No recession here: NPD says U.S. gaming industry in good health

  • Chicago (IL) - The U.S. gaming industry appears not only alive and well, but also recession resistant. Even as we await a new batch of games to kick console sales into a higher gear -- like the eagerly-awaited Resident Evil 5, we are still buying more games in 2009. And now a new trend is being seen, we are increasingly using our consoles for more online game play.

    The gaming industry has just reached a milestone: One in four online gamers are from the console world. This is in stark contrast to just a few years ago when online console-based game play was practically non-existent. Now the next milestone of online game evolution rests squarely on the developers and publishers who need to focus on multi-platform games where challenges face each other online in the same game, even if on different platforms.

    While the sales of console hardware and games are traditionally slower during January and February, several big game releases in Japan this past week have kicked the industry into a higher gear and reversed that trend (see our previous coverage.) As expected, Killzone 2 is leading the pack with 750,000 copies sold around the world during the first week, while Resident Evil 5 became a system-seller for both Xbox 360 and PS3, with 350,000 copies sold in Japan over past weekend. While we wait for the Resident Evil 5 to hit the U.S. shores this coming Friday, a new report by the market research firm NPD Group (released yesterday) shows encouraging stats when it comes to online console game play.

    According to the NPD survey conducted by polling a 20,000 gamers panel, a growing number of U.S. teenagers are playing more and more online games on their consoles. While consoles are great for gaming, they have not traditionally been a favorite for online play. Now, this is changing.

    According to NPD stats, online gaming for consoles and portable devices has contributed to one quarter (25 percent) of the total overall video game market in early 2009, up from 19 percent a year ago. NPD also noted that the industry seems "recession resistant" -- as the number of online players who bought at least one console game has risen a bit compared with 2008 (when the recession had not yet hit).

    Xbox 360 remains the most popular console for online gaming with half of respondents saying it's their online console of choice. "This is a testament to the strength of Xbox 360, both overall, and particularly in the online gaming sphere," NPD said in the report. Xbox 360 is followed by Wii (29 percent) and PS3 (21 percent).

    Teens dig online gaming

    It's interesting that a much broader demographic now enjoys online games compared to the typically younger audience max that characterizes non-online games. NPD explains this by "sheer variety of content and ease of access," meaning it makes online gaming "attractive to a much larger demographic than what we typically see in retail." However, it appears that teens are also digging online games at a more rapid pace than older players who are playing less. Around 22 percent of polled online gamers in 2009 are aged 13 to 17, up 5 percent (from 17 percent) in 2008.

    Consoles finally get to grips with online play

    The results of NPD's survey are a sharp departure from trends from previous years that have been traditionally inclined towards online gamers on desktop PCs, with only a fraction coming from consoles. In a way, the fact that one quarter of online gamers now come from the console world should be considered a major milestone.

    Although the current generation of consoles from Microsoft, Sony and Nintendo all feature online support and expose this functionality to game developers, it took programmers a while to bring games focused on online play to bear -- as is usual on the PC gaming market. Microsoft's Xbox 360 is currently best equipped for online play, although we should note that the first-generation Xbox console actually introduced the console world to online play with Xbox Live service that came built-in to the system software, while PS2 and GameCube lacked system-wide online gaming support.

    Square's Final Fantasy XI has been the first MMORPG that enabled console and desktop gamers to meet each other in the same virtual world, on the same servers, thanks to Square's propriatory Play Online service.

    Conclusion: It's all on developers now

    While the technology is finally there, game makers are still playing catch up as console games still predominantly feature scripted single-player gaming modes. While only a small portion of console games enable online play, their number is on the rise. It's certainly encouraging that several publishers are now bringing games which enable online play across platforms -- meaning you could be playing the same game on your console versus your online opponent who is playing it on a desktop PC.

    For example, SquareSoft's Final Fantasy XI was the first MMORPG that brought multi-platform online play, enabling console and Windows PC owners to play together on the same servers via the Square's proprietary PlayOnline service. Cryptic Studios' sci-fi MMORPG Star Trek Online, scheduled for arrival sometime in 2009, is also rumored to enable console and desktop players to challenge each other in the same game, on the same servers.

    While multi-platform-enabled online games are still found in trace quantities, the important thing here is that it's finally getting somewhere. Eventually, online console gaming will match desktops, quite possibly with this current generation of consoles. And I say:  The sooner, the better.

    While technologies that enable online play are finally there in current-generation consoles, publishers need to make more multi-platform online games. Although one in four online gamers come from consoles (with half of them being Xbox owners), the figure still needs to go up. Pictured above is a scene from the upcoming sci-fi MMORPG Star Trek Online which is rumored to enable online play across desktop PCs and consoles.