Week Two: Boston Consulting Group Video Games

Technology today is evolving at an alarmingly fast pace. Our machines are becoming outdated quicker than ever before and new advances deem our "old" machines obsolete. Right now in the video game industry, we see the market shares become increasingly more dominated by mobile and handheld devices such as mobile devices and touch pads. Gaming is moving into that direction at an alarming and consistent rate. According to Nick Bilton, found in the New York Times, "the fastest growth is likely to come in mobile gaming, said Tuong Nguyen, principal research analyst at Gartner and co-author of the report, in an e-mail interview. He predicted that the sales and use of hand-held gaming consoles, including those made by Sony or Nintendo, would slow as young gamers opted for a smartphone or tablet instead of a dedicated gaming device." The market share for mobile devices presently is about 10 percent of the video game market and is expected to double in 5 years. "Mobile gaming will grow “from 15 percent in 2010 to 20 percent in 2015,” according to the report, the largest amount of growth compared with other gaming platforms." 

The effects this shift has on the XBox continues to cause concern. "The shifting demand toward tablets is worrisome to Microsoft because most tablets run on Apple’s operating system or on Google’s Android software. Tablet manufacturers have shown little interest in adopting Windows, leaving Microsoft out of what some of its executives had thought was a niche product. Sales of tablets are expected to triple to 43.6 million units in 2011 from a year earlier, according to eMarketer, a market research firm" (Verne G Kopytoff). Although, I do believe that XBox does have a chance considering the direction they are going with Internet gaming and the obvious progression to Internet TV that we are starting to see as coming in the near future.


Sony has had a steady decline. One main reason was a system hack in early 2011 which caused them to take a 2.08 billion dollar hit." Sony’s PlayStation Network was infiltrated by hackers who gained access to highly sensitive information about its customers. The gaming network has 77 million registered users.
When you step back and take a look at the market share and industry as a whole, we see that specific companies outshine all around, not just in one area but taking the cake as a whole and moving with the flow of progression, not getting stuck in the tides of change.  Taking the Boston Consulting Group method into consideration, we can determine which role each of the denominations takes. The four most prevalent video game entities being 1) Nintendo, 2) Sony 3) Microsoft and 4) Apple (mobile devices).  The highest market growth rate and high market share seems to be within Apple and mobile devices, which makes them the emerging Star.  The Cash Cow in this situation with the highest relative market share and low growth rate is Nintendo.  The Question Mark, the company with a High market growth rate, and low relative market share is Microsoft (XBox).  Then, lastly, the Dog, the company with the Lowest market growth rate and relative market share is Sony (Playstation). 

Video Game Industry Statistics
Apple iPhone & iPad Video Game Market Share 
Although Sony said its users’ credit card information was encrypted on its servers, hackers claimed to have access to 2.2 million credit cards and were hoping to sell them on a underground hacker networks. The committee has asked Sony to divulge what type of personal information was actually taken during the attack" (Nick Bilton). This is an extremely huge drawback and hit for Playstation users, even though as of now it is still widely used, it seems that for the future it is possible to face a decline, especially with the innovations underway.