PART II – INDUSTRY ANALYSIS
Principles of Marketing
The Video Game Industry –
Sony PlayStation 4
Submitted to: Prof. Ernesto Arpon
The video game industry is considered to be the biggest form of entertainment. In a global scale, it outmatches the TV, Music, and Film industries. Because video games are this popular, governments from various countries all over the world have expressed their support for the industry.
In the Philippines, the first company that focused on solely creating video games is the company Anino Games. This company was founded way back 2001. Ever since, video gaming has become known to many Filipinos. In 2007, an organization called Game Developers Association of the Philippines (GDAP) has been established. The purpose and objective of this organization is to promote the country’s game development industry. The said industry has been receiving sponsorship of events and activities by the Government. But this support is not enough according to Alvin Juban, the President of GDAP.
The three major players of the video game industry are Nintendo, Sony, and Microsoft. Nintendo was known for being the first ever company to introduce the first handheld console to the world in the year 1989 – the Game Boy. Sony is known for its high quality gaming console which is the PlayStation. But Sony was not satisfied, and thus they came up with the next PlayStation, the PlayStation 2, 3, PSP, PSP Vita, and the PS4 which is still a widely known console compared to Sony’s first console. Lastly, Microsoft is known to produce another well-known gaming console, which is the Xbox. All these Gaming Console Companies or players have greatly affected the video game industry, for it is because of them that playing video games had become popular.
1. Wii U (Nintendo)
1. Mobile applications
2. Xbox One (Microsoft)
2. Social Media apps
3. PS4 (Sony)
Market size or Market potential of PS4
In 2013, Sony managed to have over 60 percent market share over its competitors, occupying almost two-thirds of the market. It would appear that the PS4 is outselling the Xbox One by some margin, but the bigger picture is actually a lot more complex than that. As of December 28, 2013, the PS4 had been on sale for 43 days and sold 4.2 million units. By December 28, the PS4 was available in 48 territories. If we divide 4.2 million by 43 days, we get a figure of around 98,000 units sold per day. Unlike that of Xbox One was available in 13 territories. 3 million in 39 days equates to around 77,000 units per day. From these figures, it’s clear that the PS4 is outselling the Xbox One. Even if you gave the Xbox One another week to catch up, to make up for the PS4′s earlier release, we’d still only be looking at 3.54 million Xboxes vs. 4.2 million PS4s. The Xbox One is only available in 13 countries and territories, while the PS4 is currently available in 53. It is evident that Xbox could catch up when it become more widely released, it will catch the PS4 in sales. If we look beyond the numbers, though, both consoles are doing really, really well. Despite being in second place, the Xbox One is still doing much better than the PS3 or Xbox 360. In fact, the PS4 and Xbox One seem to be the two fastest selling video game consoles of all time.
Trends / Issuer development
The next console generation is going to look markedly different to the current. How? First, Xbox One and PS4 are designed to be constantly connected to the internet. Game-makers are now going to be assuming you’re online. You may not have to be to play, but you will if you want to use all the social networks you’ve implanted into your brain. Get used to it. Second, Free-to-play will become normal to console users within...
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