Next Generation Video-Game Consoles to Outsell All Previous Platforms, Reaching $35bn by 2008 Says Juniper Research

BASINGSTOKE, ENGLAND - Additional features and functionality are set to transform the next generation of video-game consoles into intelligent home media centres. The leading developers across the sector have revealed to Juniper Research their ambitious plans to integrate high-speed Internet gaming, wireless connectivity between machines and handhelds, as well as other new entertainment functions.

Due for launch from early 2005, the big three manufacturers (Sony, Microsoft & Nintendo) are racing to develop and launch the next winning platform. New competitors are also hoping to take a slice of the new wider market.

Keri Allan, Games Specialist at Juniper Research found that "The next generation of machines will take a leap into the world of convergence and offer gamers a home media centre rather than just a gaming machine. Graphics and speed will evolve, but connectivity between devices will also come to the forefront. This functionality will help consoles to finally become a mainstream entertainment medium, and put the stereotypical image of the 'computer gaming geek' to rest."

The new study also reveals:

- Online gaming from video-game consoles will reach almost 28m regular users by 2008, as always-on broadband access achieves significant penetration across the developed world. The downloading of new games and levels will also become mainstream.

- Next generation handheld hardware revenues are forecast to reach $25bn by 2008. Competition and price pressure will increase in this sector, as Nintendo (the leader) faces new launches from Sony, and other new machines such as the Gamepark and Zodiac.

One short term issue that the games sector is already beginning to face is a reduction in demand for the current generation of games platforms. This will become an increasing problem for the sector as the release of the new platforms approach. "Price drops, bundling and add-ons will continue to be in favour, but savvy users will increasingly be holding-off making a purchase until the new hardware is ready in 2005," Keri noted.