August 19, 2011

German Video Game Market Thrives Despite Economy

German video game consumers seem to be unfazed by the economic worries, still spending euros during uncertain times.

The gaming industry has been a bulwark for entertainment sector during periods of a struggling economy.

"People yearn for entertainment in the good and bad times and probably more in the bad times so the impact is low," Uwe Bassendowski, Managing Director for Germany of Sony Computer Entertainment, the division responsible for the PlayStation 3 console, told Reuters.

He said the gaming industry was unlikely to feel the effects of another possible recession in the U.S.

"We are in a very comfortable situation because consumer confidence is there and the market is developing positively," he told Reuters.

Sales of PC and video game software and income from online business models jumped 1 percent in Germany in the first half of the year, according to Germany's Federal Association for Interactive Entertainment Software shows.

"Up to the end of the year we are expecting slight growth in turnover of up to 3 per cent in total," Olaf Wolters, Managing Director of the association, told Reuters.

Reuters reported that company executives showed little concern of a potential recession in the U.S. could affect the German gaming market.

IHS Screen Digest analyst Steve Baily said increasing the number of "fermium" games could help shield the industry from a possible recession as well.

"With these service-oriented online games providing such economical entertainment, as well as major packaged franchises finding ways to engage players for longer, it's difficult to argue that games will suffer harshly during a near-future downturn," he told Reuters.

Despite the growth of the gaming industry, Germany's console market was "between stagnating and slight declining," according to Oliver Kaltner, General Manager of Consumer and Channel Group at Microsoft Germany.

Reuters also reported that Mark Cerny, President of Cerny Games and an industry consultant, said a decline in the global core console games business by 10 to 20- percent in the last two years was just "a benign market readjustment in the face of competition from the iPhone, iPad, and free to play games."


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