Analysts Forecast Big Growth Year For Console/PC Market
Mar 4, 1998 (MULTIMEDIA WIRE, Vol. 5, No. 42) -- The installed base of
32- and 64-bit game consoles is nearing mass-market numbers after
strong sales in 1996-1997, and it's against that multisystem platform
base that analysts are predicting a big growth year for interactive
game software. "We're forecasting a 55% jump in console revenue (32-
and 64-bit software) to $3.4b," says David Cole, an analyst with DFC
Intelligence. DFC is forecasting console sales of $3.6b in 1999.
The PC market, typically characterized by slower, steady growth, will
climb to $1.7b in 1998 sales, a 21.4% bump, Cole says. The U.S.
interactive entertainment market as a whole reached a record $5.5b in
sales last year (MMW, Jan. 27). PlayStation and N64 are forecast to
sell about 12m units worth some $1.4b in the U.S., based on an
estimated $120 average cost per unit. 1998 is going to be a good
software year because hardware has done so well the last two years,
agrees James Lin, an analyst at Wedbush Morgan Securities. "The Sony
[SNE] PlayStation has tremendous legs. Sony has put about $100m into
marketing the platform, and that investment is paying off."
N64 sales volume has created a much more "visible" market for N64
software, but on the consumer and developer side, Lin says. A visible
hardware base creates more excitement in the market.  "Having two
systems out there doing well, plus the sub-$1,000 PC adds up to
another great year." Even Electronic Arts [ERTS] is jumping on the N64
bandwagon in 1998 because the company sees the growth in the segment,
says Rob Fagin, an analyst with Oppenheimer & Co.
One area worth watching is whether N64 or PlayStation will emerge as
the clear market leader, or if they'll continue splitting the market,
analysts say. Earlier this year, Sony said PlayStation controls 49.2%
of the North American console market (MMWire, Jan 29). Both systems
appeal to different market segments. The PlayStation appeals to the
20-something marketplace and N64 to the pre-teen crowd. "The question
is whether Nintendo can appeal to an older audience and PlayStation
can make inroads into the younger gamer segments," according to Cole.
From:  Silicon Times Report / March 06, 1998 / No.1409
... "Unfortunately, the chronology is already badly out of date." -JME
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