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Free to Play Market to Reach $2 Billion

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A new report by the research firm DFC Intelligence forecasts that the English language free to play market will grow from about $250 million a year today to over $2 billion by 2015. That’s an eightfold increase in five years. It’s worth mentioning that these figures only pertain to client-based free to play games. Throw in the browser based market and $2 billion looks like a low estimate!

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The study notes that despite the rapid growth rate for free to play games in the US, many Korean companies had actually expected even faster rates. But now that knowledge of the industry, and the high quality games it can produce is better understand, growth is expected to ramp up. The report states that there will be a combined total of 128 million English language registered users in the free to play space. I don’t know if that counts overlap between publishers, or if ‘English based’ means USA or the entire English speaking world.

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One interesting tidbit in the study is a remark concerning download speeds in the US compared to countries with much more developed free to play markets. Countries like South Korea, Sweden, Japan, and Romania enjoy much faster download speeds than users elsewhere which makes it easier for gamers in those countries to download game clients with large file sizes.

What does this mean for gamers? It means we’ll be getting a lot more free to play titles in more and more genres.

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DFC Intelligence Forecasts English Language Free-to-Play Games to Reach $2 Billion

A new report from DFC Intelligence forecasts that the market for English language client-based free-to-play (F2P) games on the PC is expected to grow from about $250 million in 2009 to $2 billion by 2015. This growth is largely due to widespread adoption of high-speed Internet connections combined with a growing willingness of consumers to buy digital content and improved payment options such as prepaid retail cards.

The F2P market has been firmly established in Asia for many years. According to DFC analyst Insun Yoon, “For many Korean companies the market in North America has not taken off nearly as fast as they expected. Much of this can be attributed to the immature infrastructure and a lack of established payment and service mechanisms. The good news is that this is starting to change and consumers are starting to realize that the game play of top high-end F2P games can be quite sophisticated.”

Most F2P games operate under a model where users can download and play a game for free and have the option to buy virtual goods or upgrade to a subscription package that opens additional play content. “F2P games can have multiple payment options and most successful games look to bundle products in creative packages such as the ability to buy a monthly or annual subscription that include a set amount of virtual currency. Creativity in marketing, packaging and distribution are the keys to generating increased revenue,” said David Cole, an analyst at DFC.

By the end of 2010, it is expected that English language client based F2P games will have a combined total of 128 million registered users. While this is not as high as many browser based games and games on social networks, F2Ps have fairly high conversion rates. “Registered user numbers are a fairly meaningless metric in this market. Once a consumer is able to get a game downloaded and running conversion rates for high-end F2P games tend to be fairly high,” says Yoon.

One major problem is that in North America and Europe it is still difficult for consumers to successfully install a large client. In conjunction with Pando Networks, a game delivery services company, DFC is providing a separate report on Online Game Delivery. This report shows that consumers in South Korea, Romania, Japan and Sweden have significantly higher download speeds than the rest of the world. According to the Pando report, eight of the fastest 12 cities in the world are located in Korea.

The new report entitled The Market for English Language Client-Based Free-to-Play PC Games has complete five-year forecasts, business model scenarios and detailed company profiles. DFC Intelligence also has several reports available surveying consumer attitudes on F2P and digital content in general. Subscribers to DFC’s research package services can get access to additional reports, consumer surveys, historical data, regular updates, more detailed breakouts by country and genre and the ability to search the DFC database and download data to Excel spreadsheets.

To sign-up for a free sample of the monthly DFC Dossier report, or an overview of DFC research, contact Ozzie Monge at omonge at dfcint dot com.

About DFC Intelligence

DFC Intelligence is a strategic market research and consulting firm focused on interactive entertainment and the emerging video game, online game, interactive entertainment and portable game markets. Since 1995 DFC has published in-depth strategic market reports and subscription-based research services. DFC research is used by over 300 leading companies in over 30 countries worldwide.

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