Are core gamers still the route to financial success?
Cowen And Company report looks at how casual gaming is affecting the hardcore market
A new report from analysts Cowen And Company suggests that, while industry attention is focused more acutely than ever on the casual gamer, the console playing hardcore are still the fastest route to financial success.
Looking at how the increase in casual gaming on mobile and tablets might be affecting traditional console products, Cowen And Company's 2011 Video Game Survey found that only one per cent of those who considered themselves hardcore gamers had purchased fewer console games as a result.
This figure rose to just 6 per cent when the survey was expanded to include all gamers.
Of those surveyed, 78 per cent did play casual games online, which is a rise of 6 per cent from last year, while gaming on mobile devices rose. 56 per cent played games on a smartphone, a rise of 15 per cent from last year, while 34 per cent played on an iPad or Kindle, and 45 percent played on an iPod or iPod Touch.
High-quality games for the core gamer remain the best investment for publishers despite changes to the structure of the industry.Cowen And Company
"The results of our Fall 2011 Video Game Survey do not change our view that high-quality games for the core gamer remain the best investment for video game publishers despite changes to the structure of the video game industry," stated the report, authored by Doug Creutz and Jason Mueller.
The news wasn't so good for traditional handheld gaming platforms, with only 26 per cent of the casual gamers playing on a Nintendo or Sony handheld. Overall only 37 per cent of those surveyed played on a dedicated handheld device at all.
"Over the last five years, the penetration of dedicated handheld platforms into survey respondents self-identifying as casual gamers has declined by 29 per cent, with the vast majority of that decline occurring in the last two years."
Unsurprisingly the report attributes the decline to the prevalence of mobile and tablet gaming, and notes that while some publishers are using the trend to their advantage, Sony and Nintendo faced tricky times ahead.
"We do not view the decline of casual handheld gaming as a particular problem for the US publishers, as they have migrated their exposure away from dedicated handheld platforms, and in some cases (particularly EA) have invested significantly in phone and tablet platform game development. However, we do view this trend as a negative one for Sony and especially Nintendo."
Cowen And Company also predicted that only 16 per cent of those surveyed intended to purchase a Wii, a 4 per cent fall on last year, and Wii owners were also the least likely to increase their purchase of games for the console. The study identified "flagging demand" from what they call "casual and mass market" Wii owners. While the report fails to mention Nintendo's new Wii U, the promise of a new console on the horizon may well have put consumers off purchasing the Wii in the near future.
"35 per cent of Wii-only owners indicated that that they had either gotten fewer or a lot fewer games in the past year, compared with only per cent indicating that they got more new games."
In multi-console homes, only 20 per cent stated that the Wii was their main console, while PS3 also saw a low 25 per cent, and Xbox 360 took 48 per cent.
And while the the analysts see the Wii as well priced, they are hoping for a price cut for both the PS3 and Xbox 360.
"There is a substantial gap between the average prices that our respondents were willing to pay and prevailing hardware retail price points. We believe that Microsoft and Sony have left hardware unit sales on the table by not reducing price points to $199 for the primary versions of their console."
The also study points to the recent success of Call Of Duty: Modern Warfare 3 and EA Sports' output, suggesting that the success of such core titles are driving up share prices for the biggest publishers.
Surveys for the study were conducted in September across 1,300 people, randomly selected throughout the US. 1,001 of those reported that they played video games.