PC Game Sales - Bad To Worse

[Phil_Stein]

http://www.thestreet.com/_yahoo/stoc...FREE&cm_ite=NA

U.S. Retail PC Game Sales

2002 $1.4 Billion
2003 $1.22 Billion
2004 $1.08 Billion

The article only goes back to 2002, but I believe the peak was actually in 2000, and there have been 4 consecutive declines in PC game sales. Germany, the #2 PC game market in the world, has also seen substantial sales declines.

[DeepT]

PC games are DOOMED!!1!!1!!!

[MikeTwain]

Hey, if you had listened to my advice about RRT3--you know, the stuff about the tricked out combat trains with guns lances doing a train joust--then you could have made the extra 392 million all by yourself.

:twisted:

[Charles]

Those stats are skewed by the fact that a large amount of the titles which come out for PC nowadays also come out on console.

[Thrrrpptt!]

Originally Posted by Charles

Those stats are skewed by the fact that a large amount of the titles which come out for PC nowadays also come out on console.

Eh? How is that skewing the numbers? Skewing implies some kind of error in the data so that they don't represent reality. Cross-platform games are actually a real example of why PC game sales might be declining.

[Reed]

But how many of those were PC games to being with? Typically they are console games ported to PC.

[Thrrrpptt!]

Doesn't matter. Sales are sales. It would only be skewed if, for example, sales of console-to-PC ports weren't included in the numbers. I doubt that's the case.

[Chris Nahr]

The article doesn't consider MMORPG revenues, so that genre might be doing just fine. Non-MMO PC games seem to be DOMED indeed, though.

It almost doesn't matter whether console-to-PC ports are included in the figures, by the way. The article says PC games have dropped to a whopping 15% of total video game sales... original PC games have virtually vanished in either case.

[Nellie]

Does it take into account the relative rise of the MMORPG?

why splash out £30 a week/month etc on new games when you can buy WoW or SWG or Eve or Planetside etc once for £30 and carry on playng it at £10 a month for 6 months+ instead.

I buy far fewer games when I have an active sub to any MMORPG.

[edit] norty boss delaying my post by those crucial 7 minutes.

[Phil_Stein]

It's retail sales only. So, it misses MMORPG revenues and the downloadable/web game market (Bejeweled, etc.), which is small but growing (especially among women 40+)

My speculation as to the reasons for the decline:

1) Rise of console games, which consumers are preferring for many reasons, including that they're easy to run (no driver fiddling, minimal crashes, etc.), generally, easier to learn, require a lesser hardware investment, and support rentals.

2) Bad consumer experiences trying to install 3D games. The downtrend in PC game sales started roughly when hardware 3D acceleration really took over (ca. '00). For casual consumers, knowing what to buy, what drivers to install, etc. is a nightmare. 2D games, by and large didn't have this problem. Plus, to play a high-end 3D game, you need a 'gaming PC', or at least to add a good 3D card to your $700 HP/Dell. This was not the case for 2D games, and puts up a high barrier to entry.

3) PC game piracy has probably increased over the last 5 years. This is more of a factor overseas, but is still significant in the U.S.

4) MMORPGs - suck the time and dollars from gamers, away from retail. If you subscribe to 2 MMORPGs, you're likely buying fewer retail games.

5) General market focus on console games. With console game sales at several multiples of PC game sales, the media and public focus on them, and developers/publishers target them. In '98-'99, it was common for mass media (i.e. Wired, Newsweek, etc.) to write about PC games, now it's rare. PC games are getting lost in the shuffle.

6) Lack of a breakout new genre. The Sims phenomenon never really evolved into a true genre - just lots of Sims expansions, but no competing games capturing the sales magic. RTS and FPS are showing their age as genres, appealing to the hard core, but bringing in few new users. A breakout new genre would help PC games, but I don't know what that genre might be.

[Thrrrpptt!]

Originally Posted by Christoph Nahr

The article doesn't consider MMORPG revenues, so that genre might be doing just fine.

Ah, that is a good point. A few of those are money mills. MMORPGs aren't going to stay on the PC, though (c.f., FF Online)

original PC games have virtually vanished in either case.

2004 was a huge year for original PC games. Half-Life 2, Doom 3, Rome: Total War, WoW, Pirates!, Warhammer, The Sims 2. Probably others I can't think okf off the top of my head.

[Mark Asher]

I think MMOs do have an impact, explaining some of the lost revenue going into MMO monthly fees. I am also much more unlikely to buy other PC games when I'm actively play an MMO.

Still, I don't think MMOs can account for all of the decline. I expect it to get worse as fewer PC games are made and more of them are cross platform games.

[Dave Long]

The Best Buy here in Reading is definitely heading to a smaller PC section once their inventory period is over. It looks like that space will be given to console games.

--Dave

[Rob_Merritt]

Originally Posted by Phil_Stein

http://www.thestreet.com/_yahoo/stoc...FREE&cm_ite=NA

U.S. Retail PC Game Sales

2002 $1.4 Billion
2003 $1.22 Billion
2004 $1.08 Billion

The article only goes back to 2002, but I believe the peak was actually in 2000, and there have been 4 consecutive declines in PC game sales. Germany, the #2 PC game market in the world, has also seen substantial sales declines.

I'm actually surprised it broke 1 billion this year. I knew they were way down the first half of the year. Guess the trio of Doom 3, Half Life 2, and World of Warcraft really helped. Here is the numbers I have for the past 10 years.

year/ total income / 1994 dollars
1994 ~ 966 million 966 million
1995 ~1.4 billion 1.36 billion
1996 1.7 billion 1.6 billion
1997 1.8 billion 1.66 billion
1998 1.8 billion 1.64 billion
1999 1.9 billion 1.73 billion
2000 ~1.6 billion 1.38 billion
2001 1.75 billion 1.47 billion
2002 1.4 billion 1.15 billion
2003 1.2 billion 959 million
2004 1.08 billion 791 million

Also don't forget the average cost of game development has grown from 1 million to 10 million. Though some AAA have 30 million + budgets.

There isn't a way to paint a pretty picture.

refs: (some dead links)
http://news.com.com/2009-1001-228291-2.html
http://www.redherring.com/mag/issue43/overview.html
http://www.gamesdomain.com/gdreview/e398/idsa.html
http://www.idsa.com/releases/4-21-2000.html
http://www.pcvsconsole.com/news/news...=1159&filter=4
http://www.tdctrade.com/mne/toy/020302.htm
http://www.digitalgamedeveloper.com/...lidsa12803.htm
http://press.releases.filefront.com/25
http://www.npdtechworld.com/techServ...content_id=720
http://www.redherring.com/mag/issue43/march.html
http://money.cnn.com/2002/07/10/comm...column_gaming/
http://www.newsengin.com/neFreeTools...=30&Expand=1#1

[Dave Long]

Now you know why Adam @ Sierra was telling us game prices must go up. Gotta gouge those who still buy and support PC gaming so the budgets don't drop and the games continue to get made.

--Dave

[Rob_Merritt]

Originally Posted by Phil_Stein

My speculation as to the reasons for the decline:

Here is my two cents..

The platform has suffered without a cheerleader. Microsoft doesn't care if you game on the Windows platform anymore. They are too busy courting people for Xbox and NextBox. Even at Microsoft own booths at E3 and CES, you have to hunt for pc games. Without someone promoting a platform, it whithers and dies. No one is courting and working with developers, no one is going into stores making sure PC games aren't getting shoved into the corner next to the used Dreamcast games, and no one is advertising that the best games are on the PC (even if it isn't true, if you aren't preaching it, it isn't going to happen).

[MikeTwain]

Originally Posted by Dave Long

The Best Buy here in Reading is definitely heading to a smaller PC section once their inventory period is over. It looks like that space will be given to console games.

--Dave

Yeah well they're hardly going to turn the space over to Gamecube titles man.

" :D "

(Now see what you've made me do Dave? I would never have even considered getting on your case before your snarky "Stop Posting" gif comment.)

[Thrrrpptt!]

Originally Posted by Dave Long

Now you know why Adam @ Sierra was telling us game prices must go up. Gotta gouge those who still buy and support PC gaming so the budgets don't drop and the games continue to get made.

So you're saying that buying PC games is kind of like tipping strippers? You're just enabling a career choice that ultimately goes nowhere?

[Chris Nahr]

Originally Posted by Thrrrpptt!

2004 was a huge year for original PC games. Half-Life 2, Doom 3, Rome: Total War, WoW, Pirates!, Warhammer, The Sims 2. Probably others I can't think okf off the top of my head.

That's true, and I bought a bunch of those as well, but how do you square that with the ridiculously low 15% figure? Assuming it's not just made up I'd have to assume that those big titles were the only ones that sold any number of copies, and all the remaining titles rot on the shelves.

[Kitsune]

I think PC gaming will always be like reading books compared to something like going to the movies and as such will always have a healthy enough market to keep going, but sometimes its going to look like the sky is falling, like it always does in the book industry when you look at the figures. I know a six, seven and an eight year old respectively who play (again, respectively) Neverwinter Nights, Call of Duty and Empire Earth. (I should mention there are American kids from American families when I lived there and this whole analogy obviously ignores where I live, because in Japan bookstores outnumber theaters and video stores--I just seemed to notice that reading didn't seem to be a terribly appealing activity a lot of Americans.)

Also, a question, do these figures include all the shareware-type games, services like Stardock and sales through Steam?

-Kitsune

[Case]

Originally Posted by Rob_Merritt

The platform has suffered without a cheerleader. Microsoft doesn't care if you game on the Windows platform anymore. They are too busy courting people for Xbox and NextBox. Even at Microsoft own booths at E3 and CES, you have to hunt for pc games. Without someone promoting a platform, it whithers and dies. No one is courting and working with developers, no one is going into stores making sure PC games aren't getting shoved into the corner next to the used Dreamcast games, and no one is advertising that the best games are on the PC (even if it isn't true, if you aren't preaching it, it isn't going to happen).

I think we'll see an increasing emphasis on PC games from Redmond this year. Look at Age of Empires III -- they're pulling out all the stops on that one.

[Supertanker]

Originally Posted by Phil_Stein

1) Rise of console games, which consumers are preferring for many reasons, including that they're easy to run (no driver fiddling, minimal crashes, etc.), generally, easier to learn, require a lesser hardware investment, and support rentals.

2) Bad consumer experiences trying to install 3D games. The downtrend in PC game sales started roughly when hardware 3D acceleration really took over (ca. '00). For casual consumers, knowing what to buy, what drivers to install, etc. is a nightmare. 2D games, by and large didn't have this problem. Plus, to play a high-end 3D game, you need a 'gaming PC', or at least to add a good 3D card to your $700 HP/Dell. This was not the case for 2D games, and puts up a high barrier to entry.

I think the combination of these two is the main problem. All of the people that used to ask me about PC games and how to upgrade their PCs now just buy an Xbox or a PS2. Typical computer users have always been hesitant to tackle the technical issues, and now a console lets them avoid it completely.

[Thrrrpptt!]

Originally Posted by Christoph Nahr

That's true, and I bought a bunch of those as well, but how do you square that with the ridiculously low 15% figure? Assuming it's not just made up I'd have to assume that those big titles were the only ones that sold any number of copies, and all the remaining titles rot on the shelves.

Whether PC game sales are dropping overall and whether original PC titles "have virtually vanished" are two different questions. I was just making the point that in 2004 there were a number of big budget, blockbuster PC games so the latter isn't true. Like you, though, I also suspect that these titles accounted for a lot of the PC game sales (though we know that the original The Sims and its various expansions squatted at the top of sales charts all through the year).

[Dave Long]

I'll also always stand by the opinion that Xbox has taken a large swath of its consumer base from former PC gamers. I really don't think there were that many new gamers this generation. I think there were a lot that moved from the PC platform to the console platform.

--Dave

[RickH]

Originally Posted by Phil_Stein

It's retail sales only. So, it misses MMORPG revenues and the downloadable/web game market (Bejeweled, etc.), which is small but growing (especially among women 40+)

My speculation as to the reasons for the decline:

1) Rise of console games, which consumers are preferring for many reasons, including that they're easy to run (no driver fiddling, minimal crashes, etc.), generally, easier to learn, require a lesser hardware investment, and support rentals.

2) Bad consumer experiences trying to install 3D games. The downtrend in PC game sales started roughly when hardware 3D acceleration really took over (ca. '00). For casual consumers, knowing what to buy, what drivers to install, etc. is a nightmare. 2D games, by and large didn't have this problem. Plus, to play a high-end 3D game, you need a 'gaming PC', or at least to add a good 3D card to your $700 HP/Dell. This was not the case for 2D games, and puts up a high barrier to entry.

3) PC game piracy has probably increased over the last 5 years. This is more of a factor overseas, but is still significant in the U.S.

4) MMORPGs - suck the time and dollars from gamers, away from retail. If you subscribe to 2 MMORPGs, you're likely buying fewer retail games.

5) General market focus on console games. With console game sales at several multiples of PC game sales, the media and public focus on them, and developers/publishers target them. In '98-'99, it was common for mass media (i.e. Wired, Newsweek, etc.) to write about PC games, now it's rare. PC games are getting lost in the shuffle.

6) Lack of a breakout new genre. The Sims phenomenon never really evolved into a true genre - just lots of Sims expansions, but no competing games capturing the sales magic. RTS and FPS are showing their age as genres, appealing to the hard core, but bringing in few new users. A breakout new genre would help PC games, but I don't know what that genre might be.

I think you nailed it with 1, 2 & 5. I'm not convinced the same customers for Doom 3 & HL2 are MMORPG players, but I could very well be wrong. Wouldn't be surprised if WoW has a great deal of crossover/1st timer appeal, though.

#1 also should include the easy sellability & standardized packaging of the console title. The retailer that buys or trades games from the general public knows exactly what is being sold, check for scratches and that's it. The PC game industry screws itself by resisting standardized & non-disposable packaging to this day. Will I get a jewel case, a cardboard case, or paper sleeves? Buy it and find out, chump!

#2 is dead on. I know folks who bought a PC game that wouldn't play on their system; it went on the shelf and they never bought one again. The shitty Intel 3D chip commonly found in budget PC's has gone a long way towards killing PC gaming. When a mid-range 3D card costs as much as an Xbox, all but the enthusiast and hobbyist market is eliminated.

#3 is pure speculation. I've yet to see any study that tracks consumer behavior with regard to piracy vs. purchase. If piracy was truly suppressing sales, then Scrapland, which has yet to be warezed, should be selling demonstrably better than a similarly-situated title.

#5 why shouldn't the market focus on console games? The retail channel knows that the average PC game will result in X number of "it won't run on my machine" returns (or attempted returns, anyway). The easy availability of the post-release patch has made the PC gaming industry lazy and complacent about quality. That's driving customers and retailers to the easy to sell & support console market.

Then there's the social aspect. Consoles are plugged into the TV, which usually occupies a place of honor in the high-traffic area of the home. PC's are off in another room, with smaller displays, ususally played in isolation. Consoles are social, PC's aren't.

[unbongwah]

Originally Posted by Kitsune

Also, a question, do these figures include all the shareware-type games, services like Stardock and sales through Steam?

I believe NPD, the source for these numbers, only tracks sales of retail copies - no online-only sales like Steam and Stardock and no MMOG revenue (beyond what's sold at retail). And I'm not even sure they track all retailers.

To be honest, until someone figures out how to accurately track these alternate revenue streams, I'm unwilling to get too concerned about PC gaming. Yeah, PC gaming's roughly half what it used to be 5 years ago at retail; yeah, console games are crowding PC games out of B&M stores; and yeah, a lot of worthy games get utterly buried in the marketplace because no one takes notice of them.

But when an industry makes over a billion dollars a year, that's still a lot of money. Toss in the moolah for online-only sales and MMOG fees and you've got a serious pile of cash. Yeah, PC gaming's not the dominant force in the marketplace - so? We got lots of great games last year; and it looks like we'll get lots of great games this year, too. As long as companies can still have blockbuster hits on the PC, I'm convinced they'll continue trying to tap into that market.

[mouselock]

Originally Posted by Phil_Stein

So, it misses MMORPG revenues and the downloadable/web game market (Bejeweled, etc.), which is small but growing (especially among women 40+)

...

6) Lack of a breakout new genre. The Sims phenomenon never really evolved into a true genre - just lots of Sims expansions, but no competing games capturing the sales magic. RTS and FPS are showing their age as genres, appealing to the hard core, but bringing in few new users. A breakout new genre would help PC games, but I don't know what that genre might be.

I think you've answered your own question here. There are two new breakout genres, and both circumvent retail heavy sales chains to generate revenue. I think the MMO stuff will saturate reasonably quickly because of time investment (although god save us if someone comes up with a game that can unlink the time invested = progress mechanism and still remain compelling as a game), and the web-type games are really the up and coming mechanism?

Aside from hardware/ease of running concerns on platforms, I think one thing that doesn't get noticed a lot is the ease of play issues. Nobody reads instruction books for console games. In general, introductory tutorials are pretty quick and to the point. They're designed to be popped in and played, in a sort of round-robin fashion, by not only the purchaser (hardcore gamers like us here) but also whoever drops by (probably more casual).

I still think one of the reasons the sims was so huge was that the game mechanics were absurdly simple. You could sit down, click around a bit, and *poof* you knew how to play the game. This is a reasonably large rarity in PC gaming space. It's a lot more prevalent in console space. However, consoles are starting to span the range to complex gameplay. PC games, however (at least the boxed variety) aren't going back the other way in return. That's why I think you're seeing web games taking off.

There's just simply got to be a larger market out there for people who'd sit down and play a game for 20 minutes than those who'd sit and play one for 200. PC games traditionally cater to the latter crowd, while consoles aim far toward the former. And those 20 minute games are the "gateway games" to more complex stuff, but if all the loyalty is already built up from playing 20 minute games on the XBox, who's going to bother looking anywhere but the XBox section for the 200 minute games?

[mouselock]

Originally Posted by Dave Long

Now you know why Adam @ Sierra was telling us game prices must go up. Gotta gouge those who still buy and support PC gaming so the budgets don't drop and the games continue to get made.

--Dave

I'd actually prefer to see game makers focus on trying to figure out whether or not there's a way to make new games, rather than bigger, stronger, faster version of last year's game (with a new name, a new, shinier engine, etc..)

Is there really any creativity left in the PC space? I don't want to touch off the whole PC vs. Console flamewar again, but there seem to be more attempts to do different things on the console. Or more publically visible ones. I think the PC game section is so closed these days they've blocked out any avenue for fresh ideas to be presented to the mass public, and it's come back to bite them in the ass.

(i.e. Where's my full 3D version of Twinsen's Odyssey, dammit? :P )

Originally Posted by Phil_Stein

U.S. Retail PC Game Sales

2002 $1.4 Billion
2003 $1.22 Billion
2004 $1.08 Billion

The article only goes back to 2002, but I believe the peak was actually in 2000, and there have been 4 consecutive declines in PC game sales. Germany, the #2 PC game market in the world, has also seen substantial sales declines.

Could it be a simple thing like: "Fewer PC games are being made and sold?"

I only know what's reported above, so this is just speculation. But I do remember an economic example where they showed how an industry could show a "loss" in overall sales while also showing a rise in "profit." Meaning, if the industry makes fewer PC games this year compared to last, you're going to see a loss of overall sales - but that doesn't necessarily mean the companies who put out the games lost profit on the one's they did release.

How many copies does an A-list big game sell now compared with 2000? Are those numbers down?

[noun]

Could it be a simple thing like: "Fewer PC games are being made and sold?"

Sold maybe, not made. How many titles came out in Q3-Q4 last year? 100? Who can afford to buy that many games? Who has the free time to PLAY that many games?