Hear that knocking sound? It’s PC gaming!

Do you know what the opportunities are in PC gaming? They’re probably better then you think – the PC gaming market is much bigger than consoles, both in installed base and in money made.

Sound hard to believe? Between how fast changes are happening in game models and distribution mechanisms and industry reports that only give a piece of the whole picture, it’s hard to get a really good feel for what’s happening in PC gaming. And yet, knowing things like how many gaming PCs are out there, how much revenue PC games generate, what the most popular gaming styles are and so forth is critical to deciding what kind of game to build, how to generate revenue from it, and how to distribute it.

We here in the Visual Adrenaline team have struggled with this too. We ask all the same questions as we try to find the best ways to work with games developers and to help them leverage the IA platform. We’ve accumulated a lot of data internally and done a lot of analysis on it. We think it’s helped us to form some answers to these questions, and we want to share the data we’ve put together with you and hear your thoughts on it. Our hope is that together we can create greater accuracy and more transparency around the trends that are happening in PC gaming.

Let’s start with the question of whether there are more consoles or gaming PCs. We consulted reports from the usual suspects - IDC*, DFC*, Mercury*, NPD*, IN-STAT*, Screen Digest*, the PCGA* and a bit of our own internal data to come up with the estimate in the graph for how many units of each platform there are out there today and over the next 5 years.

For the console numbers, we used the number of active consoles globally (in other words, consoles sold minus an estimate of how many have gotten broken or lost or stuck in the back of the closet.) For PCs, we took 2 years cumulative sales of DX10+ discrete graphics cards to estimate the number of enthusiast PCs that are capable of playing most games. That means the estimate might be a little high, since some of those cards might have gone into the same systems or non-gaming systems. At the same time, the estimate might be a little low since we only used 2 cumulative years worth of sales, which is a little short for a PC lifespan. We think those 2 factors probably balance each other out and that this estimate is pretty close.

What’s interesting to see is just how much larger the PC base is than any of the consoles. To tell you the truth, I really hadn’t realized how large a difference it is until I put this chart together. Enthusiast PCs are 62% of the total market, and there are 4PCs out there for every Wii, 7 PCs for every Xbox360 and 8 PCs for every PS3. Wow.

 The second interesting thing is that almost all of the forecasted growth is in notebooks. For a lot of people now, a notebook is the only way to go. I think there will always be a place for desktops, especially with really serious gamers, but a larger and larger percentage of gaming is happening on notebooks.

Now on to the question of how much revenue from gaming each platform generates. We used a similar process to develop our estimate here as we did for the chart above.

The top 3 sections of the chart show, in US dollars, the total amount of revenue generated globally from all types of games on the Wii, the Xbox360 and the PS3. The bottom 3 rows are all gaming revenue from PCs, broken into 3 categories. The bottom category we called PC Traditional Game SW. This basically covers games that you pay for upfront. Whether purchased in retail or downloaded online, if you paid for the game before playing it, we put it in this category. The PC MMOG category covers subscription based gaming. And the PC Free to Play category includes games that are based on transactions (like buying equipment or upgrades in the game) and on advertising.

Today, PC gaming generates 43% of the total gaming revenue. The next closest platform is the Wii, which generated 24% of the total gaming revenue in 2009. And the PC share is growing – by 2013, the forecast is that PC gaming will represent 56% of the total pie.

It’s interesting to see that the growth in PC gaming revenue is predicted to come from the newer business models – subscription and online transactions. This matches my intuition – with piracy being difficult to overcome in the traditional games model, the newer business models are increasingly attractive. And a good chunk of that growth in the number of units of PCs out there is due to growth in developing markets. In those markets in particular, lower upfront cost models are extremely popular.

So, there are our estimates for the number of PCs out there versus consoles and the revenue generated from PC games. We think it paints a pretty compelling picture for developing games on the PC.

Now, tell us what you think!
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Jon Bullinger (Intel)'s picture

It's nice to see the PC market grow in gaming

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This year my sister has purchased 2 games online. Never once has she ever bought a game before. I like being able to buy a game online and download it but I wouldn't have a problem going into a game store and buying it. On the other hand with online purchases a option now my sister would buy a game online where before she would never even conciser it.

Mandy Mock (Intel)'s picture

I think the convenience is pushing many people towards online buying - it's so fast and easy

Matt Ployhar (Intel)'s picture

This is a good post Mandy!

More Game Developers, and would be (Indie) Game Developers should definitely pay attention. Both PC and Consoles are moving towards digital distribution so this really levels the playing field in terms of distribution, piracy & secondary sales concerns. However; the overall install base advantage absolutely belongs to the PC hands down in that scenario. Why pay a Console MFG money out of your pocket for the game you developed in that scenario? Doesn't make much sense to me.

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My opinion on pc gaming is this...I don't know what the statistics are exactly on how many people own a pc but I imagine that everyone who owns a console also owns a pc. However, people who don't own consoles, most likely own a pc. So in a market where people are still trying to save money wouldn't you rather make one purchase (pc) that does everything? On my pc I can check my e-mail, easily navigate the web, watch videos,create videos, edit videos, listen to music, messenger chat with most likely everyone I know regardless if they have the same brand of pc I have. Do homework and neccessary research for the such. I can go to Steam or a game publisher website and download practically any game. Plus you get access to sandbox editors and mod tools that you can't do on consoles. So I ask you this, when a console comes out and you pay $499 for it and that same year let's say you purchase a pc. The average person is going to spend about the same ($499) for their pc. So total that is $1,000. For that same price (some people can build them cheaper than that but I am talking about the average person) I could buy one item (pc) that plays the newer games plus everything else I described before all in one package.

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I am sorry to write this but Intel has never marketed graphics controllers with very good performances (for gaming) and 100% DirectX hardware compatibles.
Most of game developers works on ATI and NVIDIA graphics chips, many games are not compatible with INTEL graphics controllers, even now.
This problem has caused great harm to the PC gaming market given the number of PC with an Intel graphics controller.
Computers with Intel graphics controller are evil for the publishers technical support, because there are lots of technical problems.
And PC gamers do not know what exactly is the PC Gaming Alliance, they rarely hear this alliance.
Microsoft did not do much for the PC gaming contrary to Valve with Steam for example.
The PC can be a great market for video games since a long time now.
The problem has been always the hardware and the lack of support to game developers.

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Wow! I didn't know PC gaming was larger than consoles individually. I tought it was dying as a lot of people claim, but it's the other way around!

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Reading through these comments, some people need to remember the difference between a normal PC, and a PC capable of running most modern games to a degree where it's as (or more) playable as a game on a console.

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Well i think PC gaming is becoming a very big problem for most of the people and specially for those kids who love to do this. I have seen so many kids who prefer to play the PC games rather then the outdoor games. Those games are making our kids lazy and this is not at all a good thing for their future. In childhood kids need physical exercise, which is very important for their up coming future. Anyways thanks for posting.

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@Scooby doo games: If you wasted less time drinking beer outdoors then maybe you would at least know how to spell?