Casual gamers leaving dedicated handheld market

Sony and Nintendo struggling in the face of mobile and tablet gaming

A recent survey by analysts Cowen and Company shows that casual gamers have abandoned traditional handheld devices, with only 26 per cent playing on a Nintendo DS, 3DS or a Sony PSP.

"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," states the report.

"We believe cellphone and smartphone gaming is significantly impacting demand for dedicated handheld devices."

Only 37 per cent of those surveyed played games on a dedicated handheld device, while 52 per cent played on their phone.

"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."

The full report also suggested while consoles were holding up well against more casual gaming models, "there is a substantial gap between the average prices that our respondents were willing to pay and prevailing hardware retail price points." It suggests a price cut would help to boost sales and the console market.

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Latest comments (15)

Christopher Lee Designer 10 years ago
The only thing Sony and Nintendo have left going for their handhelds is their first party software.. I don't think in a few years the high powered Vita and the fancy 3DS display will be enough to keep gamers from using a piece of hardware that does, well, everything. I can't carry around a Vita, 3DS, and an iPhone in my pocket. But I do need a phone!
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John Polson Managing Editor, DIYGamer10 years ago
Shouldn't people be leaving the PSP and DS especially? These are really old pieces of hardware. Were there ever a lot of casual gamers on the PSP? It didn't seem marketed as such a device to begin with.

The market needed something like the Vita a while ago: touch and innovative rear touch screen and a solid solution to avoid those awkward virtual controls. The Vita may not go in my pocket, but I'd like it on my nightstand.
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Jim Webb Executive Editor/Community Director, E-mpire Ltd. Co.10 years ago
Dedicated game consoles will always have a market. When will the industry understand this?

Changes in the demographics at one end of the spectrum doesn't mean the entire spectrum is following suit.

Stop chasing analytics that don't tell the whole story.
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Show all comments (15)
Nick Parker Consultant 10 years ago
There is no doubt that dedicated handheld games devices are losing their relevance among a group of casual gamers who are gaining satisfaction for a similar experience on their mobiles/tablets. The handheld market will drift younger and less affluent except for a few games executions. There needs to be more features on the handhelds to persuade some gamers to carry more than one mobile device.
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Christopher Bowen Editor in Chief, Gaming Bus10 years ago
Jim, the problem is that perception is reality. If investors see that analytics - hard numbers - that prove something, then they will go with that. They don't care. They just want money, and eventually, it becomes a self-fulfilling prophecy. See: Nintendo's issues because they won't succumb to mobile.
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Greg Wilcox Creator, Destroy All Fanboys! 10 years ago
Chris: Nintendo's "issues" were trying to convince millions that *3D!* was the sole reason for buying into their new handheld. It wasn't.

As for the mobile argument, just because something is POPULAR, it sure as shit doesn't mean it's GOOD. As the market tries to appease speculators and non-core gamers, it's also losing its focus and forgetting the FACT that the market has and CAN continue to support multiple platforms no matter what some analysts (who, by the way are being PAID to write stuff that makes investors tingle) say.

Sure, tablets, phones and other devices are huge and snapped up by the skrillions who've never gamed or are moving on into sheeple territory at a rapid pace. But there are a LOT of terrible things happening to elements like controls, longevity of certain titles and a few other things you can still get in a dedicated console or handheld experience.

Also, battery life and the ability to OWN a physical product, not rely on a digital delivery system (that can fail or be compromised) is a big deal for me in a handheld. I'm not happy with a mere 3-5 hours of play on anything, but it seems that those millions aren't even concerned because they know no better and will accept anything that comes down the pike as just fine. As for security, we're in for a big kick in the balls when the first big hack hits whatever set-top box or next-gen all-in-one wonder device is the biggest seller that turns into a useless brick after a hack or two.
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Bruce Everiss Marketing Consultant 10 years ago
The advantage of phones is that they are always there. Also the dedicated mobile gaming devices can't compete against half a million apps.
Phones aren't just taking business from the dedicated mobile gaming devices, they are also taking it away from static devices like PCs and consoles.
In terms of hours spent mobile phone gaming is already almost certainly bigger than all other forms of gaming put together. And it is still just at its very beginning, the growth potential is outstanding.
Also remember that next generation smartphones, coming soon, with have 4 core CPUs and 8 core GPUs, giving them the power of a PS3.
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Jim Webb Executive Editor/Community Director, E-mpire Ltd. Co.10 years ago
Bruce, don't buy into the "power of the PS3" marketing nonsense. We've still got a ways to go before we hit that point.

And yet it is still irrelevant. It's not the power of the dedicated consoles that keeps them relevant, it's the experience they offer. And the experience is what a game developer is selling. When a developer has an experience to sell, they research which platform will be most capable of providing that experience. Smart phones, no matter how powerful, do not provide the dedicated console experience.

Your company makes smartphone apps and that a viable market to target. But the experiences you as a team decide to make are not the same ones that a full scale console developer would develop.

Better stated, I don't buy a smartphone to play console games no more than I buy a console to play smartphone apps. And I don't think I'm alone in that sentiment.
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David Radd Senior Editor, IndustryGamers10 years ago
More people have smartphones than ever before. Portable gaming is so often a thing of convenience, not the best sort of gaming experience possible. Because of the huge install base for these phones, the cheapness of the games and the fact that people tend to take their phones with them everywhere, that trumps other considerations for the portable gaming sphere.
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But how hard would it be for Nintendo to add a mobile phone to their next handheld console? To me, that's an easy sell to the consumer.
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Omaha Sternberg Editor / Co-Founder, iGame Radio10 years ago
The advantage of phones is that they are always there.

That's what was said about the PC market...every household had a computer, so that's what would keep the PC gaming market dominant in the face of the rising console market. Didn't happen. Just because it's always there doesn't mean it's what people will always want to satisfy that gaming desire. There will always be a variety of hardware devices that people will want to game on. Nintendo's problem, I agree, was relying on some silly 3D nonsense, rather than recognizing that the more relevant their handheld is to the needs of the people who are buying it, the more will pick it up.
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Reza Ghavami Marketing Analyst, NVIDIA10 years ago
I will have to postpone my exodus. I prefer gaming over tapping pets or birds in anticipation of a micropurchase prompt.
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Bret Mogilefsky Director, Developer Services and Support Group, Sony Computer Entertainment America10 years ago
"A recent survey by analysts Cowen and Company shows that casual gamers have abandoned traditional handheld devices, with only 26 per cent playing on a Nintendo DS, 3DS or a Sony PSP. "

"abandoned" implies that 100% of the people being surveyed are formerly players of DS/3DS/PSP... Is that really the case, or is this actually about the percentage dropping due to the market expanding as the number of people with smartphones goes dramatically up? (In other words, market share shrinking, but market overall hugely expanding.) Those would be two very different takeaways from the survey.

Rachel, can you please fix the link in the article so we can read your reference ourselves?
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Lewis Pulsipher Game Designer, Author, Teacher 10 years ago
Jakob Nielsen frequently says "killing time is the killer app" for mobile. You don't need "an experience" to kill time. Convenience is a big part of killing time. This is why phones will predominate and dedicated handhelds will become a much smaller market. Those who want "an experience" will use something much larger and more capable (especially in the screen) than a handheld.
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Greg Wilcox Creator, Destroy All Fanboys! 10 years ago
@Bret: My gawd, SOMEONE finally gets it!

The FACT here is there are indeed MILLIONS of NEWER casual users to mobile gaming platforms that have NEVER owned a handheld gaming system or may have been "fair weather" (casual) users of a platform like the DS or PSP. I'd even go as far as saying this crowd would be MORE likely to be previous DS or GameBoy system owners based on the more casual aspect of a great deal of the software for those games. I can't think of anyone I know with a PSP that's a purely "casual" player, but I can think of a lot of them who've owned a GB/GBC/GBA or something in the DS family.

These people probably don't touch "core" games for any number of reasons, but they sure as shit get counted as numbers whenever some analyst or developer preening about how mobile will kill off dedicated platforms needs to tally up some figures.

The market CAN support BOTH casual and core gamers and games simply because the core know they can't get as solid an OVERALL experience on ANY touch-screen only device. Sure, a good deal of you here are having fun with those iOS and other toys. But come on, now... you can't tell me that enforcing "evolution" and losing the pad or stick is the BEST thing for gaming. You're kidding yourself if you are, so cut it out already, suck it up and support the core before you drive us all away. I finally played Infinity Blade a few days ago and I wasn't pleased that much. It looks absolutely GREAT, but it's about as deep as a laserdisc game form the early 90's...
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