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Online Gaming Going Great Guns

ABI Research announced it forecasts that online gaming revenues will exceed $20 billion in 2012.

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Unedited press release follows:

Online Gaming Will Be a $20 Billion Business in 2012 with Opportunities for More Connected Devices, Says ABI Research

SCOTTSDALE, Ariz.–Driven by North American, European and Asia Pacific markets, online gaming continues its steady growth and the latest study from ABI Research forecasts revenues of slightly more than $20 billion in 2012. Technology developments will mean new opportunities for connected devices beyond the computer.

The Asia-Pac region, especially China, will be the engine behind much of this growth. However, in China, due to generally lower levels of personal PC ownership, the business models are evolving a little differently. According to industry analyst Michael Inouye, “World of Warcraft, for instance, generates significant revenue for Activision in Europe and North America on a subscription basis. But in China, despite a large ‘subscriber’ base, the revenues are far smaller: it’s more of a pay-as-you-go model (prepaid game cards). This also creates a greater reliance on ‘cloud’ or server-based games.”

Another difference in Asia is regulation. “In China, Korea, Vietnam, and elsewhere the rules are more exacting in what they allow. Some games for instance, have had to alter their content: using WoW again as an example, the developers had to remove the virtual blood.”

The increasingly varied and range of connected devices will also permit gaming on more platforms. For example Free, a French broadband and IPTV provider, has partnered with Intel to develop a very advanced set-top box (Freebox Revolution). The STB includes an Intel Atom processor, controller with gyroscopic inputs, Blu-ray player, powerline adapters, Wi-Fi, and a game controller. While these games might be more locally- based for now, they point to the potential for opening this up to multiplayer and MMO gaming.

There are challenges, though. Mobile gaming (eg. on smartphones) could be disruptive. The market is fragmented, with proprietary platforms the rule, posing difficulties for developers trying to serve a number of smaller platforms rather than a few big ones. And the growth of cloud gaming demands more and bigger servers and data centers.

ABI Research’s “Gaming in the Cloud” study ( examines the casual and Massively Multiplayer Online (MMO) games markets and the potential role for connected consumer electronics. It contains regional revenue forecasts and discusses pressing technical issues.

It is part of the Digital Living Research Service (

ABI Research provides in-depth analysis and quantitative forecasting of trends in global connectivity and other emerging technologies. From offices in North America, Europe and Asia, ABI Research’s worldwide team of experts advises thousands of decision makers through 30+ research and advisory services. Est. 1990.