Interactive Entertainment Services To Reach $11.6 Billion In 2001

Posted on November 10, 1997

Driven by growing consumer spending, as well as increasing PC penetration rates and Web access, the market for interactive entertainment will reach $11.6 billion in 2001, a 112.9 percent increase over $5.5 billion in 1997, according to Interactive Entertainment 1998: Sizing The Market For Games & Recreation, a new research report published by Cowles/Simba Information.

With 1997 sales projected at $4.9 billion, PC and console-based entertainment titles, published by companies such as Sony, Nintendo, CUC Software and Electronic Arts, currently enjoy the largest market share. New technologies, including online games, DVD ROM and Internet TV, will grow quickly over the next four years, representing a combined $3.4 billion in sales by 2001.

"The online games and DVD ROM segments will contribute significantly to the industry's growth during the next several years as more consumers go online and DVD drives become standard on every PC," said report author Jennifer Doyle, an analyst with Cowles/Simba Information's New Media & Marketing Group. "Online games services, in particular, will be driven by growth in advertising revenue."

Online games services, a $58.8 million business in 1997, will reach $670 million in 2001. Advertising revenue, which currently represents 19.5 percent of the segment's revenue, will account for 37.3 percent - or $250 million - of revenue in 2001.

Cowles/Simba Information is a leading provider of news, analysis and market research reports on the media and industry information industry. Cowles/Simba Information is a unit of Cowles Business Media in Stamford, CT.