Smartphones/Tablets Pushing Handheld Gaming Devices Aside
June 11, 2012 11:06 AM
Handheld gaming device shipments are expected to slow and even decline in 2013 and beyond while tablet/smartphone shipments continue to soar
Mobile devices are certainly taking over the tech world, but not just any mobile devices -- smartphones and tablets are slowly pushing handheld gaming devices out of the spotlight.
A new study conducted by ABI Research shows that more portable gamers are looking to
smartphones and tablets
for their gaming needs rather than handheld gaming devices like Nintendo's 3DS and Sony's Vita.
According to the study, both Nintendo and Sony are expected to ship over 38 million portable gaming devices in 2013. After that point, unit shipments are expected to continue declining slightly and then remain "flat" through 2017.
The 38 million-unit shipments in 2013 is a dramatic fall from the 47 million-unit shipments in 2008. Expert analysts say that smartphones and tablets are moving in on this sector, offering mobile games that are much cheaper right on the devices they use on a daily basis. However, core gamers will still keep Nintendo and Sony's gaming sales afloat.
"Mobile devices will compete with dedicated handheld gaming devices, but select consumer segments like core gamers and those individuals who do not want or have a smartphone or tablet will still provide some demand," said Michael Inouye, senior ABI analyst. "The addition of mobile gaming is not necessarily a zero sum situation; in fact, many feel there is plenty of room in the gaming market for both portable and mobile gaming.
"The mobile and tablet markets have increased consumers' price sensitivity. First party developers and key game franchises will be vital cogs for the industry in the future, since hardware alone is not going to cut it given the shorter upgrade cycles for mobile devices."
This was clearly demonstrated last year when Nintendo's 3DS launched for $249.99 and initially didn't sell very well. In July 2011, the gaming company reported poor financial results, posting a net loss of 25.5 billion yen ($324 million USD) and decided to
slash the 3DS' price to $169.99
starting August 12.
In April of this year, Nintendo posted its
first annual loss ever
with an operating loss of 37.3 billion yen ($460.9 million USD) and a net loss of 43.2 billion yen ($532.5 million USD).
However, it looks like Nintendo is still doing all right. In March of this year, the company celebrated the
3DS' birthday with a 4.5 million sales milestone
. Sales for the device picked up after the price slash and when more impressive titles were released.
In addition, Nintendo recently introduced its own social network,
which is to be released with its upcoming Wii U console release.
While gaming companies like Microsoft's Xbox division and Sony's PlayStation unit still seem to attract core gamers, mobile devices have a bit of an advantage in that they can capture the attention of both casual and core gamers. Smartphones tend to be used by a larger audience, since carrying a cell phone on a daily basis is more common than someone carrying a 3DS. When we're not using it for phone calls or the Internet, gaming apps are a popular pastime, and they're convenient because they're right on our phones. They're also cheap, and many times even free.
Also, many new tablets and smartphones are released annually, giving consumers many choices for different price ranges. For instance, Apple has released a new iPad each year since its initial release in 2010. During the first quarter of this year,
had 11.8 million total shipments.
Last year, Rovio CEO Peter Vesterbacka, creator of mobile game Angry Birds, said that
console games were dying in favor of mobile games
because of how expensive console games are and the slow rate of system upgrades.
"And boy have we patented it!" -- Steve Jobs, Macworld 2007
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