Online Console Video Game Sales Expected to Pass Packaged Sales in 2019
DFC Intelligence just released its latest global video game console market forecast. This included initial estimates for console systems expected to launch in 2020 and beyond. Of course, one of the biggest issues is the growing digital delivery of software on console systems. DFC Intelligence forecasts that revenue from digital delivery of console software will pass sales of packaged software in 2019.
The movement to digital delivery has been a gradual evolution of the industry. Packaged sales and digital delivery were almost equal in 2018. In 2019, 53% of the forecasted $24 billion in revenue is expected to be from digital sales. By 2023 that number is expected to increase to 65%.
The good news is that much of this move to digital is additive in terms of overall revenue. Packaged revenue is expected to remain fairly steady while digital revenue increases. Furthermore, much of the digital revenue will still be sold at retail in the form of prepaid cards.
Saying that sales will be moving from packaged to digital does not really explain the whole story. Therefore DFC is expanding its forecasting categories throughout 2019. You can see our overview of some of these changes in this article.
The main goal is to focus on the total addressable market (TAM) in any given segment. Some segments will be more suited for specific products. There are different distribution and business model considerations that need to be considered. DFC’s goal is to cover both the business model/platform and distribution issues as well as forecast the expected market size.
Despite its long-predicted demise, the console market is expected to grow to record levels over the next five years. DFC Intelligence forecasts sales for both video game console hardware and software to reach $47 billion in 2022. This is up 67% over 2016.
Surprisingly this is in conjunction with expected growth in the core PC game market. There is an important crossover demographic between PC and console games that is just now coming to its strongest fruition.
Overall it is an exciting time because business models will be changing. This means a potential shakeup among the established players. It also creates significant opportunities for savvy newcomers. Stay tuned!