Tuesday, May 3, 2011

Gaming Market Revenue Models Now Must Change

There is no denying the value the Internet represents for users. There also is no denying the disruption the Internet brings to virtually every business it touches. It now appears the console gaming business is about to be disrupted.

"We as VC’s love when a market is undergrowing great change and that industry is shifting from packaged console-based gaming and going to a free-to-play model," says venture capitalist William Quigley, managing director of Clearstone Venture Partners.

"We also need new monetization models," he says, an obvious understatement when a category moves from selling products to enabling "free" usage. Payment and virtual goods seem good candidates for necessary innovation as the transition occurs.

Also, a lot of the dollars currently spent on traditional advertising are migrating to gaming, he notes.

In addition to cloud services and mobile applications, Quigley sees a decade-long wave of innovation ahead for gaming.

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