Broadband use rises with gaming growth, but carriers may have limited opportunities beyond bandwidth, according to Light Reading Insider

February 1, 2006

3 Min Read

NEW YORK, February 1, 2006 – Online gaming is poised for significant and sustained growth over the next four years, but operators of broadband networks may not see substantial benefits from that growth, according to a new report released by the subscription research service Light Reading Insider (www.lightreading.com/insider).

Online Gaming: Invasion of the MMORPGs delivers a timely overview of online gaming's development and expected growth in key consumer markets worldwide, focusing on massively multiplayer online role-playing games (MMORPGs), which have emerged as the online gaming genre with the most revenue potential. MMORPGs are driving consumer uptake of online gaming services in several critical markets, including the U.S., China, Japan, and South Korea.

But while the increased availability of broadband network services is enabling the emergence of MMORPGs, operators of those networks aren't likely to see much incremental revenue growth from MMORPGs beyond what they get simply from providing broadband service, notes James Crawshaw, Contributing Analyst for Light Reading Insider and author of the report.

"By developing game portals and communities, telecom operators could also sell gaming content and services," Crawshaw explains. "However, to put it in perspective: If Verizon (NYSE: VZ) were to sell its $8 per month game network service to a quarter of its 4.5 million broadband subscribers, this would generate about $100 million of additional annual revenue – approximately 0.3 percent of the company’s current fixed-line revenues.

"Online gaming is big business, just not for the carriers," Crawshaw concludes.

Other key findings of the report include:

  • Global online gaming revenues grew to $3.5 billion last year and are expected to grow another 40 percent in 2006.

  • Telecom revenues associated with online gaming in China are estimated to be six timesthe revenues from game subscriptions themselves.

  • Microsoft's Xbox Live platform has helped popularized online gaming.

Online Gaming: Invasion of the MMORPGs, a 14-page report, is available as part of an annual subscription (12 monthly issues) to Light Reading Insider, priced at $1,350. Individual reports are available for $900.

To subscribe, or for more information, please visit: www.lightreading.com/insider.

For additional information, to request a free executive summary of the report, or for details of multi-user licensing options, please contact:

Jeff Claudino
Sales Manager
Insider Research Services
619-229-9940
[email protected]

For press inquiries, members of the media may contact Gabriel Brown at [email protected].

About Light Reading
Light Reading Inc., a wholly owned subsidiary of CMP Media, is a B-to-B network information provider. Light Reading publishes www.lightreading.com, the leading global content site for the telecom industry; www.byteandswitch.com, a storage networking site; and www.unstrung.com, dedicated to wireless networking. Light Reading is also affiliated with www.heavyreading.com, a market research site for quantitative analysis of telecom technology to carriers, service providers, and vendors.

About CMP Media
Through its market-leading portfolio of trusted information brands in the technology, healthcare, and lifestyles industries, CMP Media has earned the confidence of more professionals and enthusiasts in these fields than any other media company. As a result, CMP is the premier provider of access, insight, and actionable programs designed to connect sellers and buyers in each of these industries in ways that yield superior return on investment.

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