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Unformatted text preview: Born Digital, Grown Digital. The future competitiveness of the European Videogames Software industry (Draft) EXECUTIVE SUMMARY The present study analyses the video game software industry, its market potential, its value chain organisation and business models and its current line of evolution, so as to outline major emerging technologies and to investigate on their disruptive potential. Moreover, it aims at assessing the strengths and weaknesses of EU firms, in order to highlight drivers, opportunities and challenges for improving the future competitiveness of the EU video game software industry. I. Mapping a very young industry In spite of being a very young industry, video games already managed to become a significant and growing share of the media and content industries. The global video game market is estimated at some 45 to 50 billion € as of 2009, and is expected to grow four times faster than the media and entertainment market 1 to which it belongs. The former one is expected to grow by almost 70% to over 70 billion dollars by 2013, whereas the latter one is expected to grow by only 17%. The video game market already outgrew the cinema market. Global video gam es m arket, m illion US $, PWC 2009 10000 20000 30000 40000 50000 60000 70000 80000 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2 The Europe-Middle East-Africa (EMEA) region is the biggest market for video games: France, Germany, Italy, Spain and UK, in 2009, accounted for 15.2 billion dollars, which is equivalent of nearly 30% of the global video games market. The console game sector is the biggest component of the EU market and is now eight times the size of the one-time market leader, PC games with one analyst predicting the size gap to grow to ten times by 2013 3 . 1 Media & Entertainment includes: internet access fees, internet advertising, TV fees, TV advertising, Recorded music, Filmed entertainment, Video games, Consumer magazine publishing, Newspaper publishing, Radio, Book publishing, Business-to-business publishing 2 Europe is the core market of this region. 3 Price Waterhouse Coopers Global entertainment and media outlook; 2009-2013 - 1 - Global video games and global media and entertainment market (2007-2013 - million US dollars - PWC 2009) 2007 2008 2009 2010 2011 2012 2013 Total Video Games 43,460 51,390 55,089 58,383 61,604 67,026 73,513 Total Media & Entertainment* 1,373,941 1,408,950 1,354,068 1,359,495 1,411,788 1,506,409 1,613,173 Video games market size, billion USD, PWC 2009 5 10 15 20 25 30 EMEA North America Asia Pacific Latin America 2008 2013 Still, maybe even more important than its size and its growth rate, the Videogames Software industry appears to be one of the most innovative labs for the coming Digital Economy: it is developing and experimenting new digital services (on-line, off-line and mobile) that manage to reach a growing share of the population. Born digital, the industry shows a digital growth, that is, taking advantage of many opportunities to offer user-friendly, intuitive services at very...
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- Spring '11