BROADBAND CUSTOMERS OF CABLE TV AND PHONE COMPANIESRESIDENTIAL DSL RESIDENTIAL CABLE TOTALU.S. Subscribers 4.45 million 8.99 million 13.44 millionCanada Subscribers 1.14 million 1.78 million 2.92 millionTotal North AmericaSubscribersNorth America Q2Added SubscribersNorth AmericanMarket Share5.59 million 10.77 million 16.36 million502,005 1.01 million 1.51 million34.17% 65.83% 100.00%Source: Kinetic Strategies, Sept. 2002These early numbers, however, are probably not terriblysignificant.The much bigger issue is whether online videogames will develop into a mass-market business or merelya nice, tidy niche market.Analysts lean toward the latter,predicting that online gaming won’t really take off until atleast 2005, when the next, even more advanced generationof console boxes is expected to start rolling offassembly lines.Wargo, for example, forecasts that onlyabout 12 million video gamers will go online by the endof 2006.Analysts pin the blame for this on low broadband penetrationand little interest and awareness among most videogamers. Olhava notes that it could take years to educateconsumers about online gaming’s benefits, just as it tookyears to educate the public about the benefits of VCRs,satellite TV dishes, CD players and most other new technologicalproducts. She also notes that the console and softwaremakers still must work out their business models forthe service.As stated above, Sony is starting out by offeringonline play for free, while both Microsoft and Nintendo willbe charging extra for their network adapters.PC WILL STILL TRUMP VIDEO INONLINE PLAYMuch of online gaming’s success, of course, depends uponthe quality of the online video games that Sony, Microsoft,Nintendo and the independent game developers design forthis new medium.The three platform providers and themajor independent developers busily are all creating andpumping out games with new online capabilities and features.But, as in the offline world, analysts don’t see toomany online games running on all platforms, primarilybecause Sony and Microsoft steadfastly will keep their platformsproprietary.“Sony would never, ever allow its gamesto be played on Xbox,” says IDC’s Olhava.“Nor wouldMicrosoft (allow its games to be played on PlayStation 2).”No matter what happens, video-game online play willundoubtedly trail way behind online play by PC gamers.Roughly 10 million of the 20 million or so PC gamers payfor Web-based games now, as opposed to a small handfulof the 45 million video console owners. But the gap maybe even several times larger than that. Estimates are thatup to 58 million of the nation’s 60 million-plus computerowners will play either free or pay-for-play games on theInternet by the close of 2002, easily dwarfing the potentialvideo-game market for online games.COMPARISON OF ONLINE PC ANDVIDEO PLAYERSPLATFORM # OF GAME # OF ONLINEOWNERS GAMERSVideo GameConsoles 45 million 0HomeComputers 15-20 million 10 millionSource: CEA Market Research, Sept. 2002.ELECTRONIC GAMING HITS THE ROADAlong with the growing adoption of broadband and thelaunch of online video games, another major trend in electronicentertainment is the increasing portability of gameplay.Thanks to a new generation of smart mobile phones,Web-enabled PDAs, handheld game consoles, MP3 playersand laptop, notebook and other small but powerful computers,players are gaining the ability to tap into their favoritegames from multiple points of access. In other words,mobile devices have started making it possible for gamersto leave their video-game consoles and desktop PCs athome and play anywhere they happen to be, as long as theyhave a dependable online connection.26 OCTOBER 2002 5 Technologies to Watch
REVENUE PROJECTIONS FOR GLOBALWIRELESS GAMING (U.S. dollars)ANALYST FIRM PROJECTED YEARREVENUESIn-Stat/MDR $2.8 billion 2006Ovum $4.4 billion 2006Frost & Sullivan $9.3 billion 2008Source: www.80211planet.com compilation of research forecasts,Aug. 2002.Hailing wireless games as “the next Internet gold mine forentrepreneurs,” Datamonitor forecasts that an impressive200 million people in the U.S. and Europe will be playingmobile games by 2005. Revenue projections, though, are allover the board. Frost & Sullivan projects that the globalmobile game industry, which produced $436.4 million inrevenue in 2001, will generate $9.34 billion by 2008. Ovumsees global mobile game revenue climbing to $4.4 billion by2006. Finally, In-Stat/MDR expects global wireless gamingrevenue to reach $2.8 billion by 2006.THE GAMES PEOPLE PLAYAmong other things, what all these moves mean is that it’sa great time to be a developer of game titles.The explosivecombination of better, nearly three-dimensional graphics,broadband enhancements, online capabilities, multiplayergames, mobile gaming and stiffer competition among thethree main video-game platforms puts game makers in theA DOZEN WAYS TO ESCAPE ELECTRONICALLYGAME CATEGORYDESCRIPTIONFirst-Person Shooter Players look out from behind the eyes of the character. Objective: Seek out anddestroy. Ex.: Quake, Doom and Unreal.Third-Person ShooterAdventureRole-playingArcadeGamblingFamilyFightingDriving SimulationFlight SimulationSportsStrategyPlayers view the game from the side or the rear of the character. Main objectivehere also is to ‘shoot-em-up’. Ex.: Max Payne.Player must complete a series of tasks while venturing through a make-believeworld. Played primarily from the rear third-person perspective. Ex.: Myst, TombRaider, Mario and Crash Bandicoot.Gamers play with one or multiple characters to carry out quests or missions.Objective is to enhance the skills and levels of the character. Ex. Diablo II,Everquest and Asheron’s Call.These games have a simple interface and objective. Generally, they are twodimensional.Examples include all the classic arcade games, such as Frogger,Asteroids, Pac Man and Final Fantasy.Primarily an online category of game. Includes Slots, BlackJack and Poker.Games with an educational and/or family-oriented theme. Ex.: Monopoly, Rugratsand Who Wants To Be A Millionaire.Players fight against others in boxing, martial arts or wrestling matches.Ex.: Tekken III, Mortal Kombat and WWF Smackdown.Player controls a vehicle usually from behind the wheel. Ex.: Crazy Taxi andGran Turismo.Player flies a plane or spacecraft from the behind the pilot’s seat. Ex.: FlightSimulator and Mig 29.Games centered on a sport, such as football, basketball or hockey. Ex.: NFL 2K1and NHL Face Off.Games played from a god’s perspective. Players control resources to buildcivilizations and/or troops to conquer the world. Ex.: Civilization, Age of Empiresand The Sims.5 Technologies to Watch OCTOBER 2002 27