Blog Post

My 2008 Gaming and Online Worlds Predictions

As 2007 draws to a close, here are some educated guesses for the coming year, pegged to hard numbers. (Because there’s nothing lamer than meaninglessly broad, unverifiable forecasts.)

wiithumbnail.jpg Wii Install Base Surpasses 360 and PS3 Combined

This would have very nearly been a fait accompli this holiday season, had Nintendo produced enough Wii supply to meet the unrelenting Wii demand. Analysts estimate that this shortfall cost the company more than a billion dollars, in other words, the equivalent of 4 million additional units that would have sold, had they been on shelves. There are currently about 17 million worldwide Wii owners compared with the 360’s 15 million and the PS3’s 8 million, so even current demand puts the Wii in striking range of this prediction — and there’s no reason to think that demand is even close to being satiated. Once Nintendo controls over half the next-gen market, the nichification of the 360 and PS3 will be complete, and with its wireless connectivity and web browsing features, the Wii’s preeminence as the living room PC will be assured.

gamezincrisis.jpg PS2 Continues to Outsell the PS3

This was the case last month (496,000 to 466,000, according to NPD), and given the continuing appeal of casual game franchises like Guitar Hero and Rock Band, which run just fine on Sony’s extremely economical, seven-year-old system, that’s unlikely to change. What will change is the game industry itself — companies that shift their production budgets to the PS2 and Wii will thrive, while those that pursue the much smaller and far more fickle gameboy owners of the PS3 and 360 will largely underperform. The PS2’s staying power will also slow mass adoption of HD DVD. (The PS2 plays standard DVDs just fine, too.) Sony was hoping the PS3 would leverage their Blue-ray HD standard, but in a keen irony, the ongoing success of their PS2 has undone those ambitions. (It’s not doing the 360 or for that matter, Hollywood, any favors, either.)

Total Virtual World Population by end of 2008: 75 million

The GigaOM Top 10 Most Popular MMOs from June tracked some 35 million active members, and was already in serious need of an upward revision a few months later. I’m working on one now, but if I had to hazard a rough guess, I’d say it’s approaching 50 million. (Which means it beat Gartner’s oft-cited estimate by four years.) Given the ceaseless growth, investment dollars, and new startups (especially for kid-oriented MMOs), it’s reasonable to expect that level of growth will continue next year.

Number of Casual Game/World Sites in Alexa’s Top 500 Doubles

In recent days, at least seven have been listed among the most popular sites, as measured by the Internet tracking service: (Party Poker at 165, MiniClip at 177, Neopets at 202, Gaia Online at 326, Runescape at 370, Prizee at 378, and Stardoll at 474.) With the amount of money and startups going after that space (as here, here, and here) many more are sure to join them.

Check back here in about 365 days to see which of these predictions came to pass.

Update, 1:30pm: I should open the floor to GigaOM readers– what are your gaming predictions for 2008?

Third image credit:

12 Responses to “My 2008 Gaming and Online Worlds Predictions”

  1. The Wii is an interesting experiment and real-world test case as to what it might take to create a “mainstream gaming market”. But it doesn’t exist today, and the Wii isn’t going to make one.
    There’s my prediction. Is it based on any hard or real stats? No. But that’s what we do here, isn’t it?

    I understand that you’re trying to make some broad and bold predictions, but seriously, use some accurate and RELEVANT statistics to backup your arguments.

    I think you could have a pretty strong argument here, but you’re certainly not making it. Your argument appears to be (correct me if I’m mistaken):
    3rd party developers (software/hardware/services) will base their product decisions on the number of purchased consoles.

    You don’t think that 3rd party developers use anything else?
    Attachment rates: There are SIGNIFICANT differences in attachment rates between the Wii and the 360/PS3 that you are completely ignoring.
    Audience demographics: The Wii’s broader market appeal also means that your audience has a wider array of interests. Most games won’t appeal to ALL of them, only to a subset. 360/PS3 audiences are more well-defined and easier for a developer to target.
    Game cost/unit: I confess I don’t know how much the 3rd party developer pays to each of the major console makers. I do know that Wii games sell for less (they purchased the Wii for less, they expect the games to cost less).
    Game development costs: This has to be significantly lower for a Wii-exclusive game, although I suspect that equation changes for multiplatform titles (e.g. 360/PC).
    (to name a few. Basically – how many units will we sell, how much will we spend to develop/market, and how much margin? and very importantly, how accurately can we predict this outcome?)

    In other words, there is no magic tipping point based on the number of consoles sold, because 3rd party developers are (generally) a little smarter than this.

    So – again, the Wii is doing a great job of showing the potential of mass-market game design. And the 360, while trying to make some moves in that direction, is so far doing a poor job of broadening it’s appeal (Arcade Edition? Please). But they are far from out of the game.

    In any event, I’ve done a poor job of backing up my points with real stats either. Then again, I’m not getting paid for any of this.

    I would really enjoy reading a more thoughtful and well-researched post from you on this same topic.

  2. Jim I think Wii will survive once families find services like Gamefly .

    I would never spend $40-$60 for a game that I might not like or play over a weekend but a Game in the Mail subscrption service will work .the same can be said for Console online services I would rather pay a monthy subscription where I can play a certain amount of games at a time than buying downloadable games I might only play a few times .

  3. it will be interesting to see how casual gaming platforms will create API’s for content integration within games. This could have an immense impact on the digital content (downloads) market, as games provide a strong place of engagement and emotional gain.

  4. Jim Duggan

    In the grand scheme of things console sales far from tell the story. People predicting here clearly have no sight into actual gaming culture. Everyone has a Wii, they bought it for novelty, and because it was so cheap. That wore off very quickly and people buy 1 or 2 games a year. While the 360 has massive turn around with so many great games continually coming out, the live marketplace, extra controllers, charge kits, live service fee, great online service to keep players playing etc. Everyone above is correct, the Wii is a novelty that has already worn off, sure they can sell consoles, but that’s pretty much where it ends..

  5. My Prediction for the Wii is that a Wii Ware developer will come out with a Ad supported IPTV service and add it as a Wii Channel .The Wii is a trojan horse for Internent TV convergence and it can already play YouTube Videos through the Browser .

    Problem with the Browser is most Mums and Dads are not going to browse the internet on thier TV or see the value of paying $5 for the browser if they already have a computer/s .Also the Wii Browser only supports Flash 7 because Abode wont relese the SDK for Flash 9 so goes the Kids Sites like ,Disney and Cartoon Network wont work .This also leaves out sites like HULU which would be great on the Wii.

    Flash 9 on the Wii would have many web developers creating sites specifically for the Wii and Wii Remote .

    Personaly I think the Joost Interface is perfectly suited for the Wii but it has been pointed to me by several Joost developers the Wii is too underpowered for any current versions of Joost to work,maybe they need a version of Joost that isnt so resource hungry .

  6. Unfortunately, you are insane.

    With a severe lack of quality games for the Wii (and 3rd party developers really not enjoying making games for the Wii), this Christmas will be the Wii’s last hoorah. It’s hit its peak. And quite frankly, I don’t even enjoy playing my Wii, nor do my friends who bought one in the last year. Overhyped, under-delivered.