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The video game industry is the economic sector involved in the development, marketing, and monetization of video games. It encompasses dozens of job disciplines and its component parts employ thousands of people worldwide.
One classical breakdown of economic activity distinguishes three sectors:
Video game development is the process of creating a video game. The effort is undertaken by a developer, ranging from a single person to an international team dispersed across the globe. Development of traditional commercial PC and console games is normally funded by a publisher, and can take several years to reach completion. Indie games usually take less time and money and can be produced by individuals and smaller developers. The independent game industry has been on the rise, facilitated by the growth of new online distribution systems such as Steam and Uplay, as well as the mobile game market for Android and iOS devices.
Video game monetization is the process that an video game publisher can use to generate revenue from a video game product. The methods of monetization may vary between games, especially when they come from different genres or platforms, but they all serve the same purpose to return money to the game developers, copyright owners, and other stakeholders. As the monetization methods continue to diversify, they also affect the game design in a way that sometimes leads to criticism.
The computer and video-game industry has grown from focused markets to mainstream.[ citation needed ] They took in about US$9.5 billion in the US in 2007, 11.7 billion in 2008, and 25.1 billion in [update] 2010 (ESA annual report).
The United States dollar is the official currency of the United States and its territories per the United States Constitution since 1792. In practice, the dollar is divided into 100 smaller cent (¢) units, but is occasionally divided into 1000 mills (₥) for accounting. The circulating paper money consists of Federal Reserve Notes that are denominated in United States dollars.
The Entertainment Software Association (ESA) is the trade association of the video game industry in the United States. It was formed in April 1994 as the Interactive Digital Software Association (IDSA) and renamed on July 21, 2003. It is based in Washington, D.C. Most of the top publishers in the gaming world are members of the ESA, including Capcom, Electronic Arts, Konami, Microsoft, Bandai Namco Entertainment, Nintendo, Sony Interactive Entertainment, Square Enix, Take-Two Interactive, Ubisoft, and Warner Bros. Interactive Entertainment.
Modern personal computers owe many advances and innovations to the game industry: sound cards, graphics cards and 3D graphic accelerators, faster CPUs, and dedicated co-processors like PhysX are a few of the more notable improvements.
A personal computer (PC) is a multi-purpose computer whose size, capabilities, and price make it feasible for individual use. Personal computers are intended to be operated directly by an end user, rather than by a computer expert or technician. Unlike large costly minicomputer and mainframes, time-sharing by many people at the same time is not used with personal computers.
A sound card is an internal expansion card that provides input and output of audio signals to and from a computer under control of computer programs. The term sound card is also applied to external audio interfaces used for professional audio applications.
PhysX is an open-source realtime physics engine middleware SDK developed by Nvidia as a part of Nvidia GameWorks software suite.
Sound cards were developed[ by whom? ] for addition of digital-quality sound to games and only later improved for music and audiophiles. Early on, graphics cards were developed for more colors. Later, graphic cards were developed[ by whom? ] for graphical user interfaces (GUIs) and games; GUIs drove the need for high resolution, and games began using 3D acceleration. They also are one of the only pieces of hardware to allow multiple hookups (such as with SLI or CrossFire graphics-cards). CD- and DVD-ROMs developed for mass distribution of media in general; however, the ability to store more information on cheap, easily distributable media became instrumental in driving their ever-higher speeds.
An audiophile is a person who is enthusiastic about high-fidelity sound reproduction. An audiophile seeks to reproduce the sound of a live musical performance, typically in a room with good acoustics. It is widely agreed that reaching this goal is very difficult and that even the best-regarded recording and playback systems rarely, if ever, achieve it.
The graphical user interface is a form of user interface that allows users to interact with electronic devices through graphical icons and visual indicators such as secondary notation, instead of text-based user interfaces, typed command labels or text navigation. GUIs were introduced in reaction to the perceived steep learning curve of command-line interfaces (CLIs), which require commands to be typed on a computer keyboard.
Ben Sawyer of Digitalmill observes that the game industry value chain is made up of six connected and distinctive layers:
A value chain is a set of activities that a firm operating in a specific industry performs in order to deliver a valuable product or service for the market. The concept comes through business management and was first described by Michael Porter in his 1985 best-seller, Competitive Advantage: Creating and Sustaining Superior Performance.
The idea of the value chain is based on the process view of organizations, the idea of seeing a manufacturing organization as a system, made up of subsystems each with inputs, transformation processes and outputs. Inputs, transformation processes, and outputs involve the acquisition and consumption of resources – money, labour, materials, equipment, buildings, land, administration and management. How value chain activities are carried out determines costs and affects profits.
The game industry employs those experienced in other traditional businesses, but some have experience tailored to the game industry. Some of the disciplines specific to the game industry include: game programmer, game designer, level designer, game producer, game artist and game tester. Most of these professionals are employed by video game developers or video game publishers. However, many hobbyists also produce computer games and sell them commercially.[ citation needed ] Game developers and publishers sometimes employ those with extensive or long-term experience within the modding communities.
A video game developer is a software developer that specializes in video game development – the process and related disciplines of creating video games. A game developer can range from one person who undertakes all tasks to a large business with employee responsibilities split between individual disciplines, such as programming, design, art, testing, etc. Most game development companies have video game publisher financial and usually marketing support. Self-funded developers are known as independent or indie developers and usually make indie games.
A video game publisher is a company that publishes video games that have been developed either internally by the publisher or externally by a video game developer. As with book publishers or publishers of DVD movies, video game publishers are responsible for their product's manufacturing and marketing, including market research and all aspects of advertising.
A hobby is a regular activity done for enjoyment, typically during one's leisure time. Hobbies include collecting themed items and objects, engaging in creative and artistic pursuits, playing sports, or pursuing other amusements. Participation in hobbies encourages acquiring substantial skills and knowledge in that area. A list of hobbies changes with renewed interests and developing fashions, making it diverse and lengthy. Hobbies tend to follow trends in society, for example stamp collecting was popular during the nineteenth and twentieth centuries as postal systems were the main means of communication, while video games are more popular nowadays following technological advances. The advancing production and technology of the nineteenth century provided workers with more availability in leisure time to engage in hobbies. Because of this, the efforts of people investing in hobbies has increased with time.
Prior to the 1970s, there was no significant commercial aspect of the video game industry, but many advances in computing would set the stage for the birth of the industry.
Many early publicly available interactive computer-based game machines used or other mechanisms to mimic a display; while technically not "video games", they had elements of interactivity between the player and the machine. Some examples of these included the 1940 "Nimatron", an electromagentic relay-based Nim-playing device designed by Edward Condon and built by Westinghouse Electric for the New York World's Fair,Bertie the Brain , an arcade game of tic-tac-toe, built by Josef Kates for the 1950 Canadian National Exhibition, and Nimrod created by engineering firm Ferranti for the 1951 Festival of Britain,
The development of cathode ray tube —the core technology behind televisions—created several of the first true video games. In 1947 Thomas T. Goldsmith Jr. and Estle Ray Mann filed a patent for a "cathode ray tube amusement device". Their game, which uses a cathode ray tube hooked to an oscilloscope display, challenges players to fire a gun at target.
Between the 1950s and 1960s, with mainframe computers becoming available to campus colleges, students and others started to develop games that could be played at terminals that accessed the mainframe. One of the first known examples is Spacewar! , developed by Harvard and MIT employees Martin Graetz, Steve Russell, and Wayne Wiitanen.The introduction of easy-to-program languages like BASIC for mainframes allowed for more simplistic games to be developed.
In 1971, the arcade game, Computer Space was released. billion in quarters, equivalent to $4.6 billion in 2011.The following year, Atari, Inc. released the first commercially successful video game, Pong , the original arcade version of which sold over 19,000 arcade cabinets. That same year saw the introduction of video games to the home market with the release of the early video game console, the Magnavox Odyssey. However, both the arcade and home markets would be dominated by Pong clones, which flooded the market and led to the video game crash of 1977. The crash eventually came to an end with the success of Taito's Space Invaders , released in 1978, sparking a renaissance for the video game industry and paving the way for the golden age of video arcade games. The game's success inspired arcade machines to become prevalent in mainstream locations such as shopping malls, traditional storefronts, restaurants and convenience stores during the golden age. Space Invaders would go on to sell over 360,000 arcade cabinets worldwide, and by 1982, generate a revenue of $2
Soon after, Space Invaders was licensed for the Atari VCS (later known as Atari 2600), becoming the first "killer app" and quadrupling the console's sales.The success of the Atari 2600 in turn revived the home video game market during the second generation of consoles, up until the North American video game crash of 1983. By the end of the 1970s, the personal computer game industry began forming from a hobby culture.
The early 1980s saw the golden age of video arcade games reach its zenith. The total sales of arcade video game machines in North America increased significantly during this period, from $50 million in 1978 to $900 million by 1981,with the arcade video game industry's revenue in North America tripling to $2.8 billion in 1980. By 1981, the arcade video game industry was generating an annual revenue of $5 billion in North America, equivalent to $12.3 billion in 2011. In 1982, the arcade video game industry reached its peak, generating $8 billion in quarters, equivalent to over $18.5 billion in 2011, surpassing the annual gross revenue of both pop music ($4 billion) and Hollywood films ($3 billion) combined at that time. This was also nearly twice as much revenue as the $3.8 billion generated by the home video game industry that same year; both the arcade and home markets combined add up to a total revenue of $11.8 billion for the video game industry in 1982, equivalent to over $27.3 billion in 2011. The arcade video game industry would continue to generate an annual revenue of $5 billion in quarters through to 1985. The most successful game of this era was Namco's Pac-Man , released in 1980, which would go on to sell over 350,000 cabinets, and within a year, generate a revenue of more than $1 billion in quarters; in total, Pac-Man is estimated to have grossed over 10 billion quarters ($2.5 billion) during the 20th century, equivalent to over $3.4 billion in 2011.
The early part of the decade saw the rise of 8-bit home computing, and home-made games, especially in Europe (with the ZX Spectrum and Commodore 64) and Asia (with the NEC PC-88 and MSX). This time also saw the rise of video game journalism, which was later expanded to include covermounted cassettes and CDs. In 1983, the North American industry crashed due to the production of too many badly developed games (quantity over quality), resulting in the fall of the North American industry. The industry would eventually be revitalized by the release of the Nintendo Entertainment System, which resulted in the home console market being dominated by Japanese companies such as Nintendo,while a professional European computer game industry also began taking shape with companies such as Ocean Software and Gremlin Interactive. The latter part of the decade saw the rise of the Game Boy handheld system. In 1987, Nintendo lost a legal challenge against Blockbuster Entertainment, which enabled games rentals in the same way as movies.
The 1990s saw advancements in game related technology. Among the significant advancements were:
Aside from technology, in the early part of the decade, licensed games became more popular,as did video game sequels.
The video game industry generated worldwide sales of $19.8 billion in 1993(equivalent to $31 billion in 2011), $20.8 billion in 1994 (equivalent to $32 billion in 2011), and an estimated $30 billion in 1998 (equivalent to $41.5 billion in 2011). In the United States alone, in 1994, arcades were generating $7 billion in quarters (equivalent to $11 billion in 2011) while home console game sales were generating revenues of $6 billion (equivalent to $9 billion in 2011). Combined, this was nearly two and a half times the $5 billion revenue generated by movies in the United States at the time.
In 2000s, the video game industry is a juggernaut of development; profit still drives technological advancement which is then used by other industry sectors. Technologies such as Smartphones, virtual reality and augmented reality are major drivers for game hardware and gameplay development. Though maturing, the video game industry was still very volatile, with third-party video game developers quickly cropping up, and just as quickly, going out of business.[ citation needed ] Nevertheless, many casual games and indie games were developed and become popular and successful, such as Braid and Limbo . Game development for mobile phones (such as iOS and Android devices) and social networking sites emerged. For example, a Facebook game developer, Zynga, has raised in excess of $300 million.[ clarification needed ]
Though not the main driving force, indie games continue to have a significant impact on the industry, with sales of some of these titles such as Spelunky , Fez , Don't Starve , Castle Crashers , and Minecraft , exceeding millions of dollars and over a million users. [ unreliable source? ] The 2010s have seen a larger shift to casual and mobile gaming; in 2016, the mobile gaming market is estimated to have taken $38 billion in revenues, compared to $6 billion for the console market and $33 billion for personal computing gaming. Games centered on virtual reality and augmented reality equipment also arose during this decade. As of 2014, newer game companies arose that vertically integrate live operations and publishing such as crowdfunding and other direct-to-consumer efforts, rather than relying on a traditional publishers, and some of these have grown to substantial size. Spurred by some initial events in the late 2000s, eSports centered around professional players in organized competitions and leagues for prize money, grew greatly over this decade, drawing hundreds of millions of viewers and reaching nearly $500 million in revenue by 2016 and expected to break $1 billion by 2019.
Early on, development costs were minimal, and video games could be quite profitable. Games developed by a single programmer, or by a small team of programmers and artists, could sell hundreds of thousands of copies each. Many of these games only took a few months to create, so developers could release multiple titles per year. Thus, publishers could often be generous with benefits, such as royalties on the games sold. Many early game publishers started from this economic climate, such as Origin Systems, Sierra Entertainment, Capcom, Activision and Electronic Arts.
As computing and graphics power increased, so too did the size of development teams, as larger staffs were needed to address the ever-increasing technical and design complexities. The larger teams consist of programmers, artists, game designers, and producers. Their salaries can range anywhere from $50,000 to $120,000 generating large labor costs for firms producing videogameswhich can often take between one and three years to develop. Now budgets typically reach millions of dollars despite the growing popularity of middleware and pre-built game engines. In addition to growing development costs, marketing budgets have grown dramatically, sometimes consisting of two to three times of the cost of development.
The game development team has to select a profitable and suitable method to sell or earn money from the finished game. Traditionally, the game monetization method is to sell hard copies in retail store. Now some developers are turning to alternative production and distribution methods, such as online distribution, to reduce costs and increase revenue.
Today, the video game industry has a major impact on the economy through the sales of major systems and games such as Call of Duty: Black Ops , which took in over $650 USD million of sales in the game's first five days and which set a five-day global record for a movie, book or videogame.The game's income was more than the opening weekend of Spider-Man 3 and the previous title holder for a video game Halo 3 . Many individuals have also benefited from the economic success of video games including the former chairman of Nintendo and Japan's third richest man: Hiroshi Yamauchi. Today the global video game market is valued at over $93 billion.
The industry wide adoption of high-definition graphics during the seventh generation of consoles greatly increased development teams' sizes and reduced the number of high-budget, high-quality titles under development. In 2013 Richard Hilleman of Electronic Arts estimated that only 25 developers were working on such titles for the eighth console generation, compared to 125 at the same point in the seventh generation-console cycle seven or eight years earlier.
By 2018, the United States video game industry had matched that of the Unites States film industry on basis of revenue, with both industries having made around US$43 billion that year.
The games industry's shift from brick and mortar retail to digital downloads led to a severe sales decline at video game retailers such as GameStop, following other media retailers superseded by Internet delivery, such as Blockbuster, Tower Records, and Virgin Megastores. GameStop diversified its services by purchasing chains that repair wireless devices and expanding its trade-in program through which customers trade used games for credit towards new games.The company began to produce its own merchandise and games. In Britain, the games retailer Game revamped its stores so customers would spend time playing games there. It built a gaming arena for events and tournaments. The shift to digital marketplaces, especially for smartphones, led to an influx of inexpensive and disposable titles, as well as lower engagement among gamers who otherwise purchased new games from retail. Customers also shifted away from the tradition of buying games on their first day of release.
Publishers often funded trade-in deals to encourage consumers to purchase new games. Trade-in customers at the Australia retailer Game would purchase twice the games per year as non-trade-in customers. The sale of pre-owned games kept retailers in business, and composed about a third of Game's revenue. Retailers also saved on the UK's value-added tax, which only taxed the retailer's profit on pre-owned games, rather than the full sale on regular games. The former trade-in retail executives behind the trade-in price comparison site Trade In Detectives estimated that the United Kingdom's trade-in industry was about a third of the size of its new games business.They figured that sites such as eBay, which convert used games into cash, compose about a quarter of the UK's trade-in market, but do not keep the credit within the industry. While consumers might appear to receive better offers on these sites, they also take about 15 percent of the selling price in fees. Alternatively, some retailers will match the trade-in values offered by their competitors. Microsoft's original plan for the Xbox One attempted to translate trade-in deals for the digital marketplace, with a database of product licenses that shops would be able to resell with publisher permission, though the plan was poorly received or poorly sold.
Video game industry practices are similar to those of other entertainment industries (e.g., the music recording industry), but the video game industry in particular has been accused of treating its development talent poorly. This promotes independent development, as developers leave to form new companies and projects. In some notable cases, these new companies grow large and impersonal, having adopted the business practices of their forebears, and ultimately perpetuate the cycle.
However, unlike the music industry, where modern technology has allowed a fully professional product to be created extremely inexpensively by an independent musician, modern games require increasing amounts of manpower and equipment. This dynamic makes publishers, who fund the developers, much more important than in the music industry.
In the video game industry, it is common for developers to leave their current studio and start their own. A particularly famous case is the "original" independent developer Activision, founded by former Atari developers. Activision grew to become the world's second largest game publisher.In the meantime, many of the original developers left to work on other projects. For example, founder Alan Miller left Activision to start another video game development company, Accolade (now Atari née Infogrames).
Activision was popular among developers for giving them credit in the packaging and title screens for their games, while Atari disallowed this practice. As the video game industry took off in the mid-1980s, many developers faced the more distressing problem of working with fly-by-night or unscrupulous publishers that would either fold unexpectedly or run off with the game profits.
The industry claims software piracy to be a big problem, and take measures to counter this.Digital rights management have proved to be the most unpopular with gamers, as a measure to counter piracy. The most popular and effective strategy to counter piracy is to change the business model to Freemium, where gamers pay for their in-game needs or service. Strong server-side security is required for this, to properly distinguish authentic transactions from hacked (faked) transactions.
On various Internet forums, some gamers have expressed disapproval of publishers having creative control since publishers are more apt to follow short-term market trends rather than invest in risky but potentially lucrative ideas. On the other hand, publishers may know better than developers what consumers want. The relationship between video game developers and publishers parallels the relationship between recording artists and record labels in many ways. But unlike the music industry, which has seen flat or declining sales in the early 2000s,the video game industry continues to grow. Also, personal computers have made the independent development of music almost effortless, while the gap between an independent game developer and the product of a fully financed one grows larger.
In the computer games industry, it is easier to create a startup, resulting in many successful companies. The console games industry is a more closed one, and a game developer must have up to three licenses from the console manufacturer:
In addition, the developer must usually buy development systems from the console manufacturer in order to even develop a game for consideration, as well as obtain concept approval for the game from the console manufacturer. Therefore, the developer normally has to have a publishing deal in place before starting development on a game project, but in order to secure a publishing deal, the developer must have a track record of console development, something which few startups will have.
An alternative method for publishing video games is to self-publish using the shareware or open source model over the Internet.
Gaming conventions are an important showcase of the industry. The major annual gaming conventions include gamescom in Cologne (Germany), the E3 in Los Angeles (USA),the Penny Arcade Expo, and others.
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As with other forms of media, video games have often been released in different world regions at different times.The practice has been used where localization is not done in parallel with the rest of development or where the game must be encoded differently, as in PAL vs. NTSC. It has also been used to provide price discrimination in different markets or to focus limited marketing resources. Developers may also stagger digital releases so as not to overwhelm the servers hosting the game.
International video game revenue is estimated to be $81.5B in 2014. US$91.5 billion.This is more than double the revenue of the international film industry in 2013. In 2015, it was estimated at
The largest nations by estimated video game revenues in 2016 are China ($24.4B), the United States ($23.5B) and Japan ($12.4B).The largest regions in 2015 were Asia-Pacific ($43.1B), North America ($23.8B), and Western Europe ($15.6B).
Gaming conventions are an important showcase of the industry. The annual gamescom in Cologne (Germany) is a major expo for video games. The E3 in Los Angeles (USA) is also of global importance, but is an event for industry insiders only.
Other notable conventions and trade fairs include Tokyo Game Show (Japan), Brasil Game Show (Brazil), EB Games Expo (Australia), KRI (Russia), ChinaJoy (China) and the annual Game Developers Conference. Some publishers, developers and technology producers also have their own regular conventions, with BlizzCon, QuakeCon, Nvision and the X shows being prominent examples.
Video gaming is still in its infancy throughout the African continent, but due to the continent's young population and increasing technological literacy, the sector is growing rapidly. African countries such as South Africa, Nigeria and Kenya have been making rapid advances in mobile game development, both within their country and internationally,but due to limited funding and a market over-crowded with western games, success has thus far been minimal.
Canada has the third largest video game industry in terms of employment numbers.The video game industry has also been booming in Montreal since 1997, coinciding with the opening of Ubisoft Montreal. Recently, the city has attracted world leading game developers and publishers studios such as Ubisoft, EA, Eidos Interactive, Artificial Mind and Movement, BioWare, Warner Bros. Interactive Entertainment and Strategy First, mainly because video games jobs have been heavily subsidized by the provincial government. Every year, this industry generates billions of dollars and thousands of jobs in the Montreal area. Vancouver has also developed a particularly large cluster of video game developers, the largest of which, Electronic Arts, employs over two thousand people. The Assassin's Creed series, along with the Tom Clancy series have all been produced in Canada and have achieved worldwide success. For consumers, the largest video games convention in Canada is the Enthusiast Gaming Live Expo (EGLX).
China is the largest country by game revenue,and has a gaming public that exceeds the population of the entire United States. It is home to Asia Game Show, the largest game convention in the world by attendance. In 2014, the Xbox One became the first new game console sold since China's ban on consoles in 2000.
Germany has the largest video games market in Europe, with revenues of $4.1 billion forecast for 2017. The annual gamescom in Cologne is Europe's largest gaming expo.
One of the earliest internationally successful video game companies was Gütersloh-based Rainbow Arts (founded in 1984) who were responsible for publishing the popular Turrican series of games. The Anno series and The Settlers series are globally popular strategy game franchises since the 1990s. The Gothic series, SpellForce and Risen are established RPG franchises. The X series by Egosoft is the best-selling space simulation. The FIFA Manager series was also developed in Germany. The German action game Spec Ops: The Line (2012) was successful in the markets and received largely positive reviews. One of the most famed titles to come out of Germany is Far Cry (2004) by Frankfurt-based Crytek, who also produced the topseller Crysis and its sequels later.
Other well-known current and former developers from Germany include Ascaron, Blue Byte, Deck13, Phenomic, Piranha Bytes, Radon, Related, Spellbound and Yager Development. Publishers include Deep Silver (Koch Media), dtp entertainment, Kalypso and Nintendo Europe. Bigpoint Games, Gameforge, Goodgame Studios and Wooga are among the world's leading browser game and social network game developers/distributors.
The Japanese video game industry is markedly different from the industry in North America, Europe and Australia.
Japanese companies have created some of the largest and most lucrative titles ever made, such as the Mario , Donkey Kong , The Legend of Zelda , Metroid and Pokémon series of games.
In recent years, consoles and arcade games have both been overtaken by downloadable free-to-play games on the PC and mobile platforms.
The UK industry is the third largest in the World in terms of developer success and sales of hardware and software by country alone but fourth behind Canada in terms of people employed.The size of the UK game industry is comparable to its film or music industries. In recent years some of the studios have become defunct or been purchased by larger companies such as LittleBigPlanet developer, Media Molecule and Codemasters. The country is home to some of the world's most successful video game franchises, such as Tomb Raider , Grand Theft Auto , Fable , Colin McRae Dirt and Total War .
The country also went without tax relief until March 21, 2012when the British government changed its mind on tax relief for UK developers, which without, meant most of the talented development within the UK may move overseas for more profit, along with parents of certain video game developers which would pay for having games developed in the UK. The industry trade body TIGA estimates that it will increase the games development sector's contribution to UK GDP by £283 million, generate £172 million in new and protected tax receipts to HM Treasury, and could cost just £96 million over five years. Before the tax relief was introduced there was a fear that the UK games industry could fall behind other leading game industries around the world such as France and Canada, of which Canada overtook the UK in terms of job numbers in the industry in 2010.
The United States has the largest video games presence in the world in terms of total industry employees.In 2004, the U.S. game industry as a whole was worth US$10.3 billion. U.S. gaming revenue is forecast to reach $23.5 billion in 2017, making it the second largest market behind China.
Magnavox is credited for releasing the first video game console, the Odyssey. Activision was the first developer to create independent/third-party video games. Once the fastest-growing American company, Atari crashed in spectacular fashion, resulting in the North American video game crash of 1983. This resulted in the domination of the Japanese video game industry worldwide throughout the 1980s and 1990s.
The U.S. is home to major game development companies such as Activision Blizzard ( Call of Duty , World of Warcraft ), Electronic Arts ( FIFA , Battlefield , Mass Effect ), and Take-Two Interactive (Civilization, NBA 2K series, Grand Theft Auto ). ZeniMax Media ( Doom , Fallout , The Elder Scrolls ) is the world's largest privately held video game company.Niantic ( Ingress , Pokémon Go ) is a notable mobile game developer.
Valve Corporation operates Steam, the largest computer gaming platform, with an active user base (≈125 million) that rivals the combined user bases of the current console generation (≈150 million).While not specifically focused on games, the largest mobile gaming platforms are operated by Google (Google Play), and Apple Inc. (App Store), with the majority of mobile revenue coming from Asia. Microsoft operates Xbox, the only major game console hardware franchise not controlled by a Japanese company. Sony established Sony Interactive Entertainment in Silicon Valley to run PlayStation, the world's largest and longest-running video game console franchise.
Intel and Nvidia are the largest makers of PC graphics chips. Advanced Micro Devices has become the most important console processor vendor, with all three of the eighth generation home consoles using AMD GPUs, and two of them use AMD CPUs. Microsoft, Nintendo, and Sony were not aware that they were all using AMD processors until all their consoles were announced,underscoring the secrecy found within the game industry. Notable game engine developers include Epic Games (Unreal Engine) and Unity Technologies (Unity).
The West Coast is home to important video game conventions, such as Electronic Entertainment Expo (E3), one of the largest video game industry-only events in the world, and Penny Arcade Expo (PAX West), the largest public video game convention in North America. The West Coast is also home to many of the major American video game industry companies, particularly the regions of Los Angeles, San Francisco Bay Area, and Seattle. Major game development regions outside of the West Coast include the Northeast and Texas.
Over 150 million Americans play video games, with an average age of 35 and a gender breakdown of 59 percent male and 41 percent female.American gamers are more likely to vote than non-gamers, feel that the economy is the most important political issue, and lean conservative, however party demographics are split evenly with 38% identifying as Democrats, 38% identifying as Republicans, and 24% identifying as Independents.
Several important game development personalities were born in or moved to the United States. Notable developers include Ralph H. Baer (Magnavox Odyssey, the "Father of Video Games"), Jonathan Blow ( Braid ), John D. Carmack ( Doom , Quake ), and Alexey Pajitnov ( Tetris ). Mario is named after Mario Segale, a former landlord of Nintendo of America. Some right-wing and left-wing activists, including Jack Thompson and Anita Sarkeesian, have met extreme resistance from the gaming public in response to the perceived politicizing of their art form.
The United States recognizes eSports players as professional athletes.Major League Gaming has eSports arenas and studios across the nation. Robert Morris University has a League of Legends varsity team, whose members are eligible for scholarships.
Players become fourth-party developers, allowing for more open source models of game design, development and engineering. Players also create modifications (mods), which in some cases become just as popular as the original game for which they were created. An example of this is the game Counter-Strike , which began as a mod of the video game Half-Life and eventually became a very successful, published game in its own right.
While this "community of modifiers" may only add up to approximately 1% of a particular game's user base, the number of those involved will grow as more games offer modifying opportunities (such as, by releasing source code) and the video user base swells. According to Ben Sawyer, as many as 600,000 established online game community developers existed as of 2012. This effectively added a new component to the game industry value chain and if it continues to mature, it will integrate itself into the overall industry.
The industry has seen a shift towards games with multiplayer facilities. A larger percentage of games on all types of platforms include some type of competitive online multiplayer capability.
In addition, the industry is experiencing further significant change driven by convergence, with technology and player comfort being the two primary reasons for this wave of industry convergence. Video games and related content can now be accessed and played on a variety of media, including: cable television, dedicated consoles, handheld devices and smartphones, through social networking sites or through an ISP, through a game developer's website, and online through a game console and/or home or office personal computer. In fact, 12% of U.S. households already make regular use of game consoles for accessing video content provided by online services such as Hulu and Netflix. In 2012, for the first time, entertainment usage passed multiplayer game usage on Xbox, meaning that users spent more time with online video and music services and applications than playing multiplayer games. This rapid type of industry convergence has caused the distinction between video game console and personal computers to disappear. A game console with high-speed microprocessors attached to a television set is, for all intents and purposes, a computer and monitor.
As this distinction has been diminished, players' willingness to play and access content on different platforms has increased. The growing video gamer demographic accounts for this trend, as former president of the Entertainment Software Association Douglas Lowenstein explained at the 10th E3 expo, "Looking ahead, a child born in 1995, E3's inaugural year, will be 19 years old in 2014. And according to Census Bureau data, by the year 2020, there will be 174 million Americans between the ages of 5 and 44. That's 174 million Americans who will have grown up with PlayStations, Xboxes, and GameCubes from their early childhood and teenage years...What this means is that the average gamer will be both older and, given their lifetime familiarity with playing interactive games, more sophisticated and discriminating about the games they play."
Evidence of the increasing player willingness to play video games across a variety of media and different platforms can be seen in the rise of casual gaming on smartphones, tablets, and social networking sites as 92% of all smartphone and tablet owners play games at least once a week, 45% play daily, and industry estimates predict that, by 2016, one-third of all global mobile gaming revenue will come from tablets alone. Apple's App Store alone has more than 90,000 game apps, a growth of 1,400% since it went online. In addition, game revenues for iOS and Android mobile devices now exceed those of both Nintendo and Sony handheld gaming systems combined.
The Atari 2600, originally branded as the Atari Video Computer System or Atari VCS for short until November 1982, is a home video game console from Atari, Inc. Released on September 11, 1977, it is credited with popularizing the use of microprocessor-based hardware and games stored on ROM cartridges instead of dedicated hardware with games physically built into the unit. The 2600 was bundled with two joystick controllers, a conjoined pair of paddle controllers, and a game cartridge: initially Combat, and later Pac-Man.
The history of video games goes as far back as the early 1950s, when academic computer scientists began designing simple games and simulations as part of their research or just for fun. At M.I.T. in the 1960s, professors and students played games such as 3D tic-tac-toe and Moon Landing. These games were played on computer such as the IBM 1560, and moves were made by means of punch cards. Video gaming did not reach mainstream popularity until the 1970s and 1980s, when video arcade games and gaming consoles using joysticks, buttons, and other controllers, along with graphics on computer screens and home computer games were introduced to the general public. Since the 1980s, video gaming has become a popular form of entertainment and a part of modern popular culture in most parts of the world. One of the early games was Spacewar!, which was developed by computer scientists. Early arcade video games developed from 1972 to 1978. During the 1970s, the first generation of home consoles emerged, including the popular game Pong and various "clones". The 1970s was also the era of mainframe computer games. The golden age of arcade video games was from 1978 to 1982. Video arcades with large, graphics-decorated coin-operated machines were common at malls and popular, affordable home consoles such as the Atari 2600 and Intellivision enabled people to play games on their home TVs. During the 1980s, gaming computers, early online gaming and handheld LCD games emerged; this era was affected by the video game crash of 1983. From 1976 to 1992, the second generation of video consoles emerged.
Activision Publishing, Inc. is an American video game publisher based in Santa Monica, California. It currently serves as the publishing business for its parent company, Activision Blizzard, and consists of several subsidiary studios. Activision is one of the largest third-party video game publishers in the world and was the top United States publisher in 2016.
An arcade game or coin-op game is a coin-operated entertainment machine typically installed in public businesses such as restaurants, bars and amusement arcades. Most arcade games are video games, pinball machines, electro-mechanical games, redemption games or merchandisers. While exact dates are debated, the golden age of arcade video games is usually defined as a period beginning sometime in the late 1970s and ending sometime in the mid-1980s. Excluding a brief resurgence in the early 1990s, the arcade industry subsequently declined in the Western hemisphere as competing home video game consoles such as the Sony PlayStation and Microsoft Xbox increased in their graphics and game-play capability and decreased in cost. The eastern hemisphere retains a strong arcade industry.
The video game crash of 1983 was a large-scale recession in the video game industry that occurred from 1983 to 1985, primarily in America. The crash was attributed to several factors, including market saturation in the number of game consoles and available games, and waning interest in console games in favor of personal computers. Revenues peaked at around $3.2 billion in 1983, then fell to around $100 million by 1985. The crash was a serious event which abruptly ended what is retrospectively considered the second generation of console video gaming in North America.
A console game is a form of interactive multimedia entertainment, consisting of manipulable images generated by a video game console and displayed on a television or similar audio-video system. The game itself is usually controlled and manipulated using a handheld device connected to the console, called a controller. The controller generally contains a number of buttons and directional controls such as analogue joysticks, each of which has been assigned a purpose for interacting with and controlling the images on the screen. The display, speakers, console, and controls of a console can also be incorporated into one small object known as a handheld game.
The golden age of arcade video games was the era when arcade video games entered pop culture and became a dominant cultural force. The exact time period is disputed, but key moments include the release of Space Invaders in 1978 and the vector-based Asteroids in 1979—moments made possible by the increase in power and decrease in cost of computing technology. This led to the rise of both video game arcades and video games in other media, such as songs, cartoons, and movies like 1982's TRON. Other iconic games from this era include Pac-Man, Defender, Galaga, Donkey Kong, and Centipede.
A mobile game is a game played on a feature phone, smartphone/tablet, smartwatch, PDA, portable media player or graphing calculator. The earliest known game on a mobile phone was a Tetris variant on the Hagenuk MT-2000 device from 1994.
1982 was the peak year of arcade and console games during the Golden age of arcade video games. Troubles at Atari, Inc. late in the year triggered the North American video game crash of 1983. Many games were released that would spawn franchises, or at least sequels, including Dig Dug, Pole Position, Mr. Do!, Pitfall!, Q*bert, and Xevious. Additional consoles add to a crowded market. The new Commodore 64 goes on to eventually dominate the 8-bit home computer market.
Fueled by the previous year's release of the colorful and appealing Pac-Man, the audience for arcade games in 1981 became much wider. Pac-Man influenced maze games began appearing in arcades and on home systems. Nintendo broke from their mediocre early releases with Donkey Kong which defined the platform genre.
1980 saw the release of a number games with influential concepts, including Pac-Man, Battlezone, Crazy Climber, Mystery House, Missile Command, Space Panic, Zork I, and Olympic Decathlon. The Atari VCS grew in popularity with a port of Space Invaders and support from new developer Activision.
A PC game, also known as a computer game or personal computer game, is a type of video game played on a personal computer rather than a video game console or arcade machine. Its defining characteristics include: more diverse and user-determined gaming hardware and software; and generally greater capacity in input, processing, video and audio output. The uncoordinated nature of the PC game market, and now its lack of physical media, make precisely assessing its size difficult.
Video gaming in China is a massive industry and pastime that includes the production, sale, import/export, and playing of video games. China is the largest, highest grossing and the most profitable video game market in the world, since 2015. The landscape of the topic is strongly shaped by China's average income level, rampant software piracy, and governmental measures to control game content and playing times. In 2011, China's PC game sector was worth $6 billion, the largest in the world. Arcade games are also a thriving industry in China. Console games were banned from the country in 2000, but the ban was lifted in July 2015.
The second decade in the industry's history was decade of highs and lows for video games. The decade began amidst a boom in the arcade business with giants like Atari still dominating the market since the late-1970s. Another, the rising influence of the home computer, and a lack of quality in the games themselves lead to an implosion of the North American video game market that nearly destroyed the industry. It took home consoles years to recover from the crash, but Nintendo filled in the void with its Nintendo Entertainment System (NES), reviving interest in consoles. Up until this point, most investors believed video games to be a fad that has since passed. In the remaining years of the decade, Sega ignites a console war with Nintendo, developers that have been affected by the crash experiment with the superior graphics of the PC, and Nintendo also releases the Game Boy, which would become the best-selling handheld gaming device for the next two-decades.
Video gaming in the United States is one of the fastest-growing entertainment industries in the country. According to a 2010 study released by the Entertainment Software Association, the computer and the video game industry added $4.9 billion to the economy of the United States. There are some estimates that by 2015 the worldwide gaming industry will possibly reach $70.1 billion.
Video gaming in Finland consists of video gaming industry of 260 active video game developer studios, roughly a dozen professional players and countless enthusiastic amateurs.
In video gaming, games as a service (GaaS) represents providing video games or game content on a continuing revenue model, similar to software as a service. Games as a service are ways to monetize video games either after their initial sale, or to support a free-to-play model. Games released under the GaaS model typically receive a long or indefinite stream of monetized new content over time to encourage players to continue paying to support the game. This often leads to games that work under a GaaS model to be called "living games" or "live games", since they continually change with these updates.
Video gaming in Indonesia is a growing sector, holding the 16th largest market in the world and about half the Southeast Asian market in 2017. Over 40 million people in the country are active gamers, with mobile gaming being the dominant sector in terms of revenue. The development of video games in the country began with imported consoles and arcade centers, prior to developments of online gameplay in PC games and increasing prevalence of the internet cafés. Mobile games began gaining importance as smartphones were introduced.
Atari eventually sold more than 19,000 Pong machines, giving rise to many imitations. Pong made its first appearance in 1972 at "Andy Capp's," a small bar in Sunnyvale, California, where the video game was literally "overplayed" as eager customers tried to cram quarters into an already heavily overloaded coin slot.
At that time, a game for use in entertainment arcades was considered a hit if it sold 1000 units; sales of Space Invaders topped 300,000 units in Japan and 60,000 units overseas.
According to TEC, Atari's arcade game Space Invaders has taken in $2 billion, with net recipts of $450 million.
In 1980 alone, according to Time, $2.8 billion in quarters, triple the amount of the previous years, were fed into video games.
Video game machines have an average weekly take of $109 per machine. The video arcade industry took in $8 billion in quarters in 1982, surpassing pop music (at $4 billion in sales per year) and Hollywood films ($3 billion, $10 billion if cassette sales and rentals are included). Those 32 billion arcade games played translate to 143 games for every man, woman, and child in America. A recent Atari survey showed that 86 percent of the US population from 13 to 20 has played some kind of video game and an estimated 8 million US homes have video games hooked up to the television set. Sales of home video games were $3.8 billion in 1982, approximately half that of video game arcades.
There are 95,000 others like him spread across the country, getting fed a fat share of the $5 billion in videogame quarters every year.
Released in 1980, Pac-Man was an immediate success. It sold over 350,000 units, and probably would of sold more if not for the numerous illegal pirate and bootleg machines that were also sold.
It would go on to become arguably the most famous video game of all time, with the arcade game alone taking in more than a billion dollars, and one study estimated that it had been played more than 10 billion times during the twentieth century.
In the late 1990s, Twin Galaxies, which tracks video game world record scores, visited used game auctions and counted how many times the average Pac Man machine had been played. Based on those findings and the total number of machines that were manufactured, the organization said it believed the game had been played more than 10 billion times in the 20th century.
Hollywood's aim, of course, is to tap into the $7 billion that Americans pour into arcade games each year — and the $6 billion they spend on home versions for Nintendo and Sega game machines. Combined, it's a market nearly 2 ½ times the size of the $5 billion movie box office.
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