News
Prepaid Game Cards to reach $495MM by 2014E
New York – For online entertainment, prepaid game cards are maturing and have become a leading alternative payment method, says SuperData Research.
In its Prepaid Game Card Primer, SuperData maps out the current market landscape and assesses the buying behavior of digital consumers. According to lead analyst Joost van Dreunen, “offering customers the right mix of payment methods directly affects the bottom line for digitally distributed entertainment.” The recent launch of a prepaid card by Zynga and a similar announcement by Facebook underwrite the monetization potential.
The study builds on over 250,000 prepaid card transactions collected from 15 online entertainment publishers, including virtual worlds, MMOs and social networking games, as well as a custom panel of 3,152 respondents.
Among the key drivers for prepaid game card adoption, SuperData points to the recent 2009 Credit Card Act, which limits access to credit cards by changing the minimum age for card holders from 18 to 21 years old. The growth of prepaid game cards has been nothing short of explosive, growing 48% YoY in 2009, according to the study. Many North-American consumers are already familiar with retail-based cards, as it dovetails with the estimated $100 billion annually gift card market. SuperData’s study further indicates that both consumers and game publishers appreciate the transparency and safety prepaid game cards offer, avoiding hidden fees and charge backs.
“Instead of using prepaid game cards as just another payment method, it presents a real monetization opportunity,” according to van Dreunen, but “understanding the industry’s incentive structure is critical.”
For the full report, please visit: http://www.superdataresearch.com/prepaid-game-card
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Digital Distribution for Game Software Expected to Reach $7.7bn by 2012E
For Immediate Release
New York, NY – As mainstream publishers and hardware manufacturers are stepping up their efforts on the digital distribution for games software, the overall market is showing a promising increase.
With the Free2Play model slowly reaching maturity, other gaming venues are also beginning to see the benefits of distributing content digitally. At a recent analyst briefing, Nintendo president Satoru Iwata expressed interest in the Kindle’s business model. “I’m interested because it’s a new business model in which the user doesn’t bear the communications cost,” Iwata said.
Similarly, Sony’s recently released PSP go relies on WiFi to download content for the device. Brick-and-mortar retailers have done little to promote the handheld, since they traditionally make only a small margin on hardware and rely mostly on software sales. The chasm between traditional retail and digital distribution, in other words, is set to grow wider as major players investigate the space.
According to SuperData’s managing director, Joost van Dreunen, “Digital distribution also lowers entry barriers in emerging markets, side-steps conventional piracy issues, and allows for a higher degree of up-selling. Particularly as broadband penetration continues to roll out, digital distribution will play a huge part in how consumers access content.”
About SuperData Research, Inc.
SuperData is comprised of a network of industry experts and researchers. We all work in the industries that we write about, but feel that research can sometimes take too long to become available or is just plain too expensive. So we do it ourselves, and publish it here for cheap.
SuperData’s report, Digital Software Forecast 2005-2012E, is available for purchase here.
