SG market & Pricing in Health and Fitness


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Presentation, discussion given at the GALA SIG 3.3 meeting in Paris the 28th November 2011. (business aspects of Health and fitness games)

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SG market & Pricing in Health and Fitness

  1. 1. SG market & Pricing in Health and Fitness AtoS (Wp4), ORT Thierry Nabeth, AtoS Alumnus Giusy Fiucci, ORT
  2. 2. Table of content <ul><li>SG market & Pricing </li></ul><ul><ul><li>A very fragmented market </li></ul></ul><ul><ul><li>Very little data available </li></ul></ul><ul><ul><li>Some facts </li></ul></ul><ul><li>SG market & Pricing in Health and Fitness </li></ul><ul><ul><li>The 3 components </li></ul></ul><ul><ul><li>Some facts </li></ul></ul><ul><li>Conclusion </li></ul>
  3. 3. SG market & Pricing Findings from WP4 <ul><li>Little data available </li></ul><ul><li>Comparing oranges (games) and apples (serious games)? </li></ul><ul><li>Yet some data </li></ul>
  4. 4. WP4: Looking at the Business Dimension of SGs <ul><li>The role of WP4 - Industry and Stakeholder Engagement is about: </li></ul>Looking at the Business dimension of Serious Games First stage of the work: Looking about the information available. (reports from analysts, websites, etc.)
  5. 5. Findings: Little information available <ul><li>Few reports from the Analysts (and more notably: the IDate reports) </li></ul><ul><li>J. Alvarez, L. Michaud (2008) Serious Games : Advergaming, edugaming, training and more, IDATE Study 2008 (free) </li></ul><ul><li>Julian Alvarez, Véronique Alvarez, Damien Djaouti, Laurent Michaud (2010); Serious Games: Training & Teaching - Healthcare - Defence & security - Information & Communication, IDATE Report 2010 (> 3000 Euros) </li></ul><ul><li>Some information (very little) from general analyst such as Forrester research. (who seem mostly focussed on the game market) </li></ul><ul><li>The web sites: </li></ul><ul><li>The serious game market web site of Elian Alhadeff. But it remains largely qualitative even if some numbers and facts are sometime provided (Reconciling Serious Games Market Size Different Estimates (blog post), Serious games market blog 8 April 2008). Such as the estimation of a market size in 2008 of 1.5-2 Billion dollars. </li></ul>
  6. 6. Example of facts Market value forecast $ 1.5 - 2 billion dollar estimate for 2008 Although the information was posted in a blog, it originates from a person (Elian Alhadeff) that is following for many years the market of serious game, and can be considered as an expert. Elian Alhadeff.: Reconciling Serious Games Market Size Different Estimates (blog post), Serious games market blog 8 April 2008 Alhadeff 2008
  7. 7. Example of facts adoption Forrester's research finds that 10% of North American online adults have played at least one of three types of serious games, and the reviews are generally positive. Forrester research. Generalist analyst of technologies. TJ Keitt 2009: Demand Insights: Serious Games Break Through 11 March 2009 Forrester research TJ Keitt 2009
  8. 8. Example of facts Cost <ul><li>Costs/pricing (“What’s the going price of a serious game?”) </li></ul><ul><li>Work for hire... </li></ul><ul><li>$50k - $250k normal range </li></ul><ul><li>$500k - $1m possible </li></ul><ul><li>OTS product/solutions approach... </li></ul><ul><li>$10 - $100 per seat </li></ul><ul><li>$10k - $100k site licenses </li></ul><ul><li>annual licenses </li></ul>Presentation (slides) from the CEO of PixelLearning (serious game design company) Kevin Corti (2009):  Corporate Learning Games , Siege Conference 2009, 3 October 2009 . Presentation (slides) K. Corti 2009
  9. 9. Example of facts Market value Advertising-linked communication titles are playing an increasingly significant role in the ingame advertising market, an industry estimated to be worth 205 million USD in the USA (2008) Market value Source: Nintendo (?) The brain fitness market is currently thriving; in 2007, it generated 227 million USD in the USA alone In the USA alone, advergaming is said to be worth 262 million USD in 2008. Market value Source: IDC At the end of 2007 the serious gaming market was estimated to be worth between 1.5 and 10+ billion USD. This report, that is now freely available (a new report from IDate is available since 2010) appears to be the more valuable information about the serious game market and business so far. J. Alvarez, L. Michaud (2008)  Serious Games : Advergaming , edugaming , training and more , IDATE Study 2008 Alvarez & Michaud (2008) 
  10. 10. Tendency of Comparing Oranges and Apples <ul><li>The Myth : Serious game market is of same nature as the game market, and therefore that the players of each market can easily enter in the other one? </li></ul>Game market Serious game market The reality: are we not comparing Oranges and apples?
  11. 11. Yet there exists fundamental differences Customer : the corporation Customer : the family (mass market) Investments : moderate (services) Investments : huge (products, Distribution channels) Hardware : the laptop Hardware : the console Objective : performance (serious!) Objective : entertainment Serious game Game
  12. 12. The risks: many illusions <ul><li>Several illusions </li></ul><ul><li>Money illusion: The market value of the serious games market is the same the one of the game market. </li></ul><ul><li>The size illusion: The customer of one market will become the natural customer of the other market </li></ul><ul><li>Competency illusion: the game actors will easily be able to design games for the other market. </li></ul><ul><li>The reality: (personal finding) </li></ul><ul><li>The potential of generalization from a market to the other is probably largely exaggerated. </li></ul>
  13. 13. Conclusion <ul><li>Very little factual information available. </li></ul><ul><li>A tendency to mix markets (in particular the game market) leading to some illusions </li></ul><ul><li>A very fragmented and diverse market. It is probably more than a matter of segmentation but of having different market s . </li></ul>
  14. 14. SG market & Pricing Health and Fitness <ul><li>A detailled report available by Physic Ventures: Health e-Games Market Report: Status and Opportunities (2008) </li></ul><ul><li>A domain that appears very diverse. (casual games; serious games; exergames) </li></ul>
  15. 15. SG market: Little information available <ul><li>The report: </li></ul><ul><li>Andy Donner, Douglas Goldstein and Julia Loughran (2008) Health e-Games Market Report: Status and Opportunities; Physic Ventures </li></ul><ul><li> </li></ul>
  16. 16. SG market: Different markets <ul><li>The main “markets”: (totally different markets) </li></ul><ul><li>The Casual games (fun and easy to learn video games. Such as brain training) </li></ul><ul><li>The Serious games (benefits beyond entertainment, such as training, education and performance improvement across industries) </li></ul><ul><li>The Exergames (digital interactive physical motion and fitness games). Nintendo Wii . </li></ul>
  17. 17. SG market: Business models <ul><li>Large variety of Business Models: </li></ul><ul><li>Consumer Direct: Nintendo’s Wii, Wii Fit, Brain Age; </li></ul><ul><li>Enterprise: Expresso Fitness’ S2U and S2R; Konami’s DDR, … </li></ul><ul><li>Advertising: Fit Brains </li></ul><ul><li>Subscription: Lumos Lab’s Lumosity, Happy Neuron </li></ul><ul><li>Sponsorship: Kraft Game Pad, HopeLab’s Re-Mission </li></ul><ul><li>Nonprofit/Government Grants: Archimage’s Escape from Diab (NIH); </li></ul>
  18. 18. SG market: Different platforms <ul><li>Result of the Technology Platforms of 300 eHealth games (2008) </li></ul>
  19. 19. Conclusion
  20. 20. Conclusion <ul><li>… discussion </li></ul>
  21. 21. THANK YOU!
  22. 22. The illusion of a same market Game market Serious game market Fun Laptops Big money Customers Smaller money Performance Consoles Corporation Serious games market appears to be a market with its specificities, even if some overlaps exist