While the enthusiast gaming market is somewhat stagnant, the casual gaming market is on a spurt, growing 20 percent each year. Casual games are smaller and cheaper to develop than blockbusters like Halo, but also less lucrative. However, while the profits from casual games appear smaller, their low development costs and potentially high profit margins also provide a better opportunity for startups.
“Casual gaming” is loosely defined as anything easy to learn that doesn’t require a big time commitment, like Solitaire, Bejeweled or Diner Dash. Games like those have 200 million active players, and pull in $2.25 billion yearly, according to a new Casual Gaming Association report.
By contrast, enthusiast games — the Halos and World of Warcrafts of the world — have an audience of 20 million, but manage to pull in a cool $20 billion. Yet the report, issued today, suggests that casual gaming might have the most growth potential for companies.
Pinning down exactly who receives the profits from casual gaming is difficult. While Microsoft’s famed Solitaire franchise is the most played casual game ever, with more than 400 million people having spent time shuffling their own cards, Microsoft didn’t directly profit — the game is simply a long-running perk for owners of Windows computers. Free play is typically considered a cornerstone of the casual gaming market.
Yet there are a handful of gaming portals that do profit, and account for most of those billions of dollars, including AOL Games, Club Penguin, MSN Games, China’s QQ, and Yahoo Games.
Although some money comes in from advertising on gaming sites, there are other revenue models. PopCap, for instance, distributes Bejeweled for free on PCs, but sells the game on mobile phones. Other companies allow free play on the website but charge for downloads, limit the number of levels that can be played without paying, charge for multi-player versions or sell subscriptions.
Last week, we sat down with Robert Norton, the new VP of business development at King.com, to talk about how his company is approaching growth in the market.
King.com makes much of its money from “skill games” on its own site like Cartoon Shootout, which charge players small amounts (often around a dollar) to play in tournaments against others. King.com also powers games for Yahoo, RealNetworks and NBC, among others, and just opened a new site called MyGame.
However, Norton says that in the future, players will begin to embed games on their own pages, whether that’s a Facebook profile or a personal webpage, and that casual games will become much more personalized.
Imagine uploading a picture of yourself into a game and then playing your own character, as JibJab does with its video series “Starring You”, which places a picture of your head on various dancing cartoons. It may sound silly, but Norton says the actual implementation is more clever, and well disposed to virally spreading through social networks.
Of course, professional development is still a sought-after commodity for these companies. Kongregate, home to Desktop Tower Defense, the latest casual gaming craze, has been collecting independent developers. King.com’s new site, MyGame, also seeks to recruit skilled developers, along with reaching out to users to create some content of their own.
Although Yahoo Games is the 40 pound gorilla of the casual gaming market, these companies seem to believe that players will slowly move away from casual gaming portals, and towards some of the newer ideas they’re betting on.
A final opportunity is in broadening the group that actually pays to play. Although casual game players are evenly distributed through the population, women account for 74% of all paying players, just as young males dominate the hardcore gaming market. Both segments of the gaming industry would like to move into each other’s paying base.
For more on an upcoming casual game site, check out our post on Metaplace.
12:00 am
Casual Games Worth $2.25B — But Where Are They Going? « GigaOM said:
[...] mistake potential for actual money on the table. Chris Morrison over at VentureBeat does a good job separating the two by comparing the scope of casual gamers to enthusiasts (a market that rings up [...]
10:54 am
October 31, 2007 | next media update said:
[...] Casual Gaming Worth $2.25 billion, and Growing Fast VENTUREBEAT While the enthusiast gaming market is somewhat stagnant, the casual gaming market is on a spurt, growing 20 percent each year. Casual games are smaller and cheaper to develop than blockbusters like Halo, but also less lucrative. However, while the profits from casual games appear smaller, their low development costs and potentially high profit margins also provide a better opportunity for startups. “Casual gaming” is loosely defined as anything easy to learn that doesn’t require a big time commitment, like Solitaire, Bejeweled or Diner Dash. Games like those have 200 million active players, and pull in $2.25 billion yearly, according to a new Casual Gaming Association report. Source> [...]
11:10 am
Mark Evans » Blog Archive » When’s the Apple iGame Coming? said:
[...] GigaOm and Venture Beat take a look at the $2.25-billion casual gaming [...]
2:32 am
uVme Casual Games » Blog Archive » Casual Games Worth $2.25B — But Where Are They Going? said:
[...] mistake potential for actual money on the table. Chris Morrison over at VentureBeat does a good job separating the two by comparing the scope of casual gamers to enthusiasts (a market that rings up [...]
3:24 am
WildBlueSkies » At $2.25 Billion, There’s Nothing Casual About It said:
[...] 51.7 percent, respectively, though 74 percent of people who pay to play casual games are women. As VentureBeat mentions, even though the enthusiast gaming market at a staggering $20 billion, clearly outperforms [...]
4:26 pm
In Search of the Casual « Ghost Razor said:
[...] at the casual game space for several years prior - and understandably - as the current industry is valued at approximately 2.25 billion dollars and rapidly increasing. You know what I think would be great? If every time people talked about [...]
9:17 pm
VentureBeat » Moola, a simple but addictive gaming site, launching tomorrow said:
[...] gaming is an increasingly lucrative market for designers, as we reported recently. It’s an exciting industry for designers and entrepreneurs, because the most addictive and [...]
9:17 pm
VentureBeat » Moola, a simple but addictive gaming site, launching tomorrow said:
[...] gaming is an increasingly lucrative market for designers, as we reported recently. It’s an exciting industry for designers and entrepreneurs, because the most addictive and [...]
9:17 pm
VentureBeat » Moola, a simple but addictive gaming site, launching tomorrow said:
[...] gaming is an increasingly lucrative market for designers, as we reported recently. It’s an exciting industry for designers and entrepreneurs, because the most addictive and [...]
9:17 pm
VentureBeat » Moola, a simple but addictive gaming site, launching tomorrow said:
[...] gaming is an increasingly lucrative market for designers, as we reported recently. It’s an exciting industry for designers and entrepreneurs, because the most addictive and [...]
2:00 pm
Casual Games=Engaged Players « SpotXchange’s Blog said:
[...] Venture Beat writer Chris Morrison addressed some of the future technologies ahead in the space, including [...]
4:23 am
VentureBeat » Time sinks: Four startups talk about how to make casual gaming work (and waste time) said:
[...] me; still, I’ve only managed to scratch the surface. Casual gaming is growing, bigtime. As I reported in October, the industry recently hit $2.25 billion in yearly revenues, and it’s expanding 20 percent [...]
2:07 pm
Business, casual gaming « Executive Summary said:
[...] growing market - Casual gaming is worth $2.2bn, and growing fast - growth rate estimated at [...]
2:08 pm
citypixel.com blog » Blog Archive » Business, casual gaming said:
[...] growing market - Casual gaming is worth $2.2bn, and growing fast - growth rate estimated at [...]
4:42 pm
Updated: Video game sales grow 34 percent in February, PS 3 stays ahead of Xbox 360 » VentureBeat said:
[...] don’t even include strong growth in areas such as PC massively multiplayer online games, casual games and mobile [...]
1:33 pm
Casual Games: The Bottom Line - GigaOM said:
[...] casual games market is booming, generating over $2.25 billion in yearly revenue despite virtually no brick-and-mortar representation or advertising and marketing costs. But is [...]
3:42 am
Virtual Paris 2007 » 2008 » mai » 14 said:
[...] marché des casual games est en pleine explosion (cf. Casual gaming worth $2.25 billion, and growing fast) [...]
9:27 am
Industry Creative Gets Game On | Cold Hard Flash: Flash Animation News, Videos and Links said:
[...] games.” That’s a smart move in today’s climate - where casual games have become a billion dollar market. Some are already predicting a casual gaming backlash, but with the type of creativity on display [...]