Digital games market could be worth $53B by 2016

A study by research firm found the market for digital games--which are played on the PC, console or mobile phone--could double in the next five years.

"Angry Birds" is spearheading the growth in digital games. Rovio

Is there anywhere Angry Birds won't go?

Research firm Ovum doesn't think so, and expects hits such as Angry Birds to drive growth in the digital gaming market. The firm predicts that the market, which comprises any online games played on the PC, console, or smartphone, will double over the next five years to $53 billion.

The market for mobile gaming alone is expected to triple to $17.5 billion by 2016, Ovum said.

"With the addition of more and more casual gamers, the market is no longer the sole preserve of the teen male hardcore gamer," said Ovum analyst Mark Little. "Gaming is fast establishing itself with a much wider mainstream audience, with serious ramifications for other rich-media entertainment such as TV, video and music."

Just take "Call of Duty: Modern Warfare 3," which launched this week amid massive fanfare and a blockbuster film-like marketing campaign. Gamers are expected to flood the virtual battlefield to fight it out, as well as pay for premium Elite offerings that provide advantages and additional services.

Activision, which publishes Modern Warfare 3, is expected to bolster sales with additional downloads and maps, for a price.

"Game publishers' evolving strategy is turning game products into game services, extending product life with downloadable content that continually refreshes a title's ability to engage the gamer," Little said.

The online bonuses typically yield higher margins than the game itself, he added.

On the mobile side, developers are expanding the market by offering games that can be played for free, offering up incentives, new levels and upgrades as premium products. The free-to-play model has driven further adoption as more casual gamers use their smartphones as entertainment devices.

About the author

Roger Cheng is the executive editor in charge of breaking news for CNET News. Prior to this, he was on the telecommunications beat and wrote for Dow Jones Newswires and The Wall Street Journal for nearly a decade. He's a devoted Trojan alum and Los Angeles Lakers fan.


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