Once considered a passing fad, Sony PlayStation CEO Jack Tretton says gaming is now mainstream entertainment with more than a billion gamers worldwide.
In an interview with Bloomberg Television's "Bloomberg West," Tretton says that gamers who are content with mini games on a smart phone or tablet will stick with the platform, but "as people get hooked, they find themselves migrating up the food chain to a dedicated device like the Vita."
Tretton is referring to the recently released PlayStation Vita, a follow-up to the PlayStation Portable (PSP). The device is built to satisfy the needs of all gamers, from the hardcore gamer demographic to the simple mobile-app lover. The Vita incorporates non-game applications, including web browsers and social networking, such as free downloadable Netflix, Twitter, and Flickr apps. Some users have reported that the console, which is also outfitted with duel cameras, feels more like a smartphone than a gaming console.
This user acquisition technique seems to differ from other gaming companies that narrow in on their demographics. By targeting a range of gamers, and working to transition them from one platform to another, Sony hopes to continually appeal to both men and women, young and old.
Faltering gamer market
The success of the Vita would be a nice jump-start to the gaming industry, which saw sales of hardware, software, and accessories drop 34% in January to $750.6 million.
"Sales a year ago were $1.14 billion, when the industry benefited from titles such as "Dead Space 2" and "Little Big Planet 2," reported the NPD Group in an email to Bloomberg.
It is suspected that a drought of hyped-up game and console releases has kept gamers from going to stores. This also keeps consumers from making additional and unplanned purchases of games and accessories picked up while skimming the aisles.
Business section: Investing ideas
To help you analyze the key players in the industry, here is a list of the popular gaming companies trading on U.S. stock exchanges.
Will the newly released Vita breathe some life (and revenue) back into the gaming market this year? (Click here to access free, interactive tools to analyze these ideas.)
1. Activision Blizzard (Nasdaq: ATVI): Publishes online, personal computer (PC), console, handheld, and mobile games of interactive entertainment worldwide. Market cap of $13.87B
2. Changyou.com Limited: Develops and operates online games in the People's Republic of China. Market cap of $1.38B
3. Electronic Arts (NYSE: EA): Develops, markets, publishes, and distributes game software and content for video game consoles, personal computers, mobile phones, tablets and electronic readers, hand held game players, and the Internet. Market cap of $5.61B
4. Shanda Games Limited (Nasdaq: GAME): Engages in the development and operation of online games in the People's Republic of China. Market cap of $1.23B
5. International Game Technology: Designs, manufactures, and markets electronic gaming equipment and systems worldwide. Market cap of $4.54B
6. Konami: Develops, publishes, markets, and distributes video game software products for stationary and portable consoles, as well as for use on personal computers. Market cap of $3.96B
7. Microsoft (Nasdaq: MSFT): Develops, licenses, and supports a range of software products and services for various computing devices worldwide. Market cap of $264.14B
8. Take-Two Interactive Software (Nasdaq: TTWO): Develops, and distributes interactive entertainment software, hardware, and accessories worldwide. Market cap of $1.39B
9. Zynga: Develops, markets, and operates online social games on the Internet, social networking sites, and mobile platforms. Market cap of $9.04B.
Interactive Chart: Press Play to compare changes in analyst ratings over the last two years for the stocks mentioned above. Analyst ratings sourced from Zacks Investment Research.
Kapitall's Rebecca Lipman does not own any of the shares mentioned above. Data sourced from Finviz.
