Amid yesterday's news that gaming sales went into the toilet thanks to a weak gaming lineup mixed with depressed consumer sentiment -- we see analysts try to break it down for what all this might mean today. First up is Zacks:
"In the present scenario, with the changing dynamics of the gaming industry, consumer spending on mobile games and social networking games are gaining tremendous popularity. We believe publishing companies having an exposure in these segments would be benefited in the long run.
To drive home the advantage of the popularity, Electronic Arts had bought PopCap Games, which is one of the largest social gaming companies with over 150 million games that are played on various platforms such as Facebook, RenRen, Google Inc.’s (GOOG - Analyst Report) Android, Apple Inc.’s (AAPL - Analyst Report) iPhone, iPad and also on the web. We believe that other publishers would follow soon.
We also believe that digitalization of the games would be a major revenue earner for the publishing companies."
To drive home the advantage of the popularity, Electronic Arts had bought PopCap Games, which is one of the largest social gaming companies with over 150 million games that are played on various platforms such as Facebook, RenRen, Google Inc.’s (GOOG - Analyst Report) Android, Apple Inc.’s (AAPL - Analyst Report) iPhone, iPad and also on the web. We believe that other publishers would follow soon.
We also believe that digitalization of the games would be a major revenue earner for the publishing companies."
For those who don't want to read the entire report (which is quite short regardless), analysts conclude that the gaming industry is weak and August should see sales fall by 30% or more as well. The industry will get a turn upwards with big box retail games hitting soon -- but the physical disk based business seems to be suffering right now. The $60 price tags and lack of quality titles definitely has worked against gaming publishers this summer.
It's definitely something we've got to keep an eye on, because the last time the gaming industry went through this type of a slump we lost several long running and quality titles. While most current titles are now on firmer footing (the weak ones were already eliminated), there are still several titles which are intended to be franchises which could be scrapped (EA Sports MMA being one notable example).
We'll be keeping an eye on this.
I don't think it is just the lack of how good the games are. It's just this nation and the world has Money troubles right now and people are losing their jobs left and right. So that is hurting not just the gaming business, but alot of other businesses aswell. Since we are the end of this current Gen. Consoles. I'm sure the prices of games will start coming down some to help boost the sales if this slump keeps happening. But overall the whole world is hurting right now some way or another money wise.
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