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Video Game Industry Pins Future To Online Play

Las Vegas – While online gaming is still in its infancy, the creation of compelling interactive online entertainment is the key to the industry’s continuing strong growth into the future.

That was the message from Friday’s Gaming Supersession, where it was estimated that the video industry grew 25 percent in 2002, to approximately $10 billion, meaning that overall sales from video game hardware, software and accessories now rival that of both the movie and recorded music industries.

The panel, moderated by Creative Strategies’ Tim Bajarin, was comprised of Charles Bellfield, content VP at Sega; Andre Vrignaud, technical strategies director at Microsoft’s Xbox Live division; Alain Tascan, worldwide development VP at Bam! Entertainment, and journalist Steve Kent.

In his introductory address, Bajarin noted that an ever-widening audience was driving video game sales, with users who spend an average of one to three hours a day ‘with no commercials – and that’s significant if you come from broadcast or Hollywood.’

Vrignaud said that he expected the video game industry to enjoy a 20% growth rate for the next few years, adding that there are currently 120 million video game players worldwide.

Xbox Live, which launched Nov. 15, now sees more than 40,000 unique players a day who average 2.5 hours a day during prime time hours, he said.

While there are currently 17 Xbox Live games, the company expects more than 50 additional games to be available in 2003.

While Sony has decided to let its developers create their online gaming networks, Microsoft has chosen a walled-garden approach where all games are played within Microsoft’s environment.

Vrignaud off-handedly characterized the difference between Microsoft’s and Sony’s online strategies, saying, ‘Sony offers an adapter; Microsoft built a network.’

Bellfield offered some perspectives on Sega’s early narrowband online ventures with Dreamcast, saying it tried to establish the market ‘but unlike Microsoft, lacked the cash to pull it off.’

Online gaming, Bellfield said, ‘is a feature, not a genre. Online itself will not make a game a hit, and not all games are appropriate for online play,’ he cautioned. Bellfield also offered a more sanguine industry total dollar volume of $11 billion.

Tascan said that the typical video game cycle of three to five years means that for developers, ‘we’re reassessing the business every three, four or five years.’

Video games, he said, ‘are the most empowering forms of entertainment. With non interactive entertainment, you care; with interactive entertainment, you are.’