Copyright 2002

[ April 5th 2002 ]

Games console players are expected to provide the bulk of a 4bn windfall for software manufacturers over the next three years as Microsoft's Xbox challenges the dominance of Sony's PlayStation products. A report by research firm Datamonitor forecasts revenues from games will grow to 21.6bn dollars in 2004 - 22 per cent above last year.

The research will be welcome news for games publishers, in the doldrums for almost two years. The next three years are expected to be highly profitable. "Platform manufacturers will be heavily reliant on publishers, as a wide range of gaming content will need to be made available to support each platform," the report says. "This puts publishers in a very strong position, allowing them to dictate more favourable terms than has previously been possible."

John Roberts, chairman of UK-listed Rage Software, recently said: "The games industry is now beginning to show real growth as the next-generation consoles become mass market." Like many games makers, Rage has been investing heavily in new products for the expected surge in demand. It anticipates fierce competition between rival platforms. Software titles will be stepped up during the approach to Christmas. Fellow British games maker Eidos has signalled it intends to launch the next game in its Tomb Raider series - Lara Croft: The Angel of Darkness - for PlayStation 2 in November.

The Datamonitor research, published today, forecasts that Microsoft's Xbox will not present a serious threat to PlayStation 2, but will take the number two slot from Nintendo. The volume and back catalogue of games published on PlayStation 2 gives Sony a "significant advantage" over competition. "Early launch has given Sony sufficient time to build an impressive arsenal of games to supplement the hundreds of titles already available by way of its backward compatibility with previous versions of the console."

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