NEWS - Thursday, June 19, 2003

Online Gaming Market Slower in Europe

Microsoft, Sony Face Slow European Net Gaming Market LONDON (Reuters) - Microsoft Corp. on Wednesday said it had signed up 50,000 European customers to its Xbox Live Internet service in the first three months, a sign online gaming is slower out of the gates in Europe. Online gaming is seen as an important emerging market for video game publishers and console makers looking to charge players subscriptions for multi-player action. Microsoft and Sony Corp have led the charge, signing up over one million subscribers between them in the U.S. since launching services in the second half of 2002. On Wednesday, Microsoft provided a more modest account of the European market. Since launching in mid-March, the software giant has signed up to Xbox Live 50,000 European gamers across much of Western Europe and over 500,000 American gamers. The company plans to launch Xbox Live in eight more countries worldwide by year-end including European markets Austria, Denmark and Ireland, Peter Moore, Microsoft’s corporate vice president of retail sales and marketing, told attendees of a London video games conference on Wednesday. A spokesman for Sony Computer Entertainment Europe (SCEE) said the company had signed up 3,000 UK gamers since launching its multi-player offering on June 11. The service will launch in Germany, France and Spain later this month, he said. Both Microsoft and Sony sell online adapter kits. Sony’s carries a suggested retail price of 40 pounds ($67.04) while Microsoft charges 39 pounds and 59 euros ($69.21) in Continental Europe. Analysts expect console makers and publishers to generate consistent revenues from online gaming in two to three years, but warn that the costs of building out a network capable of supporting thousands of online gamers will be a cost drain in the near term. Undaunted, Microsoft intends to have 100 Xbox Live game titles by the second quarter of next year, up from the 20 currently available in Europe. Japan’s Nintendo, maker of the GameCube console, which is battling neck and neck with Microsoft for the number two position in Europe, has said it will stay out of the online gaming sector until broadband usage builds to mass market levels.


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