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Electronic Gaming Products
First Research, Sep 2009, Pages: 10
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Executive Summary
Brief Excerpt from Industry Overview Chapter:
The electronic gaming products manufacturing industry includes about 100 companies with combined annual revenue in North America of about $7 billion and worldwide sales of about $20 billion. Major companies include Microsoft, Nintendo, Sony, and Logitech. The industry is highly concentrated: the top three companies account for more than 80 percent of revenue.
Entertainment and games software and manufacturing of personal computers (PCs) used for gaming are covered in separate industry profiles.
COMPETITIVE LANDSCAPE
Demand is driven primarily by personal income. The profitability of individual companies depends on effective marketing, competitive product design, and manufacturing efficiency. Market success drives additional revenue via royalties paid by third-party game developers. The industry is capital-intensive: average annual revenue per employee is about $700,000.
Electronic gaming products compete with PCs, TV, and other forms of electronic and non-electronic entertainment for consumer leisure time.
PRODUCTS, OPERATIONS & TECHNOLOGY
Major products are video game consoles (50 percent of revenues); portable players (25 percent); and peripheral hardware (25 percent). Video game consoles are computers specially designed to deliver entertainment and game software, using a TV as a monitor. Video game console sales consist of three competing products: Sony’s PlayStation 3, Microsoft’s Xbox 360, and Nintendo’s Wii. Portable players are handheld gaming devices, like the Nintendo DS and Sony PSP (PlayStation Portable). Peripheral hardware includes devices that elevate the human-machine interaction (HMI) such as game pads, joysticks, and driving wheels. Peripherals also ...
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