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Subscription revenue drops for online games

Falls five per cent between 2009 and 2010, but microtransactions are on the rise

Figures reported by Screen Digest show that subscriber revenue from online games fell in 2010, a first for the industry.

"The 2010 decline in subscription revenue - the first annual contraction experienced by the market since our coverage of this segment started in 2002 - represents an inflection point for the industry," said Piers Harding‐Rolls, senior analyst.

In 2010 online multiplayer games generated $1.53 billion in North America and Europe, a fall of five per cent from $1.66 billion in 2009.

Screen Digest predicts a long term drop in subscriptions, falling to $1.33 billion by 2015.

"The focus of many PC game operators has clearly shifted to microtransaction‐based models - in part due to competition in the subscription market especially in the high‐end MMOG segment, but also because of the flexibility microtransactions offer operators in monetising gamers."

Microtransactions in the same global regions rose by 24.2 per cent, from $909 million to $1.13 billion in 2010.

Total revenue among Western online multiplayer games, including subscriptions and microtransactions rose by 5.3 per cent, from $2.57 billion to $2.7 billion for the same period.

Screen Digest forecasts microtransaction revenue to continue upwards reaching $1.8 billion by 2015.

The study also distinguishes between MMOGs, massively multiplayer online games like World Of Warcraft, and MOGs, non‐massive multiplayer online games like Moshi Monsters.

"MOGs continue to rise in popularity with operators because they can cover a wider range of game genres than MMOGs, are generally less expensive to produce than full‐blown MMOGs and are also being increasingly successfully monetised by the industry," said Harding‐Rolls.

The report can be read in full at the official Screen Digest site.

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Latest comments (1)

Rather interesting that many people that I talk to in MMOGs hate the idea of micro-transactions yet people have moved in that direction. Doubt that it will be the "new wave of the future" but I'm curious if it will bring about more micro-trans games rather than subscription.
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