Are Games Bigger Than Movies?

Here’s a good account of the games vs. movies debate:

“We can also look from the standpoint of gross mischaracterization of fact. Most of the articles are qualified by the ‘box office’ limitation. Games sales are bigger than box office receipts. As my law professors used to say, ‘true but trivial.’ How many of those articles explain box office receipts are 8%, or less, of total revenue arising from an investment in a film property. The box office, at best, is nothing more than an indicator of the downstream revenue. A film makes money in the theater, then it makes more money in the pay per view window, then on DVDs, then on cable and on down the line. This is why movie studios refer to the launch of a film as the launch of an ‘equity.’ The same can be said of the music industry

I’ve made the statement at times that games are bigger than movies, all the while fully aware that it wasn’t a totally fair comparison given the fact that a game is a $50 ticket vs. $8 for a movie ticket. I’m not sure that this alone makes the market for movies that much bigger because movies are constrained by several factors, the biggest of which is that a feature film has a relatively short shelf life in big money distribution (theatres, international, DVD) while games can go on for several years.

Even taking into account the fact that the trendline is far more telling than the snapshot of the market size at any one point, I’ll refrain from making this comparison in the future.


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