Innovation Report Market & Data

The World Video Game Market

5th edition

Markets & Forecasts, 2012-2016 Ref: M12201 – December 2012

Despite the profound changes that are going through it, the global market for video games will resume a new period of growth in 2015 to attain 60 billion Euro in 2016. This study follows the development of key indicators for the sector over five years and makes an appraisal of the key markets: Home consoles Handheld consoles Offline games Online games Mobile phone games

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• What are the driving forces for the strong dynamic of online gaming, a sector which will account for 30% of the global market in 2016? • Is the starting up of the Cloud gaming market likely to profoundly disrupt the launches of the next generations of consoles? • Why does the arrival of games on Smart TV (occasional games on set-top box, games synchronised with live programmes, games on social networks, …) create a new ecosystem between telcos, the Internet, TV channels, manufacturers and video games market actors? • What will be the impact of the rise in strength of continuously accessible ubiquitous games (multiterminal, connected objects, …)?

Contents (Report – PDF )

Database (Excel)

1. Executive Summary

Zones & countries covered:

1.1. Shifts and growth paths for the period 2012-2016 1.2. Ten key industry trends for 2013

2. Methodology 3. The home consoles segment 3.1. Market trends: the shift, act 1 3.2. Equipment: target « Next Gen » consoles 3.3. Software: waiting for the next generation

4. The handheld consoles segment

• World • North America - Canada

- USA

• Latin America • Asia-Pacific -

Australia and New Zealand China South Korea Japan

-

Benelux (consolidated) France Germany Italy Scandinavia (consolidated) Spain United Kingdom

• Western Europe

• Eastern Europe - Poland • EMEA

5.1. Market trends: Smartphone and tablets, two growth drivers for nomad gaming 5.2. Gamers and market: thriving perspectives

-

Sales (million units) Installed base (million units) Average retail price (EUR) Market value (million EUR)

• Home console software • Handheld console software • Computer software for which these segments are examined: - Sales (million units) - Average retail price (EUR) - Market value (million EUR)

6. The computer games segment • Online video games 6.1. Market trends for offline games: the end of an era 6.2. Market trends for online games: towards greater segmentation 6.3. Gamers and market: the potential confirmed

-

December 2012 EUR 3 500 (1-5 user license)

Sales contact: Isabel Jimenez [email protected] Tel.: +33 (0)467 144 404

Project manager Laurent MICHAUD [email protected] Tel: +33 (0)467 144 439

- Russia

4.1. Market trends: new equipment, new Market segments covered: campaign, new challenges • Home console hardware 4.2. Equipment: Sony vs. Nintendo, act 2 • Handheld console hardware 4.3. Software: new platforms, new games for which these segments are examined:

5. The mobile phone games segment

Deliverables • Report (PDF) • Database (Excel)

Premium video gamers Free-to-play video gamers Social video gamers Annual video games ARPU Online games revenue

• Mobile games

- Mobile gamers - Annual video games ARPU - Mobile games market

Other available reports: • Serious gaming • Cloud gaming • World Internet markets & usages • Connected TV

Upcoming reports: • Social Gaming

Watch service: • World connected TV market - Database - Monthly insights - Analyst access

More information at www.idate.org IDATE - BP 4167 – 34092 Montpellier Cedex 5 Tel: +33 (0) 467 144 444 – Fax: +33 (0) 467 144 400 - [email protected] – www.idate.org

World video game market (snapshots)

2012

2012

Source : IDATE

2013

2013

Video Game market, Europe 2011-2016

Online gamers 2011-2016 (Millions)

IDATE – CS 94167 – 34092 Montpellier Cedex 5 Tel: +33 (0) 467 144 444 – Fax: +33 (0) 467 144 400 - [email protected] – www.idate.org

2014

2014

2015

2015

2016

2016

The World Video Games market Choose your report(s)

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Cloud Gaming (August 2012) Online Access - 1-5 users (report +slideshow)

wM12218

Serious Gaming (November 2011) Online Access - 1-5 users (report+slideshow)

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World Internet Markets (Jul./Dec. 2012)

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Innovation Report Innovation

Cloud Gaming What will change for the video game industry Ref: M12218 – July 2012

The gaming industry has been gradually making the shift to digital over the last decade and cloud gaming is the next step in the process. This study examines the challenges facing the industry-wide and commercial deployment of cloud gaming in terms of technology and services. It also identifies the major industrial challenges across the value chain and the growth engines that will encourage development of this new market segment.

www.idate.org

• What role will cloud gaming play in the restructuring of the gaming industry? • How will the various players in the new value chain fit together? Will this be a turning point for device manufacturers? • What will be the new challenges facing console manufacturers? What position will accessories have in these new game forms? • Is connected TV the preferred device for cloud gaming? • Network infrastructure, bandwidth, lag time… what technological challenges need to be resolved for cloud gaming to really take off? • What services will be available and what business and pricing models will be used? • Does cloud gaming herald the end of the console?

Contents (Report – PDF ) 1. Executive Summary 2. Methodology 3. Cloud Gaming’s Central Role in the Video Game Industry’s Shift to Digital 4. Market Structure and Key Factors 4.1. Introduction to cloud computing 4.2. Technological structure of cloud gaming 4.2.1. Architecture and operational method 4.2.2. Technological enhancements (MA) 4.2.3. Technological challenges 4.3. Structure of the cloud gaming industry 4.3.1. Value chain 4.3.2. Segmentation of the industry 4.3.3. Products and service available (MA) 4.4. Factors for market development and platform deployment 4.4.1. Technological limitations 4.4.2. Drawing in gamers with content 4.4.3. Drawing in gamers with services 4.4.4. Is the market ready?

5. Overview of the Cloud Gaming Market 5.1. Industrial analysis 5.1.1. Services available to gaming customers 5.1.2. Business and pricing models 5.1.3. Content publication and catalog strategy 5.1.4. Targeting as a central issue 5.1.5. The user experience 5.2. Case Studies 5.2.1. Summary table

6. Players 6.1. G-Cluster 6.2. Gaikai 6.3. GameStop and SpawnLab 6.4. iSwifter 6.5. OnLive 6.6. OTOY 6.7. PlayCast Media 6.8. Spooncloud Gaming 6.9. T5 Labs 6.10. Ubitus

Includes • Report (PDF) • Slideshow (PDF) July 2012 EUR 3,500 (Licence for 1-5 users)

Sales contact: Isabel Jimenez [email protected] Tel.: +33 (0)467 144 404

Analytical grid for each examined player: • Company • Offering • Partnerships • Business and pricing model

7. Challenges, Market Strategies and Forecasts 7.1. Challenges across the value chain 7.1.1. Cloud gaming service provider 7.1.2. Casual gaming developers and publishers 7.1.3. An additional distribution channel for publishers, a long-term risk for console manufacturers 7.1.4. Consumer electronics manufacturers 7.1.5. Cloud gaming: a loss leader for the Web titans 7.1.6. Retailers 7.1.7. An opportunity for online distributors to break free of the computer 7.1.8. Service and traffic for ISPs and telcos 7.1.9. Challenges related to audience by TV industry players 7.1.10. Cloud gaming is following the industry trend toward interoperability and standardization

8. Annexed list of cloud computing companies

Project Manager Laurent Michaud [email protected] Tel: +33 (0)467 144 439 Other reports available: • World Video Game Market • Connected TV • Telcos’ TV Strategies • Digital Home & Connectable Devices • Ultrafast-Broadband Consumer Market Survey

Upcoming reports: • Telco CDN • Services over FTTH/B

Related Watch Services: • World Connected TV Market • World FTTx Market More info at: www.idate.org

IDATE - BP 4167 – 34092 Montpellier Cedex 5 Tel: +33 (0) 467 144 444 – Fax: +33 (0) 467 144 400 - [email protected] – www.idate.org

Cloud Gaming (Excerpts) Cloud Gaming Value Chain

Source: IDATE

Structure of the Cloud Gaming Industry – Devices

Source: IDATE

Ultrafast-Broadband networks – pivotal element for content dematerialisation * Percentage of homes passed for ultra-fast broadband ** Excluding FTTLA access marketed by cable companies

Source: IDATE, Ultrafast-Broadband consumer market survey, November 2011

IDATE - BP 4167 – 34092 Montpellier Cedex 5 Tel: +33 (0) 467 144 444 – Fax: +33 (0) 467 144 400 - [email protected] – www.idate.org

Cloud Gaming How Will It Change the Game? M12218 – September 2012

 This study includes: - a report - a slideshow

IDATE creates the DigiWorld Institute Founded in 1977, IDATE has gained a reputation as a leader in tracking telecom, Internet and media markets, thanks to the skills of its teams of specialized analysts. Now, with the support of close to 40 member companies – which include many of the digital economy’s most influential players – the newly rebranded DigiWorld Institute has entered into a new stage of its development, structured around three main areas of activity:  IDATE Research, an independent observatory whose task is to keep a close and continual watch on digital world industries, collect relevant data and provide benchmark analyses on market developments and innovations in the telecom, Internet and media sectors – through its comprehensive collection of market reports and market watch services.  IDATE Consulting, time-tested analysis and consultancy solutions: Our multi-disciplinary teams of economists and engineers established their credibility and independence through the hundreds of research and consulting assignments they perform every year on behalf of top industry players and public authorities.  DigiWorld Institute, a European forum open on the world: The DigiWorld Institute will take existing IDATE initiatives, such as the DigiWorld Summit, the DigiWorld Yearbook and the monthly clubs in Paris, London and Brussels, to the next level. Members have the opportunity to participate in think tanks on the core issues that will shape the industry’s future, drawing on the knowledge of outside experts and our own teams.

Contributors > Laurent MICHAUD, Head of Digital Home & Consumer Electronics Practice Laurent Michaud joined IDATE in 2000, and is currently the Head of Digital Home & Consumer Electronics Practice. Laurent acts as project manager for market reports on the rise of Digital Home, on home and nomad electronic and connected devices through video, television, video games, and music industries. He provides OSEO (a national business development and support organisation) with expert technicaleconomic analysis of strategic issues relating to consumer electronics. Mr. Michaud holds a post-graduate degree in Economic and Financial Regional Project Engineering from the Université de Montpellier. [email protected]

> Meredith ALFROY, Consultant ISBN 978-2-84822-324-7 ISSN 2109-6791

Copyright IDATE 2012, BP 4167, 34092 Montpellier Cedex 5, France All rights reserved. None of the contents of this publication may be reproduced, stored in a retrieval system or transmitted in any form, including electronically, without the prior written permission of IDATE. IDATE, DigiWorld, DigiWorld Institute and DigiWorld Yearbook are the international registered trademarks of IDATE.

Cloud Gaming – How Will It Change the Game?

Contents 1.

Executive Summary ........................................................................................ 6 1.1.

Eight major advantages cloud gaming provides across the value chain ............... 7

1.2.

Four major technological challenges ...................................................................... 7

1.3.

Six challenges for services in drawing in gamers .................................................. 8

1.4.

Ten market challenges across the value chain ...................................................... 8 1.4.1. 1.4.2. 1.4.3.

Cloud gaming service providers: quickly become a key market player .................. 9 Casual game developers and publishers: more than one growth driver ................ 9 An additional distribution channel for publishers, a long-term risk for console manufacturers...................................................................................................... 10 1.4.4. Consumer electronics manufacturers: paving the way for cloud gaming ............. 10 1.4.5. Cloud gaming: a loss leader for the Web titans and a factor for market concentration ....................................................................................................... 10 1.4.6. Retailers: is cloud gaming a secondary objective? .............................................. 10 1.4.7. An opportunity for online distributors to break free of the PC .............................. 11 1.4.8. Service and traffic for ISPs and telcos ................................................................. 11 1.4.9. Capturing audience for TV industry players ......................................................... 11 1.4.10. Cloud gaming, like the rest of the industry, is moving toward ubiquity and standardization .................................................................................................... 12

2.

Methodology .................................................................................................. 14

3.

Cloud Gaming’s Central Role in Video Game Digitization.......................... 16

4.

Market Structure and Key Factors ............................................................... 22 4.1.

Introduction to cloud computing ........................................................................... 22

4.2.

Annexed list of cloud computing companies ........................................................ 29

4.3.

Technological structure of cloud gaming .............................................................. 29 4.3.1. 4.3.2. 4.3.3.

4.4.

Structure of the cloud gaming industry................................................................. 40 4.4.1. 4.4.2. 4.4.3.

4.5.

Architecture and operation of cloud gaming ........................................................ 30 Pros and cons of cloud gaming technologies ...................................................... 34 Technological issues ........................................................................................... 37

The cloud gaming value chain ............................................................................. 40 Segmentation of the cloud gaming industry ......................................................... 42 Cloud gaming offering overview .......................................................................... 43

Factors for market development and platform deployment .................................. 44 4.5.1. 4.5.2. 4.5.3. 4.5.4.

Technological limitations ..................................................................................... 44 Drawing in gamers with content........................................................................... 45 Drawing in gamers with services ......................................................................... 47 Is the market ready? ............................................................................................ 49

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3

Cloud Gaming – How Will It Change the Game?

5.

Overview of the Cloud Gaming Market ........................................................ 50 5.1.

Industry analysis ................................................................................................... 50 5.1.1. 5.1.2. 5.1.3. 5.1.4. 5.1.5.

5.2.

6.

Services offered to gamer customers .................................................................. 50 Business and billing models ................................................................................ 51 Publishing and catalog strategies: AAA vs. casual and social games ................. 54 Targeting as a central issue................................................................................. 59 User experience .................................................................................................. 61

Case studies ......................................................................................................... 64

Player Profiles ............................................................................................... 66 6.1.

Gaikai ................................................................................................................... 66

6.2.

GameStop / Spawn Labs ..................................................................................... 70

6.3.

G-cluster ............................................................................................................... 72

6.4.

iSwifter .................................................................................................................. 77

6.5.

OnLive .................................................................................................................. 80

6.6.

OTOY ................................................................................................................... 85

6.7.

Playcast Media ..................................................................................................... 88

6.9.

Spoon cloud gaming............................................................................................. 92

6.10. T5 Labs................................................................................................................. 94 6.11. Ubitus ................................................................................................................... 96

7.

Challenges, Market Strategies and Forecasts ............................................. 99 7.1.

Challenges across the value chain ...................................................................... 99 7.1.1. 7.1.2. 7.1.3.

Cloud gaming service provider: quickly become a key market player ................. 99 Casual game developers and publishers: more than one growth driver ............ 102 An additional distribution channel for publishers, a long-term risk for console manufacturers.................................................................................................... 103 7.1.4. Consumer electronics manufacturers: paving the way for cloud gaming ........... 104 7.1.5. Cloud gaming: a loss leader for the Web titans and a factor for market concentration ..................................................................................................... 104 7.1.6. Retailers: is cloud gaming a secondary objective? ............................................ 104 7.1.7. An opportunity for online distributors to break free of the PC ............................ 105 7.1.8. Service and traffic for ISPs and telcos ............................................................... 105 7.1.9. Capturing audience for TV industry players ....................................................... 105 7.1.10. Cloud gaming, like the rest of the industry, is moving toward ubiquity and standardization .................................................................................................. 106

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Cloud Gaming – How Will It Change the Game?

Tables Table 1: Table 2: Table 3: Table 4: Table 5: Table 6:

World video game market: physical vs. digital game sales, 2011-2015 .......................... 16 Revenue from digitization by platform ............................................................................. 16 Number of super fast broadband subscribers by country and super fast broadband's share of connected households, year-end 2010 ............................................................. 18 FTTx coverage and penetration by country, year-end 2010 ........................................... 18 Summary table of pricing strategies in use ..................................................................... 53 Connected TV sales forecasts, 2012-1016 ..................................................................... 54

***

Figures Figure 1: Figure 2: Figure 3: Figure 4: Figure 5: Figure 6: Figure 7: Figure 8: Figure 9: Figure 10: Figure 11: Figure 12: Figure 13: Figure 14: Figure 15: Figure 16: Figure 17: Figure 18: Figure 19: Figure 20: Figure 21: Figure 22: Figure 23: Figure 24: Figure 25:

Share of data center activity processed in the cloud ....................................................... 22 Change in cloud computing spending by IT companies worldwide, 2008-2013 .............. 23 Players in the cloud computing value chain .................................................................... 23 Structure of cloud computing services ............................................................................ 24 Applications of IaaS ........................................................................................................ 26 Applications of PaaS ....................................................................................................... 27 Applications of SaaS ....................................................................................................... 28 Applications of cloud computing ..................................................................................... 28 Current roles of cloud gaming players ............................................................................ 30 Changing roles of cloud gaming players ......................................................................... 30 Technological architecture of cloud gaming .................................................................... 31 Operation cycles for a video game played on a local system and a cloud gaming system33 Structure of cloud gaming services by cloud computing technology ............................... 40 Cloud gaming value chain............................................................................................... 41 Where cloud gaming fits in the traditional video game value chain ................................. 43 Positioning of the main CGSPs ....................................................................................... 43 Potential development scenario of a content strategy based on casual games .............. 56 Potential development of game catalog content ............................................................. 56 Worldwide online gamers................................................................................................ 59 G-cluster’s business model ............................................................................................. 75 Onlive business model .................................................................................................... 84 Playcast Media’s business model ................................................................................... 90 Ubitus cloud computing technology ................................................................................ 97 UbiLive servers ............................................................................................................... 97 How GameCloud works .................................................................................................. 97

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5

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Serious Gaming Education • Training • Health Care Information & Communication • Defence (3rd Edition)

Innovation Reports This study examines the various market segments of Serious Gaming based on detailed case studies and a systematic presentation of the corresponding technologies, practices and know-how, while

Key questions • What are the stakes associated with the development of this industry: know-how, development costs, economic models, industrial and publishing strategies? • What are the recent changes in the value chain of the Serious Gaming industry? • Who are the main players involved in Serious Gaming?

emphasising on the key stages of the design, development and dissemination phases. It also provides technology

• What practices and audiences are being targeted by Serious Games? • What are the latest trends in terms of content and gameplay? • What are the prospects by market segment?

and business prospects for each market segment.

Consulting & Research

> Presentation of the 34 key projects of the Serious Gaming market

w w w. i d a t e - r e s e a r c h . c o m

◊

Serious Gaming Education • Training • Health Care • Information & Communication • Defence

Contents 1. Executive Summary 2. Methodology 3. Development Prospects 3.1. Technological Prospects 3.1.1. HMI 3.1.2. Image Processing 3.1.3. Network Gaming 3.1.4. Mobility 3.1.5. Robotics 3.1.6. Other • Software systems • Game factories • Metrics 3.2. Business Prospects • Jobs and training • Project management assistance 3.3. Economic Prospects 3.3.1. Germany 3.3.2. Belgium 3.3.3. China 3.3.4. Spain 3.3.7. United States 3.3.5. France 3.3.6. United Kingdom

4. Education 4.1. Definition 4.2. Technology Issues • Use of 3D • Accessories • Development tools 4.3. Business Issues 4.4. Economic Issues • Economic models of the academic sector • Low-price SG: a complex approach • Towards new models? • Market perspectives 4.5. Case Studies

5. Training 5.1. Definition 5.2. Methodological Issues • Introduction to 3D • The leading role of mobile devices • Development tools

5.3. Business Issues • Barriers to SG • Participation of teachers in the development of SGs 5.4. Economic Issues • Key accounts, major clients • Market perspectives 5.5. Case Studies

6. Health Care 6.1. Definition 6.2. Technology Issues • An industry sensitive to technological innovation • User-friendly interfaces • The functional and economic value of Microsoft Kinect 6.3. Business Issues • Value of SG for disease prevention • Capture of expertise from health professionals 6.4. Economic Issues • A big budget B2B model and mainstream paramedical health teaching • Market perspectives 6.5. Case Studies

7. Information & Communication 7.1. Definition 7.2. Technology Issues • Cross-media communication to generate buzz • Game applications and the Fun Theory 7.3. Business Issues • Impact analysis 7.4. Economic Issues • The search for profitable economic models • Market perspectives 7.5. Case Studies

8. Defence 8.1. Definitions 8.2. Technology Issues • 2D SGs • Cultivating the disruption 8.3. Business Issues 8.4. Economic Issues 8.5. Case Studies

(3rd Edition)

120 pages PDF: 3 500 EUR November 2011

To order, please contact :

Isabel JIMENEZ [email protected] tel: +33 (0)467 144 404

Project Manager Laurent MICHAUD [email protected] tel: +33 (0)467 144 439

Related reports from IDATE: • World Video Game Market • InGame Advertising • Video Games App stores • The Digital Home & Connectable Devices www.idate-research.com

The value chain of Serious Gaming is gaining technical and commercial intermediaries

Projects studied Training & Teaching

Mass media Communication

• Diversité - Daesign • Entretien de recadrage ITycom • History Games Interaction Games • EDF - Real Fusio • Houthoff Buruma The Game Ranj • Infinity Crossroads Digital Media

• Olympe - 3DDUO

• Mémorial de Caen Highfive

• Jeu Serai Wizarbox

• L’Experience Actiplay

• Largo Winch Entropic Synergies

• Forrestia Creo

• My Cyber AutoEntreprise Succubus Interactive

• Ping Grin Multimedia

• The Plague Serious Games Interactive • Sauver Ada – Abeille communications/Belle Production • Smartkwizz - C-Services

• Energy Wise PIXELearning

• Portal Places Taatu Studio

• Mondokiddo - Mutant Labs

• Sea Sim Crisis - VirDys

• Bulletproof Mobigame

• Neurodyssée Belle Productions

• Ludwig - Ovos

Corporate Communication

• Suez Environnement Ambassador KTM Advance

Healthcare • Elude MIT GAMBIT Lab/ Birdy Inc • eMotion 1.0 VirtualWare • Ludomedic CCCP • My Quit Kit&Khemia Hoozinga Game Media • Replay Brainstorm

• Rallye Place-Royale Musée de la civilisation Idéeclic • Star’Ecologie Playsoft

• The Mindty Ant Macrotellect Ltd • Wingineer 3 - Esica

For each project: Description

• Year of creation – Objectives – Partners – Designer/Editor

Company

• Activity – Number of employees – Turnover – Localization

Partnerships

• Technological – Trade – Sales

Game description

• History – Gameplay – Technology – Feedback – Screenshots

Economics of the project

• Develoment costs – Profession’s contribution to development costs – Sponsors (if any) and degree of involvement

Business model

• Princing strategy – Revenue sharing – Sales target – Target breakeven point

Marketing

• Strategy – Budget – Sales force – Geographical coverage BP 4167 – 34092 Montpellier Cedex 5 Tel : +33 (0) 467 144 444 – Fax : +33 (0) 467 144 400 [email protected] – www.idate-research.com

Digital Home & Entertainment

Innovation Report

Serious Games: Issues, offer and market Education  Training  Health Care Information & Communication  Defence (3rd Edition)

M11213 – January 2012

Contributors

► Laurent MICHAUD, Head of the Consumer Electronics and Digital Entertainment Practice Laurent conducts studies on consumer electronics, the digital home, video games, music and the related trends: changing uses, new uses and peripherals, technology innovation, piracy, content protection and rights management. Laurent has developed expertise in the field of economic development and capital project engineering. In fact, he is also involved in the studies conducted by IDATE on behalf of local authorities for the formulation of ICT development strategies. He conducts technical and economic analyses for OSEO and incubators on gaming and multimedia content development issues and participates in industry, market and strategic studies on ICTs, television, Internet and video. Laurent is the th instigator of the DigiWorld G@me Summit, whose 10 edition was held in Montpellier in November 17, 2011 during the DigiWorld Summit. This event is organised with the support of the major French and European video game players: SNJV, SELL, ISFE, EGDF, Capital Games, and AFJV. Laurent holds a Master of Economic and Financial Engineering. [email protected]

► Julian ALVAREZ – Véronique ALVAREZ – Damien DJAOUTI www.ludoscience.com

Copyright IDATE 2012, BP 4167, 34092 Montpellier Cedex 5, France Tous droits réservés – Toute reproduction, stockage ou diffusion, même partiel et par tous moyens, y compris électroniques, ne peut être effectué sans accord écrit préalable de l'IDATE.

ISBN 978-2-84822-287-5 ISSN 2109-6791

All rights reserved. None of the contents of this publication may be reproduced, stored in a retrieval system or transmitted in any form, including electronically, without the prior written permission of IDATE.

Serious Games: Issues, offer and market

Contents 1 Executive summary .......................................................................................................... 6 2 Methodology ...................................................................................................................... 7 3 Cross-sectional analysis .................................................................................................. 9 3.1 Ten trends and industrial issues .................................................................................. 9 3.1.1 3.1.2 3.1.3 3.1.4 3.1.5 3.1.6 3.1.7 3.1.8 3.1.9 3.1.10

SG as a fusion of several disciplines ............................................................................. 9 Segmentation of the value chain .................................................................................. 10 An approach based on partnerships ............................................................................ 12 Waiting for ubiquitous SGs and SGs for connected TV ............................................... 13 Publishing: downward trend in the number of SGs published ...................................... 14 A refocusing of SG themes in terms of numbers of published titles ............................. 15 Dematerialisation in line with usage trends .................................................................. 16 Growing development costs ......................................................................................... 17 Evolving business models ............................................................................................ 17 What to expect in 2012 ................................................................................................ 18

3.2 Economic outlook ...................................................................................................... 19 3.2.1 3.2.2 3.2.3 3.2.4 3.2.5 3.2.6 3.2.7 3.2.8

The global SG market .................................................................................................. 19 The French market....................................................................................................... 22 The German market ..................................................................................................... 26 The Belgian market ...................................................................................................... 26 The Chinese market ..................................................................................................... 27 The Spanish market ..................................................................................................... 27 The UK market ............................................................................................................. 28 The US market ............................................................................................................. 28

3.3 Technology outlook ................................................................................................... 29 3.3.1 3.3.2 3.3.3 3.3.4 3.3.5 3.3.6

Human-computer interaction (HCI) .............................................................................. 29 Image processing......................................................................................................... 30 Network games ............................................................................................................ 30 Mobility ......................................................................................................................... 30 Robotics ....................................................................................................................... 31 Other technologies ....................................................................................................... 32

3.4 Business outlook ....................................................................................................... 32

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Serious Games: Issues, offer and market

4 Educational SGs .............................................................................................................. 35 4.1 Characterisation of the market segment ................................................................... 35 4.2 Statistics .................................................................................................................... 36 4.3 Technology issues ..................................................................................................... 37 4.4 Market segment issues ............................................................................................. 38 4.5 Market segment outlook ............................................................................................ 38 4.6 Case studies .............................................................................................................. 40 5 Training SGs .................................................................................................................... 54 5.1 Characterisation of the market segment ................................................................... 54 5.2 Statistics .................................................................................................................... 55 5.3 Technology issues ..................................................................................................... 56 5.4 Market segment issues ............................................................................................. 58 5.5 Market segment outlook ............................................................................................ 59 5.6 Case studies .............................................................................................................. 60 6 Health care SGs ............................................................................................................... 79 6.1 Characterisation of the market segment ................................................................... 79 6.2 Statistics .................................................................................................................... 81 6.3 Technology issues ..................................................................................................... 82 6.4 Market segment issues ............................................................................................. 84 6.5 Market segment outlook ............................................................................................ 85 6.6 Case studies .............................................................................................................. 86 7 Information and communication SGs ........................................................................... 98 7.1 Characterisation of the market segment ................................................................... 98 7.2 Statistics .................................................................................................................. 100 7.3 Technology issues ................................................................................................... 101 7.4 Market segment outlook .......................................................................................... 104 7.5 Case studies ............................................................................................................ 106 8 Defence SGs .................................................................................................................. 126 8.1 Statistics .................................................................................................................. 127 8.2 SGs in 2D ................................................................................................................ 128 8.3 Cultivating disruption ............................................................................................... 130 8.4 Case studies ............................................................................................................ 132

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Serious Games: Issues, offer and market

List of tables Table 1:

Global SG market, 2010-2015 ........................................................................................ 19

Table 2:

The global SG value market ........................................................................................... 21

Table 3:

Summary of public and private spending as part of the 2009 call for SG projects (a.k.a. AAP NKM) ...................................................................................................................... 24

Table 4:

Valuation of the SG industry in France: an approach in terms of value creation ............. 25

***

List of figures Figure 1:

SG, an interdisciplinary synthesis ................................................................................... 10

Figure 2:

The players of the SG value chain .................................................................................. 11

Figure 3:

Collaborative R&D projects as part of a consortium ....................................................... 12

Figure 4:

Commissioned gaming projects ...................................................................................... 13

Figure 5:

Medium term industry outlook ......................................................................................... 14

Figure 6:

Number of SG titles published worldwide between 2005 and 2010 ................................ 14

Figure 7:

Evolution of the number of SG titles published worldwide by target industry between 2005 and 2010 ................................................................................................................ 15

Figure 8:

Distribution of SG reference titles worldwide by target market in 2005 and 2010 ........... 16

Figure 9:

Dematerialisation of SG distribution media ..................................................................... 16

Figure 10:

Development budgets of SGs in 2009-2010 ................................................................... 17

Figure 11:

Possible flows within SG business models ..................................................................... 18

Figure 12:

Evolution of the global SG market, 2010-2015 ............................................................... 19

Figure 13:

Evolution of the SG market in France, Germany and the UK, 2010-2015....................... 20

Figure 14:

Location of SG publishers and commissioners in France, December 2010 .................... 23

Figure 15:

Location of SG designers and developers in France, December 2010 ........................... 25

Figure 16:

Percentage of SG per market segment from 2002 to 2009............................................. 80

Figure 17:

Percentage of the various SG contents from 2002 to 2009 ............................................ 98

www.idate-research.com © IDATE 2012

5

Innovation Report Market & Data

World Internet Markets Search • Social Network • Video • E-commerce • Mobile Apps • Online Advertising Fixed and Mobile Internet Ref: M12101 – July 2012

This report provides data and forecasts on the Internet services Markets - uses and revenues, by country and region. It is structured around the following key services: search engines, social networks, e-Commerce, video services, mobile apps, online advertising and direct paid revenues – both fixed and mobile. It covers Europe, North America and Asia, and analyses the major trends by segment as well as the key players in the market.

www.idate.org

• What is the balance between the growth of Internet usage and revenue generation? Is the imbalance widening or closing? • Which regions and countries dominate the Internet market today? Will Asia show the largest growth to eventually dominate in the future? • Who benefits from the current growth? Are we moving towards an oligopoly? • How will the key uses of the Internet evolve? How is the mobile Internet market evolving? • What are the trends amongst the leading Internet markets: search engines, advertising, e-commerce, video, social networks and mobile applications? • How are the two main revenue generators for the Internet – advertising and direct paid revenues – shaping the market and how will they evolve?

Contents

(slideshow – PDF)

1. Key findings: the Internet Economy 2. Worldwide Internet Usage 2.1 Internet users still growing and set to grow further, especially mobile 2.1.1. Number of Internet users 2.1.2. Internet penetration 2.2. Evolution of key Internet usages 2.2.1. Search to remain the most popular fixed online activity 2.2.2. Search and social networking lead mobile usage

3. Key Internet Players 3.1. Google 3.1.1. Continuing to lead the Internet with diversified services 3.1.2. Despite diversification, advertising the main revenue 3.2. Facebook 3.2.1. Monetisation is still an issue for the social networking giant 3.2.2. From solely advertising to a more hybrid approach 3.3. Amazon 3.3.1. Evolving to provide digital content and 3rd party tools 3.3.2. Resulting in healthy year-on-year annual turnover 3.4. Apple 3.4.1. Majority of sales is through devices, with mobile becoming evermore important 3.5. Comparison of content revenue per user for Google, Apple and Facebook 3.5.1. Google increasing, Apple decreasing, and Facebook rather lagging behind

Deliverables

4. Online search 4.1. Online search – usage • Fixed search • Mobile search 4.2. Online search – revenues 4.2.1. USA dominates search market 4.2.2. UK dominates in terms of revenue per user

5. E-Commerce 5.1. Usage and revenues 5.1.1. Online shoppers 5.1.2. E-commerce revenues 5.2. Revenue per online shopper and m-commerce share 5.2.1. Revenue per online shopper 5.2.2. Share of m-commerce

6. Social Networks 6.1. Social networks – usages • Social network on the fixed • Social network on the mobile 6.2. Social networks – revenues • Advertising revenues • Paid revenues

7. Online Video 7.1. Fixed OTT online video - Usages 7.1.1. China has most users and will have largest growth 7.1.2. A mature market; growth to come from emerging regions 7.2. Fixed OTT online video - Revenue 7.2.1. USA dominates video ad market; all countries to grow 7.2.2. Paid revenue also dominated by USA

8. Online Advertising 8.1. Online advertising • Online advertising revenues • Share of online advertising in overall media advertising 8.2. Online advertising mobile • Mobile online advertising • Share o mobile in total online advertising revenue

• Report (slideshow format PDF) • Database (Excel)

July + December 2012

EUR 3,500 (1-5 user licence, includes one update)

Sales contact: Isabel Jimenez [email protected] Tel.: +33 (0)467 144 404

Project Manager Soïchi Nakajima [email protected] Tel: +33 (0)467 144 458

Available related reports: • Mobile LBS • M2M • Multi-play: new supplyside strategies • Apps and the mobile Internet • Cloud & Big Data

Upcoming reports: • • • •

NFC: mobile payments Traffic management OTT Video & CDN Live OTT

More information at: www.idate.org

IDATE - BP 4167 – 34092 Montpellier Cedex 5 Tel: +33 (0) 467 144 444 – Fax: +33 (0) 467 144 400 - [email protected] – www.idate.org

Database (excel) Regions and

Data

countries covered

Actuals: 2008-2011 • Estimates: 2012 • Forecasts up to 2016

•

World

•

Access fixed and mobile : Internet subscribers (breakdown by volume, AGR & density)

•

Europe-27

•

Internet usages fixed & mobile: Internet users (breakdown by volume, AGR & penetration)

•

Europe-5

•

•

Asia-Pacific

Search fixed & mobile: Internet searchers ( breakdown by volume, AGR, Search usage %among Intenet users)

•

USA

•

E-commerce : fixed E-buyers (breakdown by volume, AGR, %among internet users), Ecommerce revenues (million EUR) , M-commerce revenues

•

UK

•

•

France

•

Social Networks (including virtual worlds) fixed & mobile: Social networkers (breakdown by volume, AGR, Social network usage %among fixed & mobile Internet users) – Social Networking revenues (breakdown by paid and advertising)

Germany

•

•

Italy

•

Spain

Video OTT fixed: Users (volume, AGR, % among fixed internet users), adverttising revenues (breakdown by premium on demand and short clips), paid revenues (breakdown by SVoD & VoD)

•

Japan

•

Advertising: Online advertising revenues (breakdown by Display, Search and other online ad revenues), total media ad revenues, share of mobile ad revenues (million EUR)

•

South Korea

•

•

China

Mobile Applications: revenues for downloads, subscriptions & in-app purchases (million EUR)

Evolution forecast of penetration of key fixed Internet services worldwide 100% 79%

82%

75%

72%

80% 55%

60%

59% 44%

47%

40% 20% 0% search

social networks 2012

OTT video

E-commerce

2016

Source : IDATE – Juin 2012

Evolution forecast of penetration of key mobile Internet services worldwide 40% 30%

27%

30% 20%

19% 20% 10% 0% search

social networks 2012

2016

Source : IDATE – Juin 2012 IDATE - BP 4167 – 34092 Montpellier Cedex 5 Tel: +33 (0) 467 144 444 – Fax: +33 (0) 467 144 400 - [email protected] – www.idate.org

Market & Data

World Internet Markets Soichi NAKAJIMA Senior Consultant Tel: +33 (0)467 144 458 E-mail: [email protected]

Search ● Social Networking ● Video ● E-commerce ● Mobile Apps ● Online advertising Fixed & Mobile Internet

 This study includes: - A slideshow - An Excel database

M12101 – July 2012

Copyright © IDATE 2012

Contributor ˃ Soichi NAKAJIMA, Senior Consultant Soichi joined IDATE as a senior consultant in January 2009. His main area of endeavour is the mobile Internet market, applications, contents and services, the analysis of strategies employed by the various players, scenario building and forecasts. He covers a wide range of topics on the Internet, from APIs to social networks to name but two. Before coming to IDATE, Soichi worked for NTT DoCoMo, Japan’s largest mobile network operator by subscriber numbers, where he played a leading role in the strategic planning of the roll-out of Japan’s first 3G M2M data-only tariffs. Soichi holds a Bachelor’s degree in mathematics, from the University of Nottingham in the UK.

Copyright IDATE 2012, BP 4167, 34092 Montpellier Cedex 5, France Tous droits réservés – Toute reproduction, stockage ou diffusion, même partiel et par tous moyens, y compris électroniques, ne peut être effectué sans accord écrit préalable de l'IDATE. IDATE et DigiWorld sont des marques internationales déposées de l’IDATE.

2

All rights reserved. None of the content of this publication may be reproduced, stored in a retrieval system or transmitted in any form, including electronically, without the prior written permission of IDATE IDATE, and DigiWorld are the international registered trademarks of IDATE

Copyright © IDATE 2012

Table of contents Re port content

Ke y issues

1. Key findings: the Internet economy 2. Worldwide Internet usage

This report provides data and forecasts on the Internet services Markets - uses and revenue, by country and region.  What is the balance between the growth of Internet usage and revenue generation? Is the imbalance widening or narrowing?  Which regions and countries dominate the Internet market today? Will Asia show the highest growth and eventually dominate the market?  Who benefits from the current growth? Are we moving towards an oligopoly?  How will the key uses of the Internet evolve? How is the mobile Internet market evolving?  What are the trends amongst the leading Internet markets: search engines, advertising, e-commerce, video, social networks and mobile applications?  How are the two main revenue generators for the Internet – advertising and direct paid revenue – shaping the market and how will they evolve?

2.1 Internet user growth expected to continue apace, especially on mobile 2.2. Evolution of popular applications

3. Key Internet players 4. Online search 4.1. Online search: usage 4.2. Online search: revenue

5. E-Commerce 5.1. Usage and revenue 5.2. Revenue per online shopper and m-commerce

6. Social Networks 6.1. Social networks: usage 6.2. Social networks: revenue

7. Online Video 7.1. Fixed OTT video: usage 7.2. Fixed OTT video: Revenue

8. Online advertising 8.1. Online advertising 8.2. Mobile advertising 3

Copyright © IDATE 2012

Methodology

4

List of indicators by region and by country  The "World Internet Markets" report consists of this PDF report and a detailed dataset containing the following indicators

5

Copyright © IDATE 2012

Sources  Historical data are established based on the following information sources: -

primary data obtained from one-on-one interviews with the sector’s decision-makers secondary data which are established by cross-referencing public sources and external databases

These various sources have been compared and completed whenever necessary by estimates from our experts. Figures from previous editions of this report have also been revised thanks to newly available information, corrections and adjusted national data.  Our forecasts are based on hypotheses of the expected growth of penetration rates for the different distribution networks (% of the population) in the different markets, and of how ARPU will evolve. The hypotheses depend on several factors: -

current level of market development market potential gauged by the current state of development in the economy as a whole state of the national industry – e.g. upcoming launch of new products/services changes in consumer behaviour.

 Regarding currency and GDP data: -

6

National market data are presented in the national currency and converted to euros. The conversion rate used (IMF average for 2011) can be found at the top of each tab. Background data and forecasts for national and regional GDP (based on IMF data from 2012) are converted into EUR.

Copyright © IDATE 2012

Research Catalogue

Reports & Services Networks & Telecom • Networks & Equipment • Telecom Strategies • Mobile • Broadband / FTTH • Satellite

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TV & Internet

• Internet Services • TV & Video • Digital Content • Digital Home • Video Games

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2012 Research Catalogue IDATE presents its Market Reports Programme for 2012 which constitutes a natural extension of the work performed by our teams of analysts, as well as our ongoing investments in information and monitoring systems for player strategies and markets. More than just a catalogue of publications, this constitutes a concrete manifestation of our drive to create a unique tool geared towards understanding and monitoring the Telecom, Internet and Media sectors.

3 pivotal collections for an easy navigation between the different reports and services: Watch Services Continuous watch on high-potential markets including trackers, insights & live sessions with lead analysts

Market & Data reports Exhaustive market reports: trends, players, actuals & forecasts of markets by segment and by country

Innovation reports Qualitative approach of prospective issues

Ref

Market intelligence reports

Telecom Series

Market & Data reports -

M11411 M11312 M11316 M12310 M11301 M12314 M12315 M12306 M12412 M12311

M10304 M10312 M11319 M11317 M11307 M12413 M12312 M12308 M12320 M12304 M12319 M12313

Ref

Them es

Publication

Deliverables

Price in Euro

full report, database & slideshow

SME Equipment - B2B Survey in France: Telecom, IT, Internet Trends in Telco Capex - Down, but not out Ultrafast-Broadband - B2C Survey in France, Japan, Sweden, UK, USA Satellite Ultra-Broadband World Telecom Services Markets Radio Spectrum Satellite M2M Next Gen Mobile Devices Smartphones in Business - B2B/B2C: Equipment & usage, including BYOD Future Telecom - Scenarios 2020 Innovation reports - full report & slideshow Services over FTTH/B Satellite Markets - New Growth Engines Mobile Backhaul Strategies VDSL2 Vectoring LTE Telcos Strategies Smart Cities Strategies of Telecom Operators - How to retain margins Multi play - new supply side strategies FTTx Services - Supply-side strategies: monetizing the networks Next Gen Access deployment costs Vertical Markets Telcos Pricing Strategies

Market intelligence reports

Media Series

Survey

Aug. 11

3

8 500

Telecom Strategies

Nov. 11

3

3 500

Survey

Nov. 11

3

8 500

Satellite

June 11 / Oct. 12

3

3 500

Telecom Strategies

Jan. 12

3

3 500

Mobile

Oct. 12

3

3 500

Satellite

March 12

3

3 500

Mobile

May 12

3

3 500

Survey

July 12

3

8 500

Prospective

Dec. 12

3

4 500

Broadband

Jan. 11

2

3 500

Satellite

July 11

2

3 500

Netw orks

Aug. 11

2

3 500

Broadband

Dec. 11

2

3 500

Mobile

Dec. 11 / Nov. 12

2

3 500

Netw orks

July 12

2

3 500

Telecom Strategies

June 12

2

3 500

Telecom Strategies

June 12

2

3 500

Broadband

Sept. 12

2

3 500

Netw orks

Sept. 12

2

3 500

Telecom Strategies

Sept. 12

2

3 500

Telecom Strategies

Nov. 12

2

3 500

Them es

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Deliverables

Price in Euro

Market & Data reports - full report, database & slideshow

M10118 M11216 M11116 M12200 M12201 M12214 M12212 M12218

M10214 M11211 M11215 M11214 M11213 M12210 M12215

Online Video Digital Home & Connected Devices eBooks World Television Markets World Video Game Markets DTT: The economics of the digital terrestrial transition Next Gen TV - Scenarios 2020 Cloud Gaming Innovation reports - full report & slideshow TV Groups' Quadruple-Screen Strategies Satellite TV in Europe - Will the future of satellite be guided by 3D? Hybrid TV Prospects - What impact on Connected TV? Telcos TV Strategies - From a strategy of differentiation to one of innovation Serious Games Connected TV - Services & Interfaces, Strategies, Players, Forecasts Cable & IPTV face to cord-cutting

TV & Digital Content

Oct. 11

3

3 500

Consumer Electronics

Oct. 11

3

3 500

Digital Content

Oct. 11

3

3 500

TV observatory

Jul. 12 / Dec. 12

6

3 500

Video Game observatory

Nov. 12

6

3 500

Netw orks

May 12

3

3 500

Prospective

June 12

3

4 500

Digital Entertainment

Aug. 12

3

3 500

TV & Digital Content

Nov. 10

2

3 500

Netw orks

April 11

2

3 500

Netw orks

Dec. 11

2

3 500

Telecom Strategies

Dec. 11

2

3 500

Digital Entertainment

Dec. 11

2

3 500

TV & Digital Content

March 12

2

3 500

Netw orks

Nov. 12

2

3 500

Contact us: Isabel Jimenez - [email protected] - Tel: +33 467 144 404 > More details online - Contents, Methodologies, Summaries on www.idate.org

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