Game Industry Bigger Than Hollywood

Ant writes "This SF Gate story says stacks of new releases for hungry video game enthusiasts mean it's boom time for an industry now even bigger than Hollywood. The $10 billion video game industry, which generates more revenue than Hollywood, has never released so many highly anticipated blockbuster titles in a single season. It started in August with the game title Doom 3, followed by The Sims 2 in September, Grand Theft Auto: San Andreas in October, then Halo 2, Metroid Prime 2: Echoes and Half-Life 2 last month. In November, sales of video games rose to $849 million, an 11 percent increase from the same month last year and up 77 percent from October, according to the industry research firm NPD Funworld. The industry set a milestone last month when Microsoft's Halo 2 -- a sequel to a futuristic game with an elaborate plot that pits humans against invading aliens -- surpassed Hollywood's opening-weekend movie box office record in just one day of sales."

Apples and Oranges

[by Anonymous Coward]

People don't buy movie tickets months in advance for an opening weekend, so that's really not a fair comparison. This also doesn't take into account Hollywood's DVD sales which are quite impressive.

Re:Apples and Oranges

[bigman2003 (671309)]

Houses cost about $300,000, and can-openers are about $4. More can-openers are sold than houses.

But the real estate market is still bigger than the can-opener market.

Bleh

[Lord_Dweomer (648696)]

I know I speak for many here when I say that while I'm glad that the creators of my favorite games are making money, I'm dying inside when I think of what this ultimately means for the future of the games industry.

Re:Bleh

[Lisandro (799651)]

Mod parent up, please.

The problem is that when a new entertainment market starts creating serious money it becomes bastardized. Happened to music, happened to TV, happened to movies and rest assured, it will happen to games.

Hell, you could argue that it has already happened. A sign? All of the games in the list are sequels; which almost guarantees a base of sales. Some of them are good, some of them aren't, but there's hardly anything new or fresh offered in games nowadays; since seen genres with newer graphics are easy to sell we still see FPS, MMORPGs, GTA (which WAS fun, but i don't want to play the same game for the third time), sport simulations and so. Publishers simply go for the quick buck. I died a bit when Lucasarts canned the sequels for Sam & Max and Full Throttle to concentrate on Star Wars licences.

The only innovative thing i've seen from a major games publisher was Nintendo with it's DS; i haven't tried one yet but it looks good on paper and the touch screen and onboard WiFi are potentially great gaming aids. That could be a gateway to some interesting games, which knowing Nintendo, won't be too far away.

Re:Bleh

[MilenCent (219397)]

Hell, you could argue that it has already happened. A sign? All of the games in the list are sequels; which almost guarantees a base of sales. Some of them are good, some of them aren't, but there's hardly anything new or fresh offered in games nowadays; since seen genres with newer graphics are easy to sell we still see FPS, MMORPGs, GTA (which WAS fun, but i don't want to play the same game for the third time), sport simulations and so. Publishers simply go for the quick buck.

Well some of us have been saying this for years. If the game industry were, overall, as creative as they were back in the golden age, you can be there'd be a lot fewer Nintendo fanatics, myself included, these days.

But even my admiration for Nintendo has limits. Do you know what the most original company ever to produce video games was? The (in my opinion) answer may not be what you expect.

It was Atari Games, an entity that, in my mind, encompasses their early arcade output pre-split-up, and their later, post-split arcade games. So many of their hits were created out of whole braincloth, because there was absolutely nothing like them before. Atari was the most original not just because they were first, but because even as late as the early 90s they were still making incredibly different, fun games. Midway Arcade Treasures (1) has a good handful of them, including Rampart, which I've already bored far too many people discussing, some of them here.

But we can all see where that got them. They made Toobin', KLAX, Gauntlet, Marble Madness and (whimper!) Rampart, but gamers, more and more, became drawn to things like Street Fighter 2, a game that was admittedly well-designed, but inspired way, way too many sequels and knock-offs. It's not like Nintendo's sequels, where they'll throw out all but the core concepts and design a new game around them (example: Yoshi's Island is a direct sequel to Super Mario World!), but more like the same game, with new characters and modestly different rules.

Fighting games, depending on who you ask, are what saved or ruined arcades. My money's on "ruined." This is something of a digression, but it's worth noting that the fighting game boom was one of the contributing factors to the atmosphere of genrefication that are both what's enabled video and computer gaming to become big business, and what's sapped so much of the creativity out of the field.

Re:Bleh

[Lightwarrior (73124)]

> I exaggerated a bit...

A bit? I hate to break it to you, but there was *nothing* groundbreaking about FarCry. It was your standard Soldier of Fortune 2-esque FPS knockoff. The story was your typical "nazi scientist" drivel, the main character was, again, your typical no-nonsense hardcore spec-ops/government agent, the weapons were exceedingly average and typical, and finally, the much lauded AI was seriously wanting.

I played the game without reading the hype. I didn't experience anything special from the AI, so I started it up again on ultraextrahard (or whatever), and wandered around for a bit. As expected, the "tactic" of sniping one guy off and then gunning down his buddies worked flawlessly. Hell, after shooting one guy right next to a friend of his, his friend crept cautiously forward - no diving for cover, no wigging out and running, no going for reinforcements.

From my experiences, FarCry gets the award for "Most Overrated Game" this year. Sure, it was a decent FPS... but that was it. Doom 3, for all its linearity, at least had *suspense*.

And, simply put, you're either blind or running these games on a machine that an Xbox would put to shame. FarCry has "stunning" graphics while Half-Life 2's are "ordinary"? I'd suggest a trip to the optometrist or psychiatrist.

-lw

All sequels

[RedWizzard (192002)]

It started in August with the game title Doom 3, followed by The Sims 2 in September, Grand Theft Auto: San Andreas in October, then Halo 2, Metroid Prime 2: Echoes and Half-Life 2 last month.

Every one of these "blockbuster" titles are sequels. Is anyone doing anything new and exciting?

Re:All sequels

[thenextpresident (559469)]

Yes. Releasing sequels that are actually as good, or better, than the originals.

Something Hollywood finds next to impossible.

Re:All sequels

[fafaforza (248976)]

Ditto. I just saw Ocean's 12. What a God-aweful movie.

Re:All sequels

[T-Ranger (10520)]

I saw it last Monday. Im still waiting for something to happen.

Re:All sequels

[hunterx11 (778171)]

While it's true there's too much sequelism, it's different for video games than it is for films. Doom 3, for example, isn't even a sequel--it's a remake--but even if you hate it, you can't say it's just a rehash of the original Doom in terms of gameplay. I think a lot of it is just people wanting to cash in on established names. Hell, Super Mario Bros. 2 was an existing game they rebranded.

Re:All sequels

[Khuffie (818093)]

What's wrong with sequels? There's a difference between sequels churned out every year (ala EA), and sequels that really added some new cool things. Doom 2 was released years ago. So was the original Half-Life. Halo 2's been in the making for over 2 years. The original Sims been out for a while. The only games in that list that didn't fundementally change the gameplay were GTA:SA and MP2. In fact, all of those games, sequels or not, were in fact friggin' good games.

There's a difference between good sequels, and shoddy sequels which were just designed as quick cash machines. The Splinter Cell series and the latest Prince of Persia game are both guilty as charged, and basically any EA sports game.

Re:All sequels

[timster (32400)]

I'm tired of people saying this, because there is a fundamental difference between a movie sequel and a video game "sequel".

The thing with a movie is that the experience is always the same. You sit, and the movie goes for a while. Innovation in movies has to come in the form of new plot ideas and new characters and so forth. So sequels in movies are not usually very much appreciated because in many ways we have seen the movie already.

Video games provide a much more diverse range of experiences. "The Sims 2", for instance, will not be "The Sims" again. It could in many ways be a completely different game, and you can bet there will be new things for a player to learn. They could call it something completely different -- the fact that they re-use a well-known brand doesn't mean that they are making the same game again. There's no new plot or characters simply because there wasn't any plot or characters in the first place.

If you want an example of a Hollywood-style sequel in the video game world, consider the ".hack" series. All four games are basically the same, it's just a somewhat long game that is really expensive.

Gaming Industry Rise

[Fruvous (776606)]

Is it that suprising? A video game can offer so much more than an hour and a half movie. Not only that but the "sequal factor" really starts piling up. Look ever single game up there has been a sequal.

Re:Gaming Industry Rise

[gad_zuki! (70830)]

Its really about interaction isnt it? Movies are passive, the theater experience is mixed at best, etc. While I was playing Doom3 and Half Life 2 I would seldomly tell myself "Wow, this is pretty cinematic, its like a movie I'm controlling."

People like two way media. Look at us, we're posting on a big geeky weblog. Why? That's the question Hollywood can't address with its movies, celebrity star system, over-used CGI, and "safe/non-controversial" movies. I'm sure Joe and Jane Sixpack don't really care, but

Ahem...

[googleaseerch (682399)]

What about UT2004. I'm sorry, that was a blockbuster game too, if anything is.

Oooh, so piracy DOESN'T hurt sales..

[DroopyStonx (683090)]

That's what I thought...

Re:Oooh, so piracy DOESN'T hurt sales..

[oGMo (379)]

No, clearly, gamers are pirates, stealing money from the pockets and food from the plates of Hollywood executives!!

Re:Oooh, so piracy DOESN'T hurt sales..

[DroopyStonx (683090)]

You're responsible with it, at least.

I can't say the same for myself and a few others I know. I downloaded Doom 3 and GTA, but haven't actually purchased them yet. I will, I just haven't.

I think the only game I purchased from these blockbusters was Metroid Prime 2.

I'm not gonna try to justify it. I knew it was wrong, I did it anyway, but it's interesting to point out that GTA, Halo 2, Doom 3, and HL2 were ALL heavily pirated and available weeks ahead of time. Thousands upon thousands of people downloaded

A new form of entertainment taking over

[Faust7 (314817)]

The rich, detailed, immersive settings for what used to be entirely passive entertainment can now, with the current technology, be used for interactive entertainment.

All those wonderful spy-drama, fantasy, and sci-fi worlds that used to be the exclusive domain of movies? Now their realism is being delivered to you in a way that you can actually be in - if you're open to the experience.

Pitty the partners

[ricewind (690994)]

Somewhere, EA_Spouse is crying.

Recurring revenue, too...

[arashiakari (633150)]

MMORPG games such as World of Warcraft [worldofwarcraft.com] get a hit of cash up front and then involve monthly revenue. Hollywood has nothing like that.

Most games cost between $30 and $50, no-matter what platform you're buying for. How much is a movie ticket? $8 to $10 for tickets or $20 to $30 for DVDs. How much do games cost to make vs. the revenue they bring in?

1999 called...

[Billy the Mountain (225541)]

they want their headline back! [mediafamily.org]

BTM

In Other news...

[muntumbomoklik (806936)]

the MPAA and RIAA decide to sue game companies, citinglost revenue.

Piracy comparisons?

[Tzarius (688342)]

Doesn't it seem odd that an industry that would take more losses from piracy (i.e. a much higher percentage of users that already have the means and ability to pirate the products, and where the individual products are priced higher, providing further incentive for piracy) is making more money than the film industry, which should have a much larger customer base?

Or is it that the barrier-to-piracy on movies is a lot lower?

Re:Piracy comparisons?

[lachlan76 (770870)]

Video games have a much higher cost per unit.

Also, it's been established fairly well that piracy isn't hurting the movie industry.

Not quite

[Smerity (714804)]

As I heard at the AEAF (Australian Effects and Animation Festival), games sales may be higher, but the rights for Hollywood are much more flexible, for example.

Mainly, Hollywood can release a movie, get box office, sell the DVD, license the movie to networks, and sell other rights (for a TV show based on it, sequels), while a game sells and if it doesn't sell well, it's dead in the water

Book Industry: $23.4 Billion in 2003

[meehawl (73285)]

The Book Industry garnered $23.4 billion in 2003 [publishers.org] - and that was a flat recession year. When video games pass books in dollar volume, then we will know the end of civilisation is at hand.

Re:Book Industry: $23.4 Billion in 2003

[CaptainPinko (753849)]

it already has come. how much of those book sales were educated or artistically signifant? I bet the majority of them were pulp. In the words of Harvey Danger "The cretins are cloning breeding"... and apparently they are addicted to twitch-style video games.

Re:Book Industry: $23.4 Billion in 2003

[WIAKywbfatw (307557)]

But how many of those books were game guides and walkthroughs?

$10 billion

[fafaforza (248976)]

Wow.

I remember the time when the size of the gaming industry hovered around $5-$6 billion, as recently as year 2000. Anyone have a monthly or yearly chart that would show when the jumps occured?

EAbrace, EAtend, EAxtinguish

[ObsessiveMathsFreak (773371)]

This industry is ours. It's profits and technology will become one with our own. It's programmers will be hired and worked into mindless drones. Resistance is Futile. Surrender you IP and prepare to be bought out. Resistance is futile. People will buy our crappy games as long as we continue to pay retailers to promote them. Lower your morals and prepare to watch us take all of the billions that could have been yours. The comglomerate will prevail. Challenge Everything(TM), except our margins.

That's because...

[RiffRafff (234408)]

...game companies don't sue their customers.

I would much rather give a game for Christmas than a CD or DVD, knowing that my money is not helping to finance corporate lawsuits against thirteen year-old girls living with her single mom in HUD housing.

Nah. It's not bigger.

[Animats (122034)]

Not even close.

• World Console Software + PC Software, worldwide, 2003: US$18.5 bn [video-games-survey.com]
• Film industry revenues, worldwide, 2003: $180bn. [factbook.net]
• Music (audio & video) recordings, worldwide, 2003: US$32 bn [ifpi.org]

Hollywood films alone account for about $63 billion.

By comparison, IBM has revenues of about $80 billion per year.

The Smaller Screen

[Doc Ruby (173196)]

What exactly is this "Hollywood" that Matthew Yi claims is smaller than the $10B "Game Industry" in TFA? Maybe it doesn't include the $14B US ($32B global) record industry: a business run out of LA, mostly, and NYC, even if it's 80% owned in Tokyo/Sony, Berlin/BMG and Paris/Vivendi-Universal. Is it just movies (not TV, either)? The actual scale of "filmed entertainment" revenue (not including music videos, part of the "recorded music" industry) was $75.3B [pwc.com] globally, before the predicted 7.5% growth rate for 2004 (ie. $81B). Porn movies and website subscriptions alone have a global revenue of $8-10B [atimes.com]. Maybe video games are bigger than Hollywood the same way that John Lennon was bigger than Jesus [tripod.com].

Ignore This

[SJS (1851)]

Arg.

Ignore this post.

Moderating. Using pageup/pagedown to move. Didn't realize that this was also changing the settings from something positive (insightful/interesting/funny) to negative (overrated/etc.)

So, a post. This will, as I understand it, undo those moderations I have made. Oh, well. Better none than a false down. Hope this works.

Not just Apples and Oranges, just plain wrong!

[PenguinOpus (556138)]

Movies gross more than Games... always have, maybe always will. The stupid comparison made here is one that the game industry loves to make when trying to get mindshare... Compare movie box office versus game software/hardware sales.

If you include DVD/media sales of movies, movies win. If you don't include console hardware sales, movies win.

The movie industry (worldwide) grosses $180B. US movie industry grosses 63B. Box office only accounts for 26% of revenue.

reference: http://www.factbook.net/wbglobal_rev.htm [factbook.net]

Manny the Fat Stuntman says "Don't do it"

[gelfling (6534)]

The MPAA announced today that because fewer and fewer people actually watch their shitty movies, they've decided to sue people for doing anything else.

Re:Contrinutions

[iocat (572367)]

Not enough... The game industry is bigger than Hollywood, if you only count US boxoffice receipts. But these "game industry is bigger than Hollywood" claims always leave out the rental and DVD sales market.

Re:Contrinutions

[caspper69 (548511)]

Very true, and I was thinking the same thing when I read the blurb. Further, they don't include sales of DVD players themselves either, whereas the games industry most certainly includes the hardware sales dollars from dedicated consoles. Then you can also talk about international distribution and other market's native films, etc., etc.. Hollywood (and television in general) still makes many, many times what the videogame industry does.

Re:poor programmers

[by Anonymous Coward]

The poor programmers could always band together and form their own gaming company.

Sure, and a few engineers can always start their own car company. I wish them luck against the entrenched power of Detroit.

The original poster's point is that we are living in a second Gilded Age, a second age of robber barons. This age will end eventually, but the serfs will have to suffer a bit more before they start rebelling.

Re:Contrinutions

[fireman sam (662213)]

"Imagine how much the porn industry is worth...."

About $300+ per hour, it just depends on what you want them to do

Well, I think there's a cap to this market.

[skids (119237)]

I know I personally will not be needing to buy any more games for about a year, now that I have San Adreas. :-)

The better the games get, the less the appeal for the newer games. Movies wear out much faster.

Re:Not so fast, geekboys

[civman2 (773494)]

A family of five goes to see Spider-Man 2. A family of five buys Spider-Man 2 for the [insert favorite platform here] Where is that division again?

Another leveling factor

[SuperKendall (25149)]

Lots of people go to see movies they like multiple times. But how many people buy multiple copies of a game they like?

Re:Another leveling factor

[System.out.println() (755533)]

Lots of people go to see movies they like multiple times. But how many people buy multiple copies of a game they like?

While we're on the subject, how many people buy ONE copy of a game they like? ;-)

Re:Another leveling factor

[Ambassador Kosh (18352)]

Ask the people that play everquest that question. :) Many people that play MMOs have 2+ copies of the game. I have met some people that have 8 copies of the game, 8 copies of every expansion etc. It is pretty sick but people do it.

Re:Not so fast, geekboys

[St. Arbirix (218306)]

First figure out how many people would buy a movie at $50/unit. If that price reduces movie sales by more than 4/5ths then there's no need to talk. I think it would too.

Re:I still have games that I have not played...

[KingAdrock (115014)]

I'm curious. In NHL 2005 do you just sit there and watch an empty ice surface?

Re:I still have games that I have not played...

[geoffspear (692508)]

As a team owner in a video game, you get to do things that way you wish the idiot owners in the real world would do them. In most sports games, this involves not making or not making the trades that your favorite team made. Maybe in NHL 2005 it involves getting together with the other owners to fire the stupid commissioner and replace him with someone who knows more about hockey than basketball.