Sam Adkins-Ambient Insight

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"The 2012-2017 Worldwide Game-based Learning Market"

In this session, the audience will be provided with the five-year revenue forecasts for Game-based Learning broken out by seven international regions. Special attention will be given to North America and Asia. The session will identify the buyers, the products they buy, and the money they spend on those products.

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  • Ambient Insight founded in 2004 by Microsoft Training and Certification veterans that built the Microsoft Online Institute (MOLI)International “boutique” analysis firm specializing in quantitative analysis, learning technology forecasts, M&A analysis, and competitive intelligence Ambient Insight tracks learning technology buying behavior across the planet. We have buying behavior profiles for over 100 countriesAmbient Insight…Does not evaluate, compare, or rank the effectiveness of learning technology products Does not endorse or promote companies or productsWe are the only analyst firm that whose focus is entirely on Learning Technologies – produce syndicated and custom reports.We don’t compare or rank, award or reward, endorse or promote – any company or product. WHO ARE YOU?- DEVELOPER? EDUCATORS, PUBLISHERS, OUTSIDE USWho came the furtherest?
  • Trying to analyze Game-based Learning as a subset of the vast videogame industry is a daunting task (“impossible” some videogame industry analysts have said)Game-based Learning revenues amount to a 2-3% rounding error in the huge global videogame industry
  • Services are for both mobile and non-mobile so no way to break that out.
  • Virtual worlds that embed edugames illustrate the difference between Simulation-based Learning and Game-based Learning. The "environment" is indeed simulated but the knowledge transfer method is game-based. In Simulation-based Learning, the simulation itself is the knowledge transfer method.
  • Ambient Insight does not include high-end military, aviation, and heavy equipment simulator revenues in our forecasts. The barriers to entry are quite high to develop and market these machines and only a handful of suppliers can compete in the simulator market.
  • Virtual worlds that embed edugames illustrate the difference between Simulation-based Learning and Game-based Learning. The "environment" is indeed simulated but the knowledge transfer method is game-based. In Simulation-based Learning, the simulation itself is the knowledge transfer method.
  • Revenues concentrated in the US and Western Europe in the corporate and healthcare segments.
  • Revenues concentrated in Asia and consumers
  • Services are for both mobile and non-mobile so no way to break that out.
  • Revenues concentrated in Asia and consumers
  • Language learning dominates the adult segment.
  • Worldwide – these are the catalysts – different for every region – e.g. in Asia, it’s Booming market for VAS, tablets in academic segment & personal learning devices in consumer segment– but, 2 ones specific to Asia and some other regions: leapfrogging the PC experience—smart mobile broadband networks, and device makers & telecoms driving the market – revenue & innovations. VAS Consumer demand (English language learning)  tablet & PLD adoption  Location-based Learning  integration with mHealth (also a consumer need)Direct billing is now a major catalyst –relatively newTelefónica operates in twelve of the fifteen countries analyzed in this report and has over 212 million subscribers in the region. In 2012, Telefónica announced direct billing agreements with Microsoft, Facebook, and RIM (now rebranded as BlackBerry.) In May 2013, they announced a global direct billing agreement with Samsung. "Under the terms of the global framework agreement, Samsung Hub and Samsung Apps’ customers will be able to purchase apps and music, video, books, games and learning services from their devices by simply charging the payment to their phone bill." Telefónica's deal with Samsung allows subscribers to make purchases in Samsung's dedicatedLearning Hub store and be billed directly by Telefónica. Samsung's Learning Hub store launched in February 2012 with "6,000 free and paid learning units in collaboration with some 30 domestic and foreign education services companies." Samsung is targeting both schools and consumers.
  • Services are for both mobile and non-mobile so no way to break that out.
  • There are differences in app purchasing in each store: In the US, language learning apps dominate the Windows app store. History eBooks are the top sellers in Samsung’s app store. In Apple’s app store, early childhood learning apps and astronomy apps are the top sellers. In Amazon’s store, all ten of the top selling apps are early childhood learning apps.
  • Examples of early childhood learning game companies funded in 2012 include MindSnacks, Fuhu, GetBonkers, MeeGenius, Fingerprint Digital, Duck Duck Moose, Mindshapes, etc.SCVNGR obtained $27 million, but they are moving away from higher education to consumers and mobile money productsAxonify is corporate-facing and integrates gamification into a training platform – they got $500K in funding
  • Sam Adkins-Ambient Insight

    1. 1. Ambient Insight 2013 The 2012-2017 Worldwide Game-based Learning and Simulation-based Markets Key Findings from Recent Ambient Insight Research Serious Play Conference 2013 August 19-22, 2013 Sam S. Adkins, Chief Research Officer Ambient Insight
    2. 2. Ambient Insight 2013 Agenda  Introductions - Research Taxonomy  Worldwide Game-based Learning and Simulation-based Learning Revenues  Worldwide Game-based Learning Revenues Buying Patterns, and Trends  All Roads Lead to Mobile
    3. 3. Ambient Insight 2013 Partial List of Ambient Insight’s Clients  Adobe  Amazon  Amplify  Apple  BlackBerry  Blackboard  British Council  Chungdahm Learning  Dell  Deutsche Telekom  Disney  Hasbro  Houghton Mifflin Harcourt  IBM  John Wiley & Sons  McGraw-Hill  Macmillan  Microsoft  Oxford University Press  Pearson  Qualcomm  Rosetta Stone Ambient Insight is an integrity-based market research firm that uses predictive analytics to identify revenue opportunities for suppliers.
    4. 4. Ambient Insight 2013 Ambient Insight’s Learning Technology Research Taxonomy Have Eight Buyer Segments From Six Types of Suppliers That Buy Eight Types of Digital Learning Products Packaged Content Consumer PreK-12 Corporations - Businesses Higher Education Federal Government State - Local Government Associations & Non-Profits Healthcare Custom Content Cloud-based Tools & Platforms Value Added Services (VAS) Installed Tools & Platforms Learning Devices Digital Video, Text, & Audio Reference Self-paced eLearning Courseware Collaboration- based Learning Simulation- based Learning Cognitive Learning Mobile Learning Social Learning Game-based Learning These six supplier types map directly to the six subcategories of learning technology products Seven International Regions North America Latin America Eastern Europe Western Europe Asia Africa The Middle East
    5. 5. Ambient Insight 2013 Game-based Learning is a Subset of the Learning Technology Industry  Ambient Insight defines Game-based Learning as one of the eight distinct types of learning technology products.  We do not approach Game-based Learning as a subset of the global videogame industry.  In the context of the worldwide learning technology market, isolating Game-based Learning products is relatively straightforward  There is only one hardware-based learning technology product type and that is Personal Learning Devices (PLDs) Ambient Insight’s 2013 Learning Technology Research Taxonomy
    6. 6. Ambient Insight 2013 2012-2017 Global Market Forecasts for Game-based Learning and Simulation-based Learning  Ambient Insight separates Game-based Learning revenues form Simulation-based Learning revenues  There are distinct pedagogical differences between Game-based Learning and Simulation-based Learning.  Our definitions of Simulation-based Learning and Game-based Learning are based on the research done by Alessi and Trollip. Global Revenues by Learning Product Type*** 2012 Revenues in $US Millions 2017 Revenues in $US Millions Five Year CAGR 2012-2017 Game-based Learning $1,548.44 $2,309.60 8.3% Simulation-based Learning $2,364.04 $6,648.89 23.0% Total $3,912.48 $8,958.49 18.0% *** Does not include hardware
    7. 7. Ambient Insight 2013 Pedagogical Definition of Game-based Learning  Game-based Learning is a knowledge transfer method that utilizes "gameplay," which includes some form of competition (against oneself or others) and a reward/penalty system that essentially functions as an assessment method.  Game-based Learning products (edugames) have explicit pedagogical goals.  A user "wins" an edugame when they achieve the learning objectives of the gameplay. There are distinct pedagogical differences between Game-based Learning and Simulation-based Learning. Ambient Insight’s 2013 Learning Technology Research Taxonomy
    8. 8. Ambient Insight 2013 There are distinct pedagogical differences between Game-based Learning and Simulation-based Learning.  There are four types of Simulation-based Learning:  Physical Object and Environmental  Process  Procedural  Situational  Allessi and Trollip compressed these four into two instructional strategies: learning about something (physical and process), and learning to do something (procedural and situational). Pedagogical Definition of Simulation-based Learning Ambient Insight’s 2013 Learning Technology Research Taxonomy
    9. 9. Ambient Insight 2013 Gamification Versus Game-based Learning  Game-based Learning versus Gamification (via SpongeLab):  Gamification is the application of videogame rules, mechanics and conventions to a non-gaming situation.  Put simply, if a student is playing a videogame and learning from it, we aren‟t witnessing gamification - the student is experiencing game-based learning. An educational game hasn‟t been “gamified” - because it‟s a game already!  Game elements are often “bolted on” to legacy training products  Badgeville sells gamification add-ons for corporate training  Course Hero has online courses with game mechanics from the Bunchball platform  Oxford University Press uses SecretBuilder’s game platform
    10. 10. Ambient Insight 2013 2012-2017 Worldwide Simulation-based Learning Revenue Forecasts
    11. 11. Ambient Insight 2013 2012-2017 Worldwide Simulation-based Learning Market The global growth rate of the Worldwide Simulation-based Learning market is 23.0%. Revenues reached $2.3 billion in 2012. Revenues will grow to $6.6 billion by 2017. *** Includes custom content services and tools revenue Simulation-based Learning by Region*** 2012 Revenues in $US Millions 2017 Revenues in $US Millions Five Year CAGR 2012-2017 North America $1,289.71 $2,729.99 16.2% Latin America $116.07 $685.23 42.6% Western Europe $451.40 $1,001.91 17.3% Eastern Europe $55.46 $144.69 21.1% Asia $374.02 $1,774.49 36.5% The Middle East $12.90 $47.77 29.9% Africa $64.49 $264.81 32.6% Total $2,364.04 $6,648.89 23.0%
    12. 12. Ambient Insight 2013 2012-2017 Worldwide Simulation-based Learning Five-year Growth Rates by Region 0% 10% 20% 30% 40% 50% North America Latin America Western Europe Eastern Europe Asia Middle East Africa 2012-2017 Growth Rates by Region
    13. 13. Ambient Insight 2013 2012-2017 Worldwide Game-based Learning Revenue Forecasts
    14. 14. Ambient Insight 2013 2012-2017 Worldwide Game-based Learning Market The Worldwide Game-based Learning market reached $1.5 billion in 2012. The global growth rate is 8.3% and revenues will reach $2.3 billion by 2017. *** Includes custom content development services revenue Game-based Learning by Region*** 2012 Revenues in $US Millions 2017 Revenues in $US Millions Five Year CAGR 2012-2017 North America $359.18 $582.00 10.1% Latin America $26.94 $71.59 21.6% Western Europe $96.98 $113.49 3.2% Eastern Europe $13.65 $29.10 16.3% Asia $1,029.43 $1,475.01 7.5% The Middle East $4.31 $9.89 18.1% Africa $17.96 $28.52 9.7% Total $1,548.44 $2,309.60 8.3%
    15. 15. Ambient Insight 2013 2012-2017 Worldwide Game-based Learning Five-year Growth Rates by Region 0% 5% 10% 15% 20% 25% North America Latin America Western Europe Eastern Europe Asia Middle East Africa 2012-2017 Growth Rates by Region
    16. 16. Ambient Insight 2013 Game-based Learning Catalysts • As of January 2013, Apple had app stores in 155 countries, up from 90 countries the year before • December 2012 – Microsoft opens app stores in 37 more countries – most of them in developing economies • Paid Android apps now available in Google Play stores in 134 countries as of March 2013 • Amazon App stores operational in 7 countries as of March 2013– expanding to over 200 in 2013 • May 2013 - Amazon is the first Western company to offer a platform for paid Android apps in China • The telecom advantage: direct billing via telecoms is the only viable payment method in many countries. – Samsung, Nokia, Microsoft, BlackBerry, and Google have direct billing agreements in Latin America, Africa, and Asia
    17. 17. Ambient Insight 2013 2012-2017 North America Edugame Forecast: Robust Custom Content Services Growth  Revenues for packaged mobile edugames reached $307.5 million in 2012. The growth rate (CAGR) is 8.4% and revenues will reach $459.9 million by 2017  The growth rate for custom edugame content development services is 18.8% and revenues will more than double to $122.0 million by 2017 North America Edugame Content and Services 2012 Revenues in $US Millions 2017 Revenues in $US Millions Five Year CAGR 2011-2016 Packaged Edugames $307.58 $459.95 8.4% Custom Content Development Services $51.60 $122.05 18.8% Total $359.18 $582.00 10.1%
    18. 18. Ambient Insight 2013 Worldwide Game-based Learning Market Trends Who is the Buyer?
    19. 19. Ambient Insight 2013 Buying Patterns: Game-based Learning Buying Behavior is Different in Each Country  The top buying countries for mobile edugames in 2012 were the US, Japan, South Korea, China, and India, respectively.  By 2017, the top buying countries will be China, the US, India, Indonesia, and Brazil.  Early childhood learning are the top selling mobile edugames in most countries in the world  Almost all of learning apps designed for young children include gameplay  App-based Brain trainers have recently become popular in the majority of countries across the planet  Leapfrogging the Digital Divide – All Roads Lead to Mobile
    20. 20. Ambient Insight 2013 Buying Patterns: 2012-2017 Worldwide Game-based Learning Market by Buyer Segment Consumers dominate the global Game-based Learning market Global Game-based Learning by Buying Segment 2012 Revenues in $US Millions 2017 Revenues in $US Millions Five Year CAGR 2012-2017 Consumer $1,145.85 $1,524.33 5.9% PreK-12 $170.33 $323.34 13.7% Higher Education $15.48 $46.19 24.4% Government $77.42 $138.58 12.3% Corporate $46.45 $92.38 14.7% Healthcare $61.94 $115.48 13.3% NGOs & Non-Profits $30.97 $69.29 17.5% Total $1,548.44 $2,309.60 8.3% Revenues concentrated in edugame content Revenues concentrated in custom services
    21. 21. Ambient Insight 2013 Buying Behavior is Different in Each Buyer Segment  Gaming consoles still banned in China  Consumers gravitate to edugames for young children and brain training games for adults.  Massive adoption of tablets in the schools across the planet is a major catalyst for Mobile Learning  In the US, Game-based Learning is ubiquitous in the early grades but starts to taper out in middle school  Pearson shutters Alleyoop in March 2013 after one year of operation  MineCraftEdu has sold over 700 licenses in the last year  Glass Lab will launch SimCityEdu in late 2013  Amplify to bring 35 edugames across the PreK-12 curriculum in late 2013
    22. 22. Ambient Insight 2013 Longitudinal Analysis: The Global Game-based Learning Market Enters Mature Phase 0% 5% 10% 15% 20% 25% Compound Annual Growth Rates by Seven Forecast Periods Data based on Ambient Insight’s Game-based Learning reports from 2006 to 2013.
    23. 23. Ambient Insight 2013 Buying Behavior is Different in Each Buyer Segment  The use of edugames in the corporate segment has always been problematic  “We are here to work, not play”  There are seven other learning technologies used in the corporate segment that essentially “compete” with Game-based Learning  There is a lingering perception that simulation and Game-based Learning are very expensive in comparison to eLearning courses  Classroom is still the dominant delivery method in the global corporate segment
    24. 24. Ambient Insight 2013 “The 2012 Content Trench” – Percent of Total Paid Mobile Learning Apps by Target Demographic 31% 9% 3% 6% 5% 8% 12% 26% 0% 5% 10% 15% 20% 25% 30% 35% 40% What’s on the Store Shelves? Consumer-facing Paid Mobile Learning Content Across All Major Application Stores, Platforms, and Devices The vast majority of PreK-2 Mobile Learning content is game-based
    25. 25. Ambient Insight 2013 Buying Behavior is Different in Each Buyer Segment  Federal agencies, particularly the military, are avid users of edugames  Government agencies are increasingly paying developers to create edugames ( web-based and mobile) for mHealth, literacy, and language learning initiatives  The US State Dept.’s Trace Word Soup game on the biNu platform launched in October 2012 and had over 1.4 million users in two months  Healthcare edugames are usually designed for patient education, disease prevention, and behavior modification  NGOs and Non-profits fund the development of mobile edugames relating to disease prevention, social engineering, and the environment
    26. 26. Ambient Insight 2013 All Roads Lead to Mobile “Mobile is an absolutely critical, if not „the' growth driver for the industry for the next several years.” Frank Gibeau, President of Electronic Arts Labels June 2013
    27. 27. Ambient Insight 2013 Booming Global Mobile Learning Market Explosion of Mobile Learning VAS Consumer Demand for Mobile Learning Large-scale Tablet Adoption in Academia Rapid Uptake of Location- based Learning New Mobile Learning Tools and Platforms New Personal Learning Devices Integration of Educational Content in mHealth The Convergent Catalysts in the Booming 2012 Worldwide Mobile Learning Market Telecoms’ new direct billing agreements with Nokia, Google, Microsoft, Samsung, and Blackberry are now major catalysts in developing economies
    28. 28. Ambient Insight 2013 Six Types of Mobile Edugames in Ambient Insight’s Research Taxonomy  Ambient Insight forecasts revenues for six types of Mobile Edugames:  Knowledge-based games  Skills-based games  Brain training and cognitive fitness games  Language learning games  Location-based learning edugames  Mobile augmented reality edugames  Mobile edugames have higher price points than non- educational games  Consumers and schools are willing to pay more for pedagogically-sound early childhood learning games Ambient Insight’s 2013 Learning Technology Research Taxonomy
    29. 29. Ambient Insight 2013 2012-2017 North America Edugame Forecast: All Roads Lead to Mobile  Revenues for mobile edugames reached $190.5 million in 2012. The growth rate (CAGR) is 15.3% and revenues will more than double to $388.2 million by 2017  In contrast, revenues for PC/Web/Console edugames are in relatively steep decline North America Edugame Delivery Platform* 2012 Revenues in $US Millions 2017 Revenues in $US Millions Five Year CAGR 2011-2016 Mobile Edugames $190.56 $388.02 15.3% Non-mobile Edugames $117.02 $71.93 -9.3% Total $307.58 $459.95 8.4% *Does not include custom content development services revenue
    30. 30. Ambient Insight 2013 What Sells? Track the Top Selling Mobile Edugames by Country  Free ranking sites track the top selling educational apps and games by country for:  Amazon Appstore, Apple App Store, BlackBerry World, Google Play Store, Nokia Ovi Store, Samsung Apps, Windows Phone Store, and Windows Store  There are often differences in app purchasing in different stores in the same country  App Annie:  http://www.appannie.com/top/iphone/united-states/education/  Distimo:  http://www.distimo.com/leaderboards
    31. 31. Ambient Insight 2013 Leading Indicators: Game-based Learning Private Investment Patterns  Game-based Learning companies garnered $149.4 million in private funding in 2012  Of the 33 Game-based Learning companies funded in 2012, 23 were mobile edugame companies  Breakout by Target Customer  23 were consumer facing, with 20 of them targeting early childhood learning  5 were PreK-12 – all of them targeting the early grades  3 were healthcare-facing edugame companies  And only one investment each made to higher education and corporate edugame companies
    32. 32. Ambient Insight 2013 0 5 10 15 20 Consumer PreK-12 Higher Education Healthcare Corporate Number of Companies Funded by Target Customer Type Leading Indicators: Game-based Learning Private Investment Patterns
    33. 33. Ambient Insight 2013 Q & A This deck is posted in Ambient Insight’s Free Resource Library at: http://www.ambientinsight.com/News/PublishedContent.aspx Sam@ambientinsight.com

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