Investors uncertain about gaming industry’s future
Though new technologies could lead non-traditional consumers of video games to embrace new digital platforms, such as mobile and online gaming, investors are uncertain of where they fit in, Reuters reported.
The shift to digital has the potential to increase profit margins, as three-dimensional animation becomes more popular and more consumers embrace platforms that allow them to play games with a wave of their hands.
Yet investors are skeptical about the $60 billion a year global gaming industry’s ability to emerge from gaming trends in a market that is largely dominated by pastimes such as Activision Blizzard Inc.’s “Call of Duty.”
According NPD Group Inc., which tacks the industry, U.S. retail sales of traditional video game hardware and software are down 8 percent this year, but that doesn’t include digital and mobile sales in America, the industry’s largest market.
In the next year, according to John Riccitiello, CEO of Redwood City, Calif.-based Electronic Arts Inc., digital platforms are expected to account to for 50 percent of sales.
“You are either on the right side of a technology transformation or the wrong side,” Riccitello said, adding that those who fail to recognize the shift may be left behind.