Video Gaming: The Next Level
I’m proud to introduce an excerpt from one of Capgemini’s most recent point of views: “Video Gaming: The Next Level”. If you are interested in downloading the whole paper, please go here. (Registration required.)
The video game industry in the U.S. grew nearly 65% from 2006-2008, driven primarily by the newest generation of gaming devices, including consoles and portables, and a proliferation of successful titles, particularly key franchises such as Grand Theft Auto, Mario and Halo.
During that span, the innovation of the Wii dominated mainstream news. Today, headlines hail the iPhone as the next growth platform in gaming. Lost, however, in the focus on game play, form factor and motion controllers is a fundamental technological transformation that will reshape the industry: the connected gaming device, which we define as a device with the ability to download and manage entertainment titles.
Today’s gaming devices all boast connectivity, from consoles that join existing home networks to portables that use Wi-Fi to Smartphones that leverage global cellular networks. The original Xbox and PlayStation 2 were the first connected consoles; their next-generation counterparts matured the offering by tapping into Web 2.0 interconnectivity similar to that of Facebook and Twitter, creating social networks of their own. Since their respective launches, Nintendo’s DS and Sony’s PSP brought Wi-Fi connectivity to the portable gaming market. Historically, games have played a minor role in the mobile phone industry. Now sophisticated games are a differentiator in Smartphones, with the iPhone leading the way while Blackberry, Android and Nokia’s N-Gage 2.0 jockey to compete. Today’s devices are at varying stages of both connectivity and monetizing from
this connectivity.This technological transformation arrives at a time when consumer behavior has become increasingly complex due to the rise of personalization and participation. Today’s consumers are increasingly interested in personalizing their gaming experience via unique avatars and user profiles. Their desire to participate with games is twofold: 1) to augment content and 2) to interact with other players. Gaming consumers seek to enhance and contribute to titles with user-generated content (i.e., skins and level editing) and developer interaction that influences the product itself. Consumers also desire to interact with each other via online gaming communities.
Maturing the connected technology will allow firms to meet the needs of this increasingly sophisticated consumer. Our View: Connectivity Changes the Game The proliferation of connected devices fundamentally changes the gaming landscape. Traditionally, consumers have purchased video games via retail outlets in boxed format. While this remains the case today for AAA titles on consoles, connectivity threatens this model.
