LEIPZIG, Germany (Reuters) - The market for video games is expected to expand by half over the next four years as it extends beyond hardcore gamers, the chief executive of French video game publisher Ubisoft (UBIP.PA) said on Wednesday.
“There are so many new customers to the business; this is going to grow the market tremendously. I expect the market to grow by 50 percent in the next four years,” Ubisoft CEO Yves Guillemot told Reuters at the sidelines of the Games Convention in Leipzig.
“It’s a very exciting time for all the developers and publishers,” Guillemot said.
Electronic Arts ERTS.O, the world’s biggest video games publisher, was similarly bullish about the prospects for more people to play games on consoles, PCs, mobile phones or on the Web.
“There are 150 million gamers worldwide, but 2 billion people are ready to play,” EA’s managing director for Germany, Thomas Zeitner, told a news conference.
Driven by the runaway success of Nintendo’s 7974.OS motion-controlled Wii console, so-called casual games that are targeted at families, older players or women have become the industry’s new buzzword.
Ubisoft, known for its realistic military games, on Wednesday announced a new title in its “Games for Everyone” range. “Cranium Kabookii”, based on the award-winning board game Cranium, will be made for Nintendo’s Wii console and is slated for a December release.
Guillemot said the company’s casual games business was “extremely profitable” and helped to finance the initially costly development of games for next-generation consoles — Sony’s (6758.T) PlayStation3 and Microsoft’s (MSFT.O) Xbox 360.
According to the Ubisoft CEO, developing a casual game costs anywhere between 1 million to 4 million euros depending on the number of platforms with which it is compatible.
By comparison, a normal game developed for the Wii costs 5 million to 10 million, and one designed for use with the PlayStation3 and Xbox 360 10 million to 20 million euros.
Casual games are expected to contribute 20 percent of Ubisoft’s revenue this year, up from 10 percent last year, Guillemot said. Ubisoft has forecast revenues of about 825 million euros for its financial year until March 2008.