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(Report) VG Market Leaders 1995-2002 = Sony $36 Billion, Nintendo $32 billion

Research Breaks Down IE Market Leaders [7/13/2004 3:12:59 PM ET]

Research and Markets has released a new study entitled “Market Leaders in the Video Game and Interactive Entertainment Industry,” in which the market research company states that aggregate revenue growth increased 35.0 percent across the industry in the past fiscal year.
The report breaks down publishers into four sectors and outlines the prospects and hurdles faced by each company.

The first category, Market Leaders, features Sony, Electronic Arts, Nintendo and Microsoft. It’s noted that from fiscal 1995 to fiscal 2002, Sony reaped some $36.0 billion in revenues from the game business, versus Nintendo’s $32.0 billion across the same period. The report states, “The momentum is clearly on Sony's side. Nintendo has been consistently profitable, but their revenue has not significantly grown in the past ten years.”

The second category contains Capcom, Konami, Namco and Sega, a series of companies “faced with the problems of a declining arcade business and a slow Japanese economy. Their biggest challenge will be expanding on an international basis.”

Activision, Take-Two and THQ are lumped in a group labeled as “companies that have experienced strong growth on the strength of one or two very successful product lines.” Their challenge “is taking the earnings from their hit product line(s) and building a consistent, dependable revenue stream.”

The last category is made up of European firms— Eidos Interactive, Infogrames, Ubisoft and Vivendi Universal Games —who “have large product lines but face the challenging tasks of absorbing acquisitions, managing debt and building up a solid marketing infrastructure outside Europe.”

The full report, available here, can be purchased in electronic or hard copy form for $2,995.00.
 
clipunderground said:
heh. LOL. This has to be a mistake, right?


NOPE. Market Research and Financial Analyst reports cost a BUNDLE. They're not meant for consumers, but for companies. It's a huge deal for the (assuming decent analysis). For them to do their own research internally would be substantially more expensive just from a payroll perspective given the time it takes to compile such a report.
 

Deg

Banned
The above news tidbit is missing some details. I dont understand why sonycowboy cut bits out.


sonycowboy said:
NOPE. Market Research and Financial Analyst reports cost a BUNDLE. They're not meant for consumers, but for companies. It's a huge deal for the (assuming decent analysis). For them to do their own research internally would be substantially more expensive just from a payroll perspective given the time it takes to compile such a report.

Companies always use a mixture.

Here's a more detailed version:

http://home.businesswire.com/portal...d=news_view&newsId=20040713005714&newsLang=en

Research and Markets: Market Leaders in the Video Game and Interactive Entertainment Industry

DUBLIN, Ireland--(BUSINESS WIRE)--July 13, 2004--The Video Game Industry had a 35% aggregate revenue growth for the past fiscal year and an aggregate operating income in fiscal 2002 was 11.5% of revenue compared with an aggregate loss in fiscal 2001



Research and Markets (http://www.researchandmarkets.com) has announced the addition of Market Leaders in the Video Game and Interactive Entertainment Industry to their offering.

The good news for the video game industry was 35% aggregate revenue growth for the past fiscal year. Furthermore, aggregate operating income in fiscal 2002 was 11.5% of revenue compared with an aggregate loss in fiscal 2001. However, the report notes that these gains have not translated into stock price increases. We estimate that the average video game company's stock was down 51% from January 2000 to January 2003.

There is a significant difference in the prospects of each of the companies in the interactive entertainment industry. The report divides the companies into four categories. The first category consists of the four market leaders: Electronic Arts, Microsoft, Nintendo and Sony. These are the dominant companies in the industry.

The report notes that in the past five years, Sony has emerged as the leading force in the video game industry. From fiscal 1995 to fiscal 2002, Sony has reported $36 billion in revenue from video games, compared with $32 billion for Nintendo. On the other hand, Nintendo has reported significantly higher operating income. Nevertheless, the momentum is clearly on Sony's side. Nintendo has been consistently profitable, but their revenue has not significantly grown in the past ten years.

The second category of companies include the Japanese-based companies that have their roots in the arcade business: Capcom, Konami, Namco and Sega. These companies are faced with the problems of a declining arcade business and a slow Japanese economy. Their biggest challenge will be expanding on an international basis.

The third category of companies includes Activision, Take-Two Interactive and THQ. These are companies that have experienced strong growth on the strength of one or two very successful product lines. The challenge for these companies is taking the earnings from their hit product line(s) and building a consistent, dependable revenue stream.

The final group consists of the European companies that have grown rapidly through expansion: Eidos Interactive, Infogrames, Ubi Soft and Vivendi Universal Games. These companies have large product lines but face the challenging tasks of absorbing acquisitions, managing debt and building up a solid marketing infrastructure outside Europe.

This research report provides comprehensive information on the 19 leading companies in the video game and PC game industry. The report, Market Leaders in the Video Game and Interactive Entertainment Industry, analyzes each publisher's history, financial performance, the strengths/weaknesses of their corporate strategy, product lineup, development teams, marketing and distribution skills and future potential.

Market Leaders in the Video Game and Interactive Entertainment Industry is divided into 19 individual sections. The first section provides an overview and draws comparisons between many of the companies, including looking at revenue, income, expenses, assets, stock performance, market share and major acquisitions. The following 18 sections each cover an individual company.

Report Contents:

-- Overview

-- Company Analysis

-- Revenue Comparisons

-- Income Comparisons.

-- Operating Income Analysis.

-- Net Income Analysis.

-- Expense Comparisons.

-- Cost of Sales Analysis.

-- Sales and Marketing Analysis.

-- Research & Development Expense Analysis.

-- General & Administrative Expense Analysis.

-- Asset Comparisons.

-- Current Assets Analysis.

-- Cash Analysis.

-- Accounts Receivable Analysis.

-- Inventory Analysis.

-- Stock Market Performance Comparisons.

-- Market Value Analysis.

-- Stock Price Analysis.

-- Mergers and Acquisitions.

-- Market Share.

For more information visit http://www.researchandmarkets.com/reports/c2675
 

Deg

Banned
Must be really tough getting video game performance data

This report is more than a collection of raw statistics. We carefully scrutinize and analyze data from a variety of sources. The result is a comprehensive overview that puts facts and figures in context. Anyone who has attempted to collect figures for the game industry knows
that is difficult to obtain accurate statistics. We have studied market surveys, investment analyst reports and other sources of industry information. Our statistics and forecasts are based on the careful analysis of the available research, a great deal of which is contradictory. In many cases, we made assumptions based on the best available information. We feel our figures accurately reflect past and future market conditions. At the very least, these numbers track the industry trends and accurately estimate the market share of the various players.

A major challenge in analyzing the interactive entertainment market is imperfect data. There are several services that track software sales for individual markets around the world. These include the NPD Group/NPD Funworld/TRSTS service that tracks U.S. sales (in February 2004 they started covering Canada), NPD Techworld (PC Data) for PC game sales, ELSPA/Chart-Track for the U.K., AC Nielsen Canada, Media Control and GfK in Europe. Japan data is available from several services including Media Create and the magazines Famitsu and Dengeki (owned by Kadokawa Shoten).

The problem in tracking the market on a worldwide basis is that the retail tracking services focus on individual markets and are only obtaining samples from a portion of each market they cover. Thus the services are best used for tracking how well a given title is doing in a given market compared to other titles in that market. Extrapolating retail sales data to obtain an overall market figure is never 100% accurate and always subject to debate. DFC Intelligence has looked at reported sales data for different markets and compared that to with reported sales from individual companies based on talking to company executives and looking at relevant investment information including SEC filings. The end result are numbers that we feel give a fairly accurate picture of trends in the interactive entertainment industry. However, we caution users that actual results may vary. In addition, fluctuations in exchange rates can affect overall results on a worldwide basis.
 
sonycowboy said:
The first category, Market Leaders, features Sony, Electronic Arts, Nintendo and Microsoft. It’s noted that from fiscal 1995 to fiscal 2002, Sony reaped some $36.0 billion in revenues from the game business, versus Nintendo’s $32.0 billion across the same period. The report states, “The momentum is clearly on Sony's side. Nintendo has been consistently profitable, but their revenue has not significantly grown in the past ten years.”

doomed
 

Deg

Banned
The report notes that in the past five years, Sony has emerged as the leading force in the video game industry. From fiscal 1995 to fiscal 2002, Sony has reported $36 billion in revenue from video games, compared with $32 billion for Nintendo. On the other hand, Nintendo has reported significantly higher operating income. Nevertheless, the momentum is clearly on Sony's side. Nintendo has been consistently profitable, but their revenue has not significantly grown in the past ten years.

compare this to what Sonycowboy posted. Bold bit got cut out ;)
 

explodet

Member
The report notes that in the past five years, Sony has emerged as the leading force in the video game industry. From fiscal 1995 to fiscal 2002, Sony has reported $36 billion in revenue from video games, compared with $32 billion for Nintendo.
DOOMED
On the other hand, Nintendo has reported significantly higher operating income.
NOT DOOMED
Nevertheless, the momentum is clearly on Sony's side.
DOOMED
Nintendo has been consistently profitable,
NOT DOOMED
but their revenue has not significantly grown in the past ten years.
DOOMED
 

Link316

Banned
while Nintendo might've made more profit overall (mostly thanks to Pokemon), its been on the decline and they've even had 2 quarters of losses last fiscal year, it also would not surprise me if they report losses for Q1, Q2 and Q4 of the current fiscal year
 

Jumpman

Member
Link316 said:
while Nintendo might've made more profit overall (mostly thanks to Pokemon), its been on the decline and they've even had 2 quarters of losses last fiscal year, it also would not surprise me if they report losses for Q1, Q2 and Q4 of the current fiscal year

It says that Nintendo had no significant increase in revenue. That means sales were either flat, or there was a small insignificant increase in revenue. Nintendo's sales have remained stable. Don't try to exclude Pokemon when you talk of Nintendo's success or failure. Pokemon is a part of Nintendo, as is Mario, Zelda, etc. Saying, 'if it wasn't for Pokemon is stupid'. It's like saying, "you know, Microsoft really isn't that successful if you take away Windows, or Office. Nintendo has shown a consistent ability to create successful franchises. There is no reason to believe that they won't continue to do so.

The fact that Nintendo has been able to make more profit in the games business than Sony is incredible. It is a tribute to the way they do business. One can't help but wonder what their marketshare would look like if Nintendo was willing to take more risks.
 

human5892

Queen of Denmark
Jumpman said:
The fact that Nintendo has been able to make more profit in the games business than Sony is incredible. It is a tribute to the way they do business. One can't help but wonder what their marketshare would look like if Nintendo was willing to take more risks.
Seriously. The fact that Nintendo can come in a relatively close second place behind Sony when Sony has absolutely dominated the market in the time period in question is nothing short of astounding.

Say what you want about their sometimes questionable tactics as far as satisfying the masses, but when it comes to running a tight ship, Nintendo rules them all.
 

jarrod

Banned
Link316 said:
while Nintendo might've made more profit overall (mostly thanks to Pokemon), its been on the decline and they've even had 2 quarters of losses last fiscal year, it also would not surprise me if they report losses for Q1, Q2 and Q4 of the current fiscal year
Actually, aren't all Pokemon licensing/software reported under the Pokemon Company and not Nintendo? For tax reasons?
 

Link316

Banned
Jumpman said:
The fact that Nintendo has been able to make more profit in the games business than Sony is incredible. It is a tribute to the way they do business.

its more of a tribute to their greed, they only make more profit because they have higher margins due to do charging publishers and consumers more than Sony does, from things like higher license fees to their more expensive Player Choice games to their GBA NES games, these things all add up after awhile
 

AirBrian

Member
jarrod said:
Actually, aren't isn't all Pokemon licensing/software reported under the Pokemon Company and not Nintendo? For tax reasons?
PC is a subsidiary of Nintendo. IIRC, they are counted in Nintendo's financial statements.
 

jarrod

Banned
AirBrian said:
PC is a subsidiary of Nintendo. IIRC, they are counted in Nintendo's financial statements.
PC is an invested subsidiary though, Nintendo doesn't own 100%. Just like Konami owns a chunk of Hudson, Takara, Atlus, Genki, Success (and a ton of other companies), Sony owns a chunk of Square Enix and even Nintendo owns a chunk of Bandai.
 

AirBrian

Member
http://www.nintendo.com/corp/report/fiscal2004.pdf
Nintendo Co., Ltd. ("the Company") and its related companies, which are composed of the Company, twenty-one subsidiaries, and nine affiliates as of March 31, 2004, operate manufacturing and distribution of electronic entertainment products as a major business. Chart of business by the Company and its related companies are as follows.

Entertainment Products (Distribution)
(a) Nintendo of America Inc.
(a) Nintendo of Canada Ltd.
(a) Nintendo of Europe GmbH
(a) Nintendo France S.A.R.L.
(a) Nintendo Benelux B.V.
(a) Nintendo España, S.A.
(a) Nintendo Australia Pty. Ltd.
(a) Nintendo Phuten Co., Ltd.
(a) Nintendo Services USA, Inc.
(d) Pokémon USA, Inc.
(d) iQue Ltd.
(d) iQue (China) Ltd.
(d) The Pokémon Company
I know what you're saying. Looking at their annual report however, they talk about Pokemon's effect on revenue/income. So I don't know. I can't seem to find what the (a) and (d) stands for.
 

Nicco

Member
Nintendo did not report growth as opposed to Sony, which entered the videogame market in 1995? How do you enter this industry and not have growth? *Looks at Microsoft* Nevermind.

I'm not really surprised Sony had made $36 billion and Nintendo made $32 billion. The PS2 has always been at least $50 more than the GCN and the licensing fees collected from third parties must be a small fortune for Sony over the time covered in the study.

Moreover, it's obvious that both are major players anyway so it doesn't matter who is bigger. You don't see Bill Gates and Donald Trump getting into cock-measuring contests. Who's is bigger? Well when you're slapping those Italian sausages on the table the difference is marginal. Excuse the colorful imagery.
 
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