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Analyst: Digital Game Sales 22% Of Market By 2010

With Valve's Steam, Microsoft's XBLA, and similar forthcoming features for both Nintendo and Sony's new consoles, new analysis from market research group eMarketer is predicting a rise in digitally distributed content to 22 percent of total game revenues
With Valve's Steam, Microsoft's Xbox Live Arcade, and similar forthcoming features for both Nintendo and Sony's new consoles, new analysis from market research group eMarketer is predicting a rise in digitally distributed content to 22 percent of total game revenues by 2010. In the latest eMarketer report, "Digital Downloads Only Clear Winner in Console Market," senior analyst James Belcher notes the rise of and increasing breadth of content delivered online to both PCs and consoles as the driving force behind the new prediction. Up from the 8 percent total game revenue that digital downloads provided in 2005, which includes subscriptions, individual game downloads, and updates, eMarketer sees the expansion of the market into "mini-games, expansion maps and character attributes to in-game music and other digital assets," as well as each new console manufacturer listing their e-distribution service as a major selling point, as expanding overall sales to the 22 percent revenue figure. Said Belcher, “Far from stealing revenue from retail outlets, digital downloads may help the gaming industry break through the plateau it has seen for the last several years.” In many publishers' recent financial updates, digital distribution and downloadable content was given special attention, based on the last quarter's results. Activision, for example, recently revealed that it had achieved around $2 million in downloadable console content for the quarter (largely consisting of Call of Duty 2 Xbox Live downloadable maps), double that of the $1 million in the previous quarter. Similarly, EA recently noted that its total digital revenue, which included in-game advertising, Pogo.com casual games, PC micropayments, and Xbox Live revenues, among others, brought in $28 million of revenue in the last quarter, up 40% from the previous year.

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