Network now...NEWS
Research: Xbox Live to Generate $1b Annually
"Micosoft’s Xbox Live service will clearly lead" competitors Sony and Nintendo in the online console gaming space, generating over $1 billion in online revenues annually by 2013, according to the latest research from In-Stat.
The projection includes subscriptions, download revenue and online advertising.
In July 2008, Microsoft said that people had spent $1 billion on Xbox Live since the Xbox 360's launch in 2006.
In-Stat said Thursday that all three console hardware makers are "positioned to generate hundreds of millions of dollars in annual online gaming revenue."
What's helping drive this growth is a rise in broadband penetration--worldwide broadband subscriptions will reach 562 million in 2009, In-Stat said. "The combination of broadband, installed home networks, and pervasive Wi-Fi in gaming devices is fueling online gaming subscriber growth."
The research firm said that online gaming subscribers (handheld and console, not including PC) will increase 20 percent between 2005 and 2013, as unit sales of consoles decline. In-Stat's Stephanie Ethier stated, “Unit sales of game consoles will decline moving into 2010, as a result of both the weak economy and a peak in each vendor’s video game console lifecycle.
"The key vendors, including Microsoft, Sony and Nintendo, are staking out their online strategy to generate incremental revenue and promote brand loyalty.”
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Copyright 2006 - 2009 Future Publishing Limited, Beauford Court 30 Monmouth Street Bath, UK BA1 2BW
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Kris Graft the autor of this article, Rob Crossley, Colin Campbell and Edge Online’s entire editorial team has essentially quit.
Welcome to Alex Wiltshire and Tom Ivan.
ChesterP,
I'm assuming you are an EDGE employee in some type of management position? It seems that this type of information wouldn't be necessarily appropriate to share with readers unless it was in a news story of its own, was sensitive to the ex-employees, and granted them the respect they deserve. Throwing that up in a random post in a story that has nothing to do with it seems a bit unprofessional. Unless of course, you are not an EDGE employee which would make perfect sense. So to me, this information has no credibility whatsoever and tells me nothing of the staff members current position with EDGE nor their means of departure (if they are in fact not with EDGE anymore).
If this is true, and the poster was permitted to reveal this information in such a manner, I'm hugely dissapointed.
Interesting, I wonder if the tone of the news coverage will change?
Maybe Graft and Campbell will start the Xbox fanboy site they've clearly always dreamed of. Crossley seemed like a level-headed enough fellow.
Interesting that with the change the story upon which we're commenting seems to have disappeared from the chronological history of old stories on the front page.
I think I want to add these links to point out what is going now!
http://news.softpedia.com/news/Microsoft-Lost-7-Billion-on-Xbox-and-MSN-...
http://www.theinquirer.net/inquirer/news/173/1018173/xbox-lost-microsoft...
Two articles from 2005? Honestly mate, where do you dig this shit up?
wow the 3d reich marketing team is at it agin!
Take In-Stat's predictions with a grain of salt:
Despite Competitors' Gains, In-Stat Expects Sony to Lead Game Consoles Through 2010
Besides, who is foolish enough to make bold, long-term predictions about trends in consumer spending with the economy in its current state? And who is foolish enough to then take those predictions and turn them into front page banner headline "news?"
Nothing to see here, move along.
As noted in the article, Xbox Live made $1b in a year and a half. Why is it foolish to believe that it could generate that much in one year, four years from now? And if you didn't notice, games have been highly recession resistant, DLC and digital distribution are on an upward trajectory, and small-ticket XBLA games, add-ons and video content aren't something that cash-strapped consumers are cutting back on, despite the economy.
And just because the economy is uncertain, do you believe that research firms should just shut down and wait until everything is A-OK before offering forecasts to investors and entertainment firms?
In your eagerness to call other people out on "foolishness," I don't think you really thought out your own points.
I saw all that, I know all that; it's just that I disagree.
DLC will grow as a category but as more and more becomes available the pricing will drop off while customers will become more and more prudent and cautious as a function of time, regardless of the economy. And while DLC will likely thrive, XBL Video Marketplace not so much. Of course, this is all just based on my own anecdotal observations, not on the kind of fancy "research" that helped the wizards at In-Stat get their similarly bold predictions about console market shares so thoroughly backwards.
And yes, I do believe that the wiser among research firms have not just an incentive but a responsibility to tone down these giddy prognostications during such uncertain times, and that a smart investor will take such bold claims with a grain of salt, even coming from firms and analysts with track records far better than In-Stat's.
Then there's the tenor of the coverage. And for how many days in a row HAS that headline been the first and biggest on your page, anyway?
because it's micro soft!
Sadly this revenue is mostly due to the 360s pay to play online service. Its getting harder and harder for Xbox fans to justify paying for online when the competition has all the same features and even surpasses in some areas ex web browser, 60 p matches, lag free dedicated servers for all exclusives Home , I have recently purchased an Xbox 360 Elite for some of there AMAZING exclusives and have found that I was seriously dissapointed with the online service of such big exclusives as Halo3 and gears 2 which have consistent lag and trouble connecting online. I have never had any of these problems with PS3 exclusives such as warhawk R1 and R2 KZ2 it seems to me that this should not be the case givin that its completely free, Microsoft should have amazing online exspecially with its MAJOR exclusives and paid online. yet alas it doesnt so my question to everyone and even myself is what exactly are we paying for?
@rydamike,
Lag has nothing to do with the console in the instances you speak of or their respective network offerings. I happen to own both consoles as well and the issues you speak of are quite common with popular games with such high volume of players. Its sad to say but people cheat all the time and a common method is lag (i.e. lag switch etc.) another possibility is network congestion which fluctuates throughout the day. Halo 3 and Gears 1-2 are notorious for hosting these breed of players and its something that can't be avoided. These issues are prevalent in both consoles in my opinion and less so in the ps3 because there really isn't as many people on that network as there are on xbox live. Until software companies start imbeding code that restricts or even boots players with extreme ping fluctuations, the problem will persist. As far as what you pay for on xbox live well thats simple: Uniform multiplayer format, Video/Voice conferencing, in-game as well as out-of game text chat, multi-player party system (eliminates having to listen to smart ass comments pre-post game), social networking profiles, player filtering, player reporting (for cheating and other forms of harassment). The list goes on and on, not to mention all the extra content that is available for download and streaming video from netflix. All of these features require alot of people to make the experience work and 50 bucks a year harldy seems like a lot when you take that into consideration. Now a web browser and 60 player matches and a flawed (home) social networking system hardly seems to compare. I have both and I totally see what my yearly fees pay for when I compare the two because there is no comparison.
Concerning devilman539's post, I'll just say "Ditto ! ! !"
All Gaming is Good Gaming!
Mark 4RE............................................................................................
You actually only pay for uniform multiplayer format and in the vast majority of instances P2P multiplayer services, everything is available to you without a fee. That of course completely free on other platforms, including Windows Live. I dunno about you but I'd rather spend that money on actual games and activating something that should be free at the point of use.
Let me correct my non-proof read post:
You actually only pay for uniform multiplayer format and in the vast majority of instances P2P multiplayer services, everything is available to you without a fee. All the services you pay for on XBOX LIVE are of course completely free on other platforms, including Windows Live. I dunno about you but I'd rather spend that money on actual games than activating something that should be free at the point of use.
Exactly.
You must be on crazy pills. Years later, the PS3 network is a complete mess, with nearly every game having a different infrastructure and with simple things like live chat, proper matchmaking and even inviting people on your friend's list to join your lobby being either obtuse or non-existent depending on the game. Everyone I know always chooses the 360 version of the multi-platform titles because trying to play on PSN is a completely needless hassle. If PS3 created a "pay to play online service" that was half as reliable as Xbox Live, I would buy it on a second.
ARE YOU KIDDING ? wut a joke try playing ANY of xbox major releases its sometimes impossible to even get online everyone KNOWS gears 1 and 2 online is completely broken yet these are Microsofts MAJOR releases and you pay to play it wuts the excuse? have you even played Sonys online offerings the fact is when you compare exclusives Sonys online far surpasses Microsofts when it comes to lag and reliability and even sheer numbers of ppl playing together this is a FACT I can name many PS3 exclusives with 32 or more players that are completely lag free how many Xbox games can do that name some please oh wait there is none.
I've been playing Gears 2 multiplayer since the game was launched and am yet to encounter any serious problems. There are some minor issues with the balance, but the same goes for virtually all newly released multiplayer games out there, and, as I understand, Epic are on track to get the issues fixed.
Oh, and btw, I live in Russia, so my connection is a steaming pile of shit compared to the US broadband ones. Maybe just my luck ;)))
Gears 2 had some matchmaking issues, but was far from being "unplayable" online. I played Horde mode several times the first week without issue.
By contrast, SOCOM was literally unplayable until over a month after it hit retail. Most major PS3 online game releases have suffered a plethora of issues ranging from just annoying to literally unplayable. Add in the awful voice quality on PS3 (in the rare instance someone actually uses it) and lack of standardized community features across the entire platform (segmented game library/user base due to trickle of features and poor adoption when they do come out) and there is no question which service is better for those who like online gaming.
I agree that live is usually pretty solid. But ironically enough it crashed (at least for me and about 8 other people) last night while playing Halo 3. But, the Mythic maps came out yesterday and there were about 500k people on Halo 3 alone last night, that with all the people downloading the maps the servers were probably buckling under all the weight. My buddies and I last night couldn't get but maybe 3 matches going after about 10:30 or so. Halo will do that to you from time to time. ^^
and yet none of you have yet to directly answer me.I guess that settles it then.
What's up ryda? So, your question was what do we pay extra for for live? I think grognard and the other guy kinda answered it indirectly by listing the available community/online/multiplayer features the 360 has standard across the board that are mandatory that the PS3 lacks. That's what you're paying for.
It'd be interesting to see how much of this would be made up of the online multiplayer activation fee that 360 user have to pay to play online.
Based on the rough number of Gold subscribers indicated to date (upper 50% range of total users) we can extrapolate that roughly 40% of revenue, to date, came from those fees. It's probably a safe bet to assume that percentage will remain about the same as the user base continues to climb with each passing year. When you look at news releases from companies like Harmonix, Epic and Activision it's not hard to believe MS sold about $600 million last year from the marketplace.
There is absolutely no question MS completely dominates the online console space and that they get more revenue from this market (even excluding Gold fees) than both Sony and Nintendo combined. Considering the pathetic performance of their competition so far, I see no reason why this would change over the next few years.
Multipleyer activation fee?! ...Eh?
Well that's what the Gold fee essentially boils down too.
Oh, if only Kim_Naroz were still with us. Do you know now many capitalized words this would get? *sniffle*
Nope that is definitely In-Stas's comment:
http://www.instat.com/press.asp?ID=2497&sku=IN0904503ID
Although I can't say I have heard of In-Stat before!
"Micosoft’s Xbox Live service will clearly lead"
Kris,
I know you mentioned that the above quote was from In-Stat, but no where in the story did it contain that quote. Just to be clear, that was not MS' claim that they will "clearly lead..." correct?
This is correct. In the original In-Stat press release: http://www.instat.com/press.asp?ID=2497&sku=IN0904503ID
Microsoft’s Xbox Live service will clearly lead, with projected revenue of over $1 billion in revenue annually by 2013.
Having an analyst make that claim, is a very favorable feather in Microsoft's cap. I do not expect them to blare that over the airwaves to the consumer, but you know it is something they are going to be thumping their chest with when they meet with 3rd parties and advertisers in negotiations for exclusive content.
Having an analyst make that claim, is a very favorable feather in Microsoft's cap.
Not to anyone with half a brain and the capacity for critical thinking.
Well that excludes you then.
Oh, Nick! What a barb in my side!
Thought you'd like that. You know I love you Dubs.
Well played, that man.