Xbox 360 Could be 'Distant Third' By 2009

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DFC predicts the game industry as a whole could generate $47 billion that year.
According to a series of recent reports by the research group DFC Intelligence, the game industry is poised to see enormous overall growth in 2009, just in time for the Xbox 360 to slip to a distant third place in the console race.

DFC estimates that the videogame market will swell to $47 billion by 2009, a 42 percent increase over the $33 billion generated by the industry in 2006. That forecast includes revenue from videogame hardware and software, dedicated portable system hardware and software (i.e. the DS and PSP - not mobile phones), PC games, and online PC and console games.

But the Xbox 360's selling power could be on the wane, according to DFC's research. The company has raised its forecast for the Nintendo Wii and PlayStation 3 and lowered its forecast for Microsoft's console, predicting that the Wii will stay on top at least through 2008 and that the PS3 will move into overdrive in 2009.

"The Xbox 360 will need to build a strong base outside North America to avoid being in a fairly distant third," said DFC analyst David Cole. "We could have a situation where the Wii sells more hardware units, but by 2012 the PlayStation 3 is generating more software revenue."

Using three separate market forecasting models, DFC estimates that combined cumulative worldwide sales for the three console systems will reach between 180 million to 210 million units by 2012.

But home consoles won't be the only winners, according to DFC. The PC market, spurred by the success of online games and digital distribution, stands to grow to $13 billion by 2012, the research indicates. Previous DFC estimates put the online PC game market at about $4.5 billion in 2006.

Handheld systems and software are also strong performers and Cole predicts that "the Nintendo DS could eventually become the best-selling game system ever in five years."



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