Video Games Market

- Market Reserch -
 SUMMARY

INTRODUCTION

I. History

II. Market Structures

III. Industry forcast

CONCLUSION

2
INTRODUCTION
The video game market is a portion of the
entertainment industry that has quickly and
quietly grown to proportions as big as the
movie industry. Both the United States and
Japan provide the greatest economic markets
for this flowering product.
Not only does the video game industry
produce just games, they also provide home
gaming systems, portable gaming systems
and all of the necessary gadgets to play the
games. 
The revenues figures of the video games
industry has gone from 34 million in 1994
to 45 million today.
History
1970 the computer game industry formed from a hobby culture, when
personal computers just began to become widely available
1980 the fall of the North American industry and giving rise to the
Japanese and professional European industries.
the rise of the Game Boy handheld system.
1990 -The widespread adoption of CD-based storage and software
distribution
-Widespread adoption of GUI-based operating systems such as the
series of Amiga OS, Microsoft Windows and Mac OS
-Advancement in 3D graphics technology
-Miniaturisation of hardware, and mobile phones, which enabled
mobile gaming
The emergence of the internet, which in the latter part of the decade
enabled online co-operative play and competitive gaming
Today, the video game industry is a
juggernaut of development; profit still
drives technological advancement which
is then used by other industry sectors.

Though maturing, the video game

industry is still very volatile.
Market structures
The video game market is characterized as an
oligopoly
The firms are “price makers”: the few firms
like Sony and Microsoft set the price and
output levels to maximize profit levels.
As McConnell-Brue explains, “oligopoly is
thus characterized by mutual interdependence:
a situation in which each firm’s profit depends
not entirely on its own price and sales
strategies but also on those of its rivals.”
Video games industry segments
Industry apportionment
Value chaine
Capital and publishing layer: involved in
paying for development of new titles and
seeking returns through licensing of the titles.
Product and talent layer: includes developers,
designers and artists, who may be working
under individual contracts or as part of in-
house development teams.
Production and tools layer: generates content
production tools, game development
middleware, customizable game engines, and
production management tools.
Value chaine
Distribution layer: or the "publishing" industry,
involved in generating and marketing catalogs of games
for retail and online distribution.
Hardware (or Virtual Machine or Software Platform)
layer: or the providers of the underlying platform,
which may be console-based, accessed through online
media, or accessed through mobile devices such as the
iPhone. This layer now includes non-hardware
platforms such as virtual machines (e.g. Java or Flash),
or software platforms such as browsers or even further
Facebook, etc.
End-users layer: or the users/players of the games.
Age distribution
In the U.S. the video game industry as a whole was worth
USD$10.3 billion.
However, economic problems remain today with regard to
publisher-developer contracts (see copyright: transfer of rights).
Typically, developers receive a royalty of around 20% of the sales
profits, and the rest goes to the publisher.
Rather than dividing royalties, many publishers buy the
development studio outright. Some developers begrudge the
tendency for the studio's original management to leave in the wake
of a buyout, while the remaining employees try to finish the
project only to be shut down after a few years.
These buyouts often result in a big push to finish video game
projects in time for the holiday purchasing season, and transfer of
creative control to the publisher.
Industry forcast
Industry apportionment:
Segment’s developpement
CONCLUSION
Gaming experiences are becoming more
innovative and interactive. At the same
time, consumers are demanding games
with quick, simple games that can be
played on an MP3 or a cell phone.
In fact, different research firms predict
that the industry will grow more than 16%
annually.