the transformation

OF THE VIDEO GAME INDUSTRY

In the 1970s, individual gamers pecked at

keyboards or manipulated a dial to move black- 1972
The year Magnavox released
and-white dots across the screen. Thirty years the first home video game
later, games are an experience for groups of console, The Odyssey,
predating the Atari Pong
family and friends to send their cartoon avatars consoles by three years.
soaring through multi-dimensional virtual
cities. The gamer audience has expanded,
matured and diversified with the evolution of 1,000,000
video games. The number of units sold of
the video game console
A solitary pastime played on a box in the corner of a basement Telstar, the first produced by
recreation room or bar barely resembles collaborative educational, Coleco, a toy manufacturing
artistic and serious games simultaneously played on several company in 1976.
continents by millions of contestants. Devices for the young have
become devices that keep senior citizens young, bring families
together and train corporate professionals. In barely more than a
generation, video games have been transformed from a diversion
for the few into a mass medium, helping people live, learn, work
9
and of course, play. Number of computer and/or
video games sold on
average every second of
every day of 2007.
THE EVOLUTION OF GAMES
Game programming has developed beyond DOS-based games with
simple linear programming to advanced artistic, dramatic and
interactive game experiences. Pop-culture guitar and band games have players strumming
in bars, spurring an entertainment phenomenon to compete with karaoke. Today’s games
create new worlds where players can manipulate and change their environment through
realistic animation and unique motion-sensor controllers. Today’s games also do more than
create virtual worlds; they also illustrate the real world. Nonprofit organizations and issue
advocates use “serious games” as a medium to reach young tech-savvy consumers.

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The United Nations World Food Programme, for example, created a computer game to
educate children about world hunger. A commercial video game modified by University of
Southern California researchers helps recently deployed troops cope with symptoms of post-
traumatic stress disorder through play that simulates conditions in Iraq.

Corporations and educational institutions have also found video games to be useful tools.
Companies like American Express, Bank of America, IBM, JP Morgan Chase, Nokia and Pfizer
offer interactive computer training that includes game-like simulations. Educators harness
the power of video games to teach the next generation. The National Education Association
(NEA), a guiding force for instructors in schools, recommends city-building games to
improve students’ problem-solving and analytical skills.

TODAY’S GAMER $199.00

The individuals playing video games comprise an increasingly large The cost of the video game
and definition-defying group. According to the Entertainment console “Nintendo 64,”
Software Association, the average gamer is 35 years old and has released in 1996.
been playing for 13 years. Incidentally, there are more gamers than
non-gamers in the U.S. population (63 percent, according to the
NPD group), almost half of which are female. Today’s video game
players include students, employees, military troops, seniors,
20 million
mothers and fathers. As of late 2007, the number
of copies sold of all three of
The diverse segments of the gamer group — students, parents and Microsoft’s Halo games.
grandparents — have driven the evolution of games into new
territory. The first gamers have grown up, started families and
included their children and parents in the fun, multiplying the pool of multi-generational
gamers exponentially. Interactive social dance games are also making this pastime more
appealing to family members of all ages. Schools have also used active dance and sports
games like these in gym classes to the delight of many students. Retirement communities
are holding video game tournaments and receiving grants to purchase expensive consoles.

As the population of gamers has expanded, market forces have driven game developers to
make games more accessible to this new, diverse audience. Senior citizens are keeping their
minds sharp through games offering a series of 15 different activities like Sudoku, word
scrambles and number games. Suburban moms are running diners in casual games
featuring a stockbroker who quits her day job to run a diner. Casual games have simple
rules and plot lines to target a growing segment of occasional players.

INDUSTRY GROWTH
In the 1970s, a handful of companies, including Atari Inc. and Magnavox, produced a limited
amount of video games designed to appeal mainly to young males. In the following decades,
competitors such as Nintendo, Sony and Namco joined the industry and companies began
making games that appealed to a wider audience. Today, the growth of gamers and
increased demand for games has translated into the explosive growth of the entertainment
software industry. Video games are now an $18 billion industry in the U.S. and the
Entertainment Software Association has more than 20 member companies, including
Microsoft, Nintendo, Sony and Electronic Arts.

The entertainment software industry is one of the best performing sectors of the American
economy. Computer and video game companies posted record revenues of $9.5 billion in
2007 and the industry grew by 17 percent from 2003-2006, four times the growth rate of
the national economy.

The industry also adds lucrative jobs to local economies with average salaries nearing
$100,000. Computer and video game companies directly and indirectly employ more than
80,000 people in 31 states.
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