Analyst: Mobile, Social Revenue To Drive Industry In 2010

Emerging platforms like mobile, online and social games will generate almost 40 percent of all content revenue for the game industry in 2010, says Lazard analyst Colin Sebastian. Although analysts like Wedbush Morgan's Michael Pachter are expecting a software sales rebound in 2010, Sebastian isn't expecting much of one -- with sales "flattish" when console software price declines are factors in. However, the analyst notes "a significant opportunity for growth outside of the traditional console and handheld markets," adding: "We note that monetization of video game content online is increasingly driven by the sale of virtual goods, a market itself that could eclipse a billion dollars in 2011." "The emergence of smart phones and social networking sites as key platforms driving growth further complicates matters for publishers geared toward the traditional console cycle," warns the analyst. As a result of this migration, Sebastian predicts "legacy" publishers will continue investigating the social gaming space as Electronic Arts has done with its acquisition of Playfish.