Interactive gaming, console prices create Buzz at E3 - Retailing & Entertainment: Video Game Update - Electronics Entertainment Expo

DSN Retailing Today, May 5, 2003 by Doug Desjardins

"Now that there's a foothold Out there you're going to see some of the more successful console games move online ," said Richard Ow, senior account executive for the NPD Group. "I think you're going to see action games and sports games become the most popular genres, and online gaming will eventually become a separate animal."

Jupiter Research expects the online console gaming community to double this year. By the end of 2003, it projects that 2.1 million homes will have game consoles connected to the Internet and that 14% of all homes will be hooked in by 2007. Analyst David Cole estimates 23 million people will be playing online through consoles by 2006.

Just how garners will play and pay is still being ironed out. Microsoft charges players $50 for a starter kit for Xbox Live that includes a headset and one year of free access to any Xbox-enabled game they buy. Sony gives PS2 fans the means to access online gaming with its adapter, but allows game publishers and Internet service providers to decide how players pay.

But, as with any emerging technology on the Internet, success is no sure thing and there are stumbling blocks to getting garners online. "The most significant problem is that you need a broadband connection for online gaming and most homes don't have that connection in the same room where video game consoles are used," said Brian O'Rourke, senior analyst with In-Stat/MDR in Scottsdale, Ariz. "Most broadband connections are hooked to personal computers."

Even PC-based games with a huge following aren't guaranteed to replicate their success on the Internet. An online version of the popular PC game "The Sims" launched earlier this year but attracted only 100,000 subscribers in its first few months, far fewer than expected.