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A lucrative and transformative business model with potential beyond gaming and social networking
Many are wondering what to make of Zynga’s huge success in casual gaming. From its recent creation in 2007 to today, the company has quickly generated revenues in the hundreds of millions of dollars, mostly from selling physically nothing, but virtually everything.
Instead of spending about $30 per month for a subscription to an online game, many people are satisfying their craving for gaming by paying anything from 5 cents to $10 per transaction for individual virtual goods within the online world. And they are no longer just doing so on a PC or in a client-required 3D world, but on their phones and straight from their social networking sites.
With much smaller fees, or “micropayments,” and much simpler games, many more users are becoming involved in online gaming and paying to access more content within the otherwise free-to-play (FTP) online world.
In a recently-published in-depth report covering the entire industry, In-Stat has found that the revenue specifically generated from the sale of virtual goods has surged 245% to $7.3 billion this year from $2.1 billion in 2007.
Other findings include:
The top 10 virtual goods companies earn 73% of current worldwide revenues.
The emergence of social and casual games on social networking sites and mobile phones has created a 2D virtual goods market of close to $2.3 billion.
The Americas and EMEA regions now account for about 30% of all virtual goods sales, with Asia/Pacific representing the remaining 70%.
In-Stat forecasts total virtual goods revenues to reach more than $14 billion by 2014 and foresees that several legal and tax issues will create a new multimillion dollar market.
For a more detailed look at the report, check it out here.
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