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IDC: Demise of Game Consoles is Greatly Exaggerated

- By - Source : IDC

A recent study conducted by the IDC claims that the console sector will rebound early next year with the launch of Nintendo's Wii U.

Last week, the International Data Corporation essentially dismissed the notion that the console era is coming to a close despite falling revenue numbers. According to a recent study, Worldwide Game and Interactive Entertainment Console Hardware and Software 2011 -2015 Forecast (IDC #229438), the console market will reportedly begin to rebound early next year with the release of Nintendo's Wii U.

"Total console hardware and disc-based software revenues are on track to slide a few percent in 2011 compared to 2010," said Lewis Ward, research manager, Consumer Markets: Gaming, at IDC. "But prognostications that consoles have peaked as a product category are premature. I expect that the launch of the Wii U, a revamped interactive entertainment console from Microsoft in the 2014 timeframe, and the arrival of Sony's 'PS4' circa 2015 – along with more than a few exclusive, innovative games – will help drive a new wave of console-centric spending in the next several years."

The report goes on to declare that console hardware and physical (disc, SD) games will see a 3.6-percent compound annual growth rate between 2010 and 2015. The key reason for this bump is due to the growth of the console sector in developing countries. But at the same time, the proportional number of households that will actually use game consoles are expected to diminish as the world's population grows.

"IDC expects there to be about 257 million active consoles worldwide by 2015, or 12.7-percent of anticipated households that year, down about 1-percent when compared to same console penetration figure for 2011," the report reads. "In this sense, it's possible to conclude that console popularity will slip due to the rise of media tablet gaming, casual, free-to-play/social online PC games, etc."

As we saw with the debut of Nintendo's Wii U console, the very definition of "gaming console" may change over the next few years. Take OnLive's "console" as an example: it's a small, Nintendo DS-sized device sporting two USB ports, an HDMI output, a power jack, and support for a wireless controller. While it does contain firmware, the games and the processing behind those games are located on a server somewhere else. That said, physical games may still sell in the next few years, but the industry on a whole seems to be shifting over to the cloud.

With that in mind, the role of the console as we know it may indeed be coming to a close. Who knows where the market will be in 2014 and 2015? Completely cloud-based? Will the PlayStation and Xbox brands take on a more multimedia-oriented focus?

"The forecast also shows the PS3 will have the largest active installed base of any game console worldwide by 2015," the report claims. "In this sense, the PS2's 'long tail' may ultimately repeat." This in itself could be a major reason why the old-school console model will linger around for so long: because they're cheaper than the new models and still supported by dedicated developers.

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burnley14 08/24/2011 1:16 AM
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Consoles better not go the way of the cloud. I like to have my games in physical form, not constantly depending on internet. Whether that's on a DVD/CD or on my hard drive does not matter. Although honestly I foresee optical drives disappearing in the next gen of consoles (real consoles, not the WiiU). They're noisy and slow and take a ton of room inside the case. Switch to SD cards/flash drives or downloads only.

caedenv 08/24/2011 1:17 AM
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I predict that the WiiU will be ok, but not a great boost (unless there are some real games). But the X360 and PS3 are not going to last another 3-4 years before a hardware refresh. They are already way behind the times of what people expect in the high def world, and people will lose interest unless they come up with something in the next year or two.

caedenv 08/24/2011 1:18 AM
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bobusboy 08/24/2011 1:21 AM
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The Wii U will have to be amazing with out games before I even consider getting it to play games.

Anonymous 08/24/2011 1:36 AM
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alidan 08/24/2011 1:37 AM
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burnley14 :
Consoles better not go the way of the cloud. I like to have my games in physical form, not constantly depending on internet. Whether that's on a DVD/CD or on my hard drive does not matter. Although honestly I foresee optical drives disappearing in the next gen of consoles (real consoles, not the WiiU). They're noisy and slow and take a ton of room inside the case. Switch to SD cards/flash drives or downloads only.



sd/flash... yea... i'm so not paying an extra 10-40$ because a 30 cent disc is a little noisy. next gen will require bluray, minimum, to store game. i mean look at metal gear solid 4, that was 50gb, and it didn't even have the best textures everywhere in that game, and correct me if im wrong, but that was all in game right? now a 50gb download is... well... a hell of allot. and considering how much microsoft charged for hdds (100$ for 20gb) i don't want to depend on downloading games to a hdd i may not be able to replace, and comes at an extreme premium.

also, you must be a 360 gamer... as i never had any other system that was as loud as that, and as bad as that drive... EVER... my god, i had leaf blowers that were quiter, and if it was anything less than perfectly level, it ate your discs. remember the e3 showing, the mercury switch where they demoed it by tipping it on its side from vertical to horizontal with a game playing... how many people did that and had to have their disc resurfaced?

alidan 08/24/2011 1:37 AM
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caedenv :
lol, "don't go to the cloud... it is evil" but "please give us downloads instead of physical media"... don't you know what the cloud is?



when you say cloud, you think streaming
what they mean is like steam, where you download the game out right

MCFCBlue 08/24/2011 1:46 AM
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Death to the Console... and show those programers the best gamers are the PC gamers who will support (and keep them in business) with the games they release.

fball922 08/24/2011 1:54 AM
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Did anyone stop and think that maybe given the current state of the world economy that significantly fewer people are interested in spending $50-$60 on a couple hours worth of entertainment that consists of a rehash of an old game that graphically looks identical to its predecessors and simply rearranges the perk system? The industry as a whole is ready for a refresh, and hopefully the world economy will start rebounding in the next 1.5-2 years

alidan 08/24/2011 1:54 AM
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caedenv :
I predict that the WiiU will be ok, but not a great boost (unless there are some real games). But the X360 and PS3 are not going to last another 3-4 years before a hardware refresh. They are already way behind the times of what people expect in the high def world, and people will lose interest unless they come up with something in the next year or two.



no, thats only people who care about graphics over everything else in a game, they are a vocal bunch, but i don't think a majority of people share their vision of needing 4 300$ graphics cards to play a game, and need to revamp that setup every 6 months to be able to continue gaming.

the wiiu will be interesting to say the least, because i can imagine it being the way we play fpses from now on, i can imagine the while game being played on tablet attached to a gun... heres hoping someone does this right...

right now, unless you have a very physics centric game, the consoles can handle it

omninmo :
hmmmmmm I think rising smartphone CPU/GPU power, and improvements to conectivity will eventually kill dedicated consoles, but still enough time for one more generation..phones already have HDMI outputs and decent power in them, as soon as someone crams wireless HDMI or some other way to render games on a TV with no wires, and powerful quad-core mobile chips a couple generations ahead of us with some decent GPU punch start coming out with this, it's game over for consoles...i think.. let's hope not, as I've allways enjoyed my gaming on dedicated PCs/consoles



me and allot of people will never use a smart phone as anything but a phone, because when the battery dies, you cant make calls.

what i forsee is smartphones getting scaled back, or at least stunted in their growth.

people will start to carry 2 devices, a phone, and a everything else. that way the everything else dies, you still have the phone. with how small they are getting, this isnt hard to forsee, and if it only has to be a phone... you can see them getting allot smaller, or more portable, to the point that 2 devices is nothing.

but it is entirely possible that next console cycle, from microsoft and sony, you will see a 10 inch tablet and a docking station for it to hook up to tvs, considering that by 2013, tablets will equal consoles in power, they may take the generation off of increasing the power, move over to a new form factor, where its a tablet and all, it has that app space, but it also has the AAA disc through a dock, and controllers through it too, this way they could move to a 2 year cycle of developing, and sell the systems cheaper at a 300-400$ price point, and kill off the ipad in the process... think of it, if they had the app support, which they would, and the faimaly has even 1 kid, why wouldnt they chose a padstation or an xpad over the ipad?

i mean they make a cut of every game sold, and app sold, they could sell at a slight loss or break even and still pull profit, even at a 2 year cycle.

memadmax 08/24/2011 1:57 AM
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Geez, we're in the middle of a recession and once high flying "entertainment" (like gaming) industries is in a downturn with the rest of us....

Doesn't mean the death of the gaming industry, just means a setback like the rest of us...........

bak0n 08/24/2011 2:17 AM
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I could care less about consoles. I'll stick to my pc's kkthx.

And yes, I have a PS3, but for the blueray more than for the games.

bv90andy 08/24/2011 2:22 AM
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burnley14 :
Switch to SD cards/flash drives or downloads only.



So why DON'T they start selling the games on some special, proprietary memory stick with a unique connection (physical and interface, protocol)? That, if done right, and maybe encrypt data on the HDD could cut down pirating to 0....

Azimuth01 08/24/2011 2:25 AM
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captaincharisma 08/24/2011 2:25 AM
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from the way things are looking the PC's and consoles are going to shift into one eventually. we already seen from this gen that console are now able to update games also have expansion packs. unfortunately this gen showed how todays gamers are willing to spend there money on anything and no matter how bad the product is they are willing to replace it multiple times. like paying MS to play online which you never had to do with PC's ever. now you are paying for your ISP and xbox live . also it is hard to believe people wasted money buying the same high fail rate console more than 2 times.

people are stupid

and you are nuts if anyone is going to take a smartphone seriously as a game system. all smartphones are good for are time waster games like paper toss

soldier37 08/24/2011 2:28 AM
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I prefer Uber high end PC gaming it owns every outdated console there is. Nintendo really, lol. If your 10 thats great news, for us adults that take gaming online and in general seriously hands down PC is where its at! 2560 x 1600 res, 2 x gtx 590s in sli, 16gb ddr3, i7 2600 @ 4.6 ghz 8 cores. Please next story..

bv90andy 08/24/2011 2:30 AM
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omninmo :
hmmmmmm I think rising smartphone CPU/GPU power, and improvements to conectivity will eventually kill dedicated consoles, but still enough time for one more generation..phones already have HDMI outputs and decent power in them, as soon as someone crams wireless HDMI or some other way to render games on a TV with no wires, and powerful quad-core mobile chips a couple generations ahead of us with some decent GPU punch start coming out with this, it's game over for consoles...i think.. let's hope not, as I've allways enjoyed my gaming on dedicated PCs/consoles


That is REALLY far fetched... unless some battery revolution finally decides to come about, they won't implement anything on that scale. And then there's the part where it's getting harder and harder to build smaller transistors...

Azimuth01 08/24/2011 2:41 AM
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"and you are nuts if anyone is going to take a smartphone seriously as a game system. all smartphones are good for are time waster games like paper toss"

Really? Between Android and iOS market market penetration is more then Xbox and PS3 could ever hope for in their wiliest wet dreams. Processor power and graphics on the highest end tabs and phones are just barely behind the current consoles. It's just a matter of time.

10 years ago no one would admit that an MP3 player could ever replace the 300 disc CD carousel....today you can't find one, but Ipod docks are everywhere.

K-zon 08/24/2011 3:02 AM
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carlhenry 08/24/2011 3:13 AM
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sorry but wow, a lot of pc fanatics here cheering for consoles to die to get a thumbs up.
dude, get a life.

i'm a pc gamer myself but consoles give us the opportunity to play straight on.

MCFCBlue 08/24/2011 3:27 AM
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Consoles just restrict us from seeing what should be seen

Anonymous 08/24/2011 3:28 AM
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I want PC and Console game market to rebound so that my favorite game can be released constantly.

alidan 08/24/2011 4:11 AM
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bv90andy :
That is REALLY far fetched... unless some battery revolution finally decides to come about, they won't implement anything on that scale. And then there's the part where it's getting harder and harder to build smaller transistors...



have it docked, and battery life is no longer an issue.

soldier37 :
I prefer Uber high end PC gaming it owns every outdated console there is. Nintendo really, lol. If your 10 thats great news, for us adults that take gaming online and in general seriously hands down PC is where its at! 2560 x 1600 res, 2 x gtx 590s in sli, 16gb ddr3, i7 2600 @ 4.6 ghz 8 cores. Please next story..


1000
1500
200
300

those are raw numbers of what you just described, without going into other details like the psu and so on. i honestly dont believe games should be built with sli or crossfire in mind, compatible yes, but not thinking that you need it to play the game. and should be built with a 1920x1080 resolution, and the highest end single gpu (not dual in 1 slot) as the high end with no aa filtering at all.

after than, if you want a higher res and blow that much money on more gpu, you get a smoother game play at a higher resolution with more bells and whistles, like higher framerates, more aa, and such. but it should never be "you need this to run the game at max"

the idea of building for the future of gameing needs to die, because you cant always bruteforce a game into better performance, look how long it took crysis to be playable. devs should be forced to make games for single gpus, and if they want to push the envelope, code the game better, want an example, look at consoles. the first generation of 360, or ps3 games, compared to even the worst of what we have now. just imagine, if it wasnt for consoles, how many games would be developed like crysis, where graphics over what a normal pc can do.

here is what i want a gaming pc to be considered as. a quad core cpu, intel/amd, doesn't really matter in gaming, 10% more frame rate isnt enough to say you need an intel system.

the core computer, as in everything but the gpu, should cost about 500$ and the gpu is the gaming premium, and that is about 300-400$

anything more than that should be considered an overkill gaming rig, just so people don't get confused, like so many are now.

alidan 08/24/2011 4:18 AM
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Azimuth01 :
"and you are nuts if anyone is going to take a smartphone seriously as a game system. all smartphones are good for are time waster games like paper toss"Really? Between Android and iOS market market penetration is more then Xbox and PS3 could ever hope for in their wiliest wet dreams. Processor power and graphics on the highest end tabs and phones are just barely behind the current consoles. It's just a matter of time.10 years ago no one would admit that an MP3 player could ever replace the 300 disc CD carousel....today you can't find one, but Ipod docks are everywhere.



people dont care about quality of the sound, which is sad. if you look just at sound quality, the cd should have never died.

carlhenry :
sorry but wow, a lot of pc fanatics here cheering for consoles to die to get a thumbs up.dude, get a life.i'm a pc gamer myself but consoles give us the opportunity to play straight on.



its like they forgot how often pc games required you to upgrade, and even than, not be able to play at the max setting because the developers designed the game for the future and it would be brute force rendered, instead of writing the code better. im hoping crysis is the last game like that.

the pc needs consoles, because they force developers to code games better. and for every game the console screws (oblivion) they make so many more better because of the restrictions.

robertito 08/24/2011 5:02 AM
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alidan :
people dont care about quality of the sound, which is sad. if you look just at sound quality, the cd should have never died.


Not true, even an audiophile can't tell the difference between a VBR0 cd rip and the actual thing. Even V2 or 3 is more than acceptable for the common listener as the resulting compression is minimal and, for the most part, limited to the extreme high and low end.

alidan 08/24/2011 7:19 AM
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robertito :
Not true, even an audiophile can't tell the difference between a VBR0 cd rip and the actual thing. Even V2 or 3 is more than acceptable for the common listener as the resulting compression is minimal and, for the most part, limited to the extreme high and low end.



except when the extreme high and low are in there, even if you cant hear them, you can still preceve them

but the point is that most people are ok with a 128bit mp3, because they never had good headphones to hear what a flac or the cd itself sounds like.

after i learned the basics of sound encoding and such, i stopped reading more, this was a long time ago, so im not sure if i ever heard a VBR0 encoding.

zak_mckraken 08/24/2011 3:40 PM
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alidan :
people dont care about quality of the sound, which is sad. if you look just at sound quality, the cd should have never died.


The vinyl should have bever died.

jahmekan 08/24/2011 6:53 PM
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The problem with consoles is that MS/Sony is trying to get more years out of them instead of going to the five year cycle. People want new shiny toys, even though they might bitch and moan about purchasing it. Get the new consoles out and have compelling software behind it and it will sell.

millerm84 08/24/2011 9:35 PM
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captaincharisma :
fand you are nuts if anyone is going to take a smartphone seriously as a game system. all smartphones are good for are time waster games like paper toss



Console lifetime 38 years
Smartphone lifetime 18 years

Consoles have a full 20 years of development over smartphones, yet the smartphone has all of the functionality of the console. Graphics wise the console is well beyond dominate and will hold an advantage as long as game developers develop for PC/Console hardware. This will not always be the case as NVidia has dedicated resources just to smartphone development. As phone become more and more powerful they will replace handheld game consoles and are a easy sync to your TV away from competing with your game console. Consoles are also at a disadvantage because they currently rely on PC development to get the latest greatest components down to the size and heat requirements the console makers demand. Like PC developers smartphone developers start with a form factor and build from the ground up, not having to adapt relevant technology so much as create relevant technology. The smartphones biggest disadvantage is the battery, crossing the barrier of lets say 10 hours of full use (ie gaming) will push the versatility of the smartphone beyond that of a console.

eddieroolz 08/25/2011 1:12 AM
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Might be exaggerated, but doesn't mean we don't want this to happen...:)