendo Wii (35 percent), Microsoft Xbox 360 (29 percent) and Sony
PlayStation 3 (24 percent).

Since their debut in 2013, the new eighth-generation consoles are quickly
gaining steam in terms of ownership. The Sony PlayStation 4 and Microsoft Xbox
One are now owned by 11 percent and eight percent, respectively, of online
consumers.

While more than half of gamers (54 percent) learn the most about games from
friends, family and co-workers, a third say they also pay attention to
retailer websites (33 percent), TV commercials (31 percent) and gaming news
websites (30 percent). Consumers also prefer to shop for video games primarily
in brick-and-mortar locations: mass merchants (36 percent), general
electronics stores (32 percent) and specialty electronics stores (32 percent).
A third (31 percent) of consumers also shop for video games online.

Primary Gaming Devices

Portable connected devices are now primary gaming devices for many consumers. 
According to CEA’s 16^th Annual CE Ownership and Market Potential Study,
smartphone and tablet ownership rates (64 and 45 percent, respectively) are at
their highest rates in history. One in ten gamers say their primary gaming
device is a smartphone (12 percent) or tablet (nine percent), on par with or
closely following seventh-generation consoles such as the Xbox 360 (16
percent), PlayStation 3 (12 percent) and Wii (10 percent).

Among consumers who stated their primary gaming device is a smartphone, the
most common operating system is Android (51 percent), followed by iOS (41
percent) and Windows Phone (six percent).

“The gaming industry has been abuzz for months with sizzling sales figures for
the eighth-generation consoles, as well as record-breaking releases of games,”
said Kevin Tillmann, senior research analyst, CEA. “Rather than simply
competing with one another, the eighth-generation consoles are driving gaming
sales and enthusiasm across the board. The industry remains a two-headed beast
– comprised of traditional game consoles and portable connected devices like
smartphones and tablets – but it is certainly stronger than ever.”

Games: Physical and Digital

According to gamers, their purchase choices most often come down to the
quality of games (89 percent) on the system or device. Other common reasons
gamers flock to a specific device include the price of games (79 percent),
ease-of-use (77 percent), price of system (76 percent) and graphics (75
percent).

In terms of the amount of games owned per primary gaming device, the
attachment rates are highest for the Sony PSP, followed by gaming PCs and the
Xbox 360. Most of these products have been in the marketplace for a
significantly longer amount of time than the Xbox One and PlayStation 4, but
both of those new consoles are showing strong attachment rates, especially
with digital games, so early in their product lifecycles. The PlayStation 4
digital download attachment rate is 57 percent of physical discs (compared to
42 percent for PlayStation 3) and for Xbox One it is 62 percent (compared to
37 percent for Xbox 360).

Enhancing the Gameplay Experience: Companion Products

More than half  of gamers (55 percent) indicate they purchased at least one
other companion product to improve the gameplay on their primary device.  The
most common purchases include a television (35 percent) and rechargeable
batteries  (13 percent).

Gaming Market Overview

According to CEA’s U.S. Consumer Electronics Sales and Forecast Study:

  *Home video game consoles: Wholesale revenue is predicted to reach 5.2
    billion USD in 2014, an increase of 85 percent over 2013. An additional 12
    percent growth is projected in 2015, as the surge of home console sales in
    2014 stabilize.
  *Portable consoles: CEA projects total portable console wholesale revenue
    of 506 million USD in 2014, a seven percent increase over 2013. However,
    wholesale revenue is expected to fall slightly to 471 million USD in 2015,
    a seven percent decrease, as the portable console market faces continuous
    pressure from portable connected devices, such as smartphones and tablets.
  *Video game software: CEA projects 13.6 billion USD in revenue for 2014, an
    increase of 9 percent over 2013, due in part to attachment rates for new
    consoles. Additionally, revenue for 2015 is projected to be 14.4 billion
    USD, an increase of six percent over 2014.

The Future of Gaming was designed and formulated by CEA Market Research, the
most comprehensive source of sales data, forecasts, consumer research and
historical trends for the consumer electronics industry. Please cite any
information to the Consumer Electronics Association (CEA). The complete study
is available at no cost to CEA member companies at members.CE.org. Non-members
may purchase the study at the CEA store.

About CEA:

The Consumer Electronics Association (CEA) is the technology trade association
representing the $208 billion U.S. consumer electronics industry. More than
2,000 companies enjoy the benefits of CEA membership, including legislative
advocacy, market research, technical training and education, industry
promotion, standards development and the fostering of business and strategic
relationships.CEA also owns and produces the International CES – The Global
Stage for Innovation. All profits from CES are reinvested into CEA’s industry
services.Find CEA online at www.CE.org, www.DeclareInnovation.com and through
social media.

UPCOMING EVENTS

  *CES Unveiled Warsaw
    June 17, 2014, Warsaw, Poland
  *CE Week
    June 23-27, 2014, New York, NY

       *CE Week Exhibits
         June 25-26, 2014, New York, NY

  *CEA Innovate!
    Sept. 30-Oct. 2, 2014, Phoenix, AZ
  *CES Unveiled Paris
    October 22, 2014, Paris, France
  *CE Hall of Fame Dinner
    November 10, 2014, New York, NY
  *CES Unveiled New York
    November 11, 2014, New York, NY
  *CES Unveiled Las Vegas
    January 4, 2015, Las Vegas, NV
  *2015 International CES
    January 6-9, 2015, Las Vegas, NV

Contact:

Consumer Electronics Association (CEA)
Danielle Cassagnol, 703-907-5253
dcassagnol@CE.org
www.CE.org
or
Tyler Suiters, 703-907-7654
tsuiters@CE.org
 
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