Surging adoption of internet and social networks, including social networking websites and smartphones with connectivity to social networks, has driven revenue higher over the period
Los Angeles, California (PRWEB) November 29, 2011
The Social Network Game Development industry will continue to grow quickly over the five years to 2016, albeit at a slower rate than the previous five years, according to latest industry report from IBISWorld, the nation’s largest publisher of industry market research. Revenue is expected to increase 24.4% annually to $11.3 billion as social networking websites expand their user bases, new markets embrace social gaming, more smartphones are sold with social gaming options and disposable income rises. For this reason, industry research firm IBISWorld has added a report on the Social Network Game Development industry to its growing Electronic & Online Entertainment report collection.
The Social Network Game industry is expanding quickly, having started in 2007. According to IBISWorld analyst, Nikoleta Panteva, revenue is anticipated to grow an astounding 409.9% annually to $3.8 billion in the five years to 2011. “Surging adoption of internet and social networks, including social networking websites and smartphones with connectivity to social networks, has driven revenue higher over the period,” says Panteva. Despite the recession, the Social Network Game industry grew out of an increase in leisure time as the unemployed played social network games to fill their days. To further their gaming experience, consumers purchased virtual currency, which is a method of unlocking game features for enhanced playability. Since these purchases do not make significant dents in disposable income and are small compared with buying a video game system from an electronic store, consumers bought virtual currency to pass the time.
The emergence of new markets that have embraced social gaming has stimulated the industry's growth benefiting companies like Zynga Inc., Electronic Arts Inc., The Walt Disney Company and CrowdStar, who dominate the industry. Zynga is the largest social network game developer in the world and owns familiar brands including; FarmVille, CityVille, FrontierVille, PetVille, Empires & Allies, Café World, Mafia Wars, Texas Hold'Em Poker, Words With Friends and Hanging With Friends. Social networks, and the technology that accompanies them, have placed gaming within reach for the average computer user. As such, consumers that have not played video games before joined in on the games at accelerating rates. Women over 40 represent the fastest growing segment, since these consumers easily started to participate in social games and become regular users. This trend will continue to benefit industry revenue during 2011 as women over 40 continue to join, and new market segments embrace social gaming. Industry revenue is expected to grow 31.5% from 2010 to 2011.
Unfortunately, the industry will ease off the gas over the next five years. Social networks are stepping up their game and charging more for virtual currency transactions, eating into industry costs. Because social networks are hosting these games, they are looking to generate more revenue because of the interest in social gaming. Nonetheless, several beneficial trends will keep the industry growing quickly, albeit at a slower rate than during the current five-year period. The surge in smartphone popularity and internet connections will continue, connecting more people to social games and networks. Disposable income is also set to rise, which will result in more virtual currency purchases. As a result of these trends, IBISWorld projects that revenue in the Social Network Gaming Industry will rise 24.4% annually to $11.3 billion in the five years to 2016.
For more information, including latest trends, statistics, analysis and market share information, download the full report from IBISWorld on the Social Network Game industry
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