The total value of all public games companies worldwide is approximately $105 billion, according to investment banker Paul Heydon from Avista Partners.
Speaking at the Edinburgh Interactive Festival yesterday, Heydon (who claims to have advised on $1 billion worth of videogame deals for the likes of Unity, Atari and Criterion) felt that previous market estimates did not wholly account for the ballooning online sector.
This, he argued, contributed $23.46 billion to the worth of the games industry – 71 per cent of console and PC gaming's (excluding Nintendo) value of $33.22 billion. However, he pegged the total market cap of public companies creating Nintendo software as $34.96 billion.
Further exploring business trends, Heydon claimed that the online game and virtual world market now constitutes over 260 dedicated companies spanning the casual and hardcore poles, generating over $13.8bn in annual revenue. 44 of these companies were public, and only three of them were based in the West.
Online companies had, according to his figures, enjoyed over $4 billion in investment from online companies to date.
2008 was the record high for VC funding to date, amounting to $1.2 billion - but this halved to $633.5 million last year. However, he felt online game companies would attract over $900 million in investment by the end of 2010.
Heydon also predicted over $2 billion in acquisition deals for online game companies by the end this year, observing that there had been $868.9 million worth of buy-outs in Q3 alone.
By contrast, the third quarter of 2009 had seen just $20.5 million in acquisitions. The ongoing rise of online gaming had, he claimed, harmed more traditional games companies, estimating around $55.3bn in "total value destruction" for boxed games companies since 2007.
Avista's complete breakdown of the worth of the global games market is as follows:
- Nintendo: $34,959m
- Other PC/Console (excluding Nintendo): $33,223m
- Online: $23,457m
- Mobile: $8,257m
- Retail: $3,110m
- Payment Services: $1,368m
- Distribution/Accessories: $311m
- Outsourcing: $255m
Slides and more statistics from Heydon's presentation are available here.