Following up on yesterday’s post that maybe the casual games biz isn’t growing quite so explosively as some think, I decided to look closer at the one metric that is readily available for gauging performance.

Most portals are either private, or small parts of bigger entities that don’t break out results separately for games. But, since all these portals live or die based on web traffic, we can use publicly available web traffic figures as a proxy for how well the sites are doing.

The best site for researching web traffic patterns is www.alexa.com. However, it only works for sites with their own domain (i.e. www.pogo.com). For casual game portals that are subdomains of larger sites (i.e. http://games.yahoo.com/), Alexa will only give you results for the main domain (www.yahoo.com), so the games results are dwarfed within the larger site’s results, and not useful for us. Also, Alexa measures reach per million web users. If internet use as a whole grows 20%, and a given site matches that growth, then it will appear flat (I think). So, given that internet usage is obviously growing, one must assume that a flat line in Alexa does not imply no absolute growth.

OK, so here’s a bunch of graphs looking at the performance of all the main sites that have their own unique domains. First, a quick calibration – google.com. I know they’re not a games site, but I wanted to show the graph of a very big, fast growing site, for reference:

Nice growth – looks like about 30% per year, with even faster growth in 2005 than in 2004.

OK, now on to the casual game sites. Note that the scale on the left side is different for each of these graphs. I’ve tried to group pairs of sites that are roughly similar in size. Alexa won’t let me graph more than two at a time.

Some notes:
RealArcade uses a custom browser for many (most? all?) of their customers, and I’m not sure if Alexa measures that browser well, so the overall size of RealArcade’s traffic may be underestimated.

PopCap is a hybrid developer/publisher, with a portal-like site. But more so than the others, their traffic is driven by one or two big hits that they develop. Zuma and Bejeweled 2 both came out in 2004, causing the spike then, and they haven’t had as many games this year, partly explaining the decline.

Gamehouse is also a hybrid developer/publisher, but with less hit-driven results, thus their numbers are more steady. It’s also possible that, as casual gamers become more sophisticated, they may be shifting from publisher sites, like PopCap and Gamehouse, with a 20-40 titles on offer, to full-blown portals with 150+ titles on offer, and more frequent new titles.

Conclusions:
Unfortunately, there is little here to indicate explosive growth for this industry. Several sites saw nice growth in the second half of 2004, but from the beginning of 2005 to the present, most are flat to down.

It’s possible that this reflects a bit of a shift from users playing browser versions of the game, in which case they would revisit the sites every time they play them rather than just when they’re initially downloaded. I don’t know – I don’t have data on browser-play versus download play.

Also, it’s possible that other sites (i.e. smaller sites) are growing faster, at the expense of these sites. Again, I have no data to confirm or refute that. BigFish was supposed to be an ‘up and coming’ smaller site, and clearly they grew a tremendous amount in 2004, but, according to Alexa’s numbers anyways, that growth has stalled in 2005.

Anyways, don’t read too much into these graphs. I can’t confirm how closely Alexa traffic numbers match up to site revenues. If you know of any better (public) data sources, please let me know.

Update:
I was sent a link to this article about BigFish, which quotes non-public Media Metrix data stating that BigFish was the second fastest growing internet site in the United States in October 2005. The fact that Angel investors just put $5 million into the company would also indicate that their financials look good.

That same article also has the quote from an IDC analyst that the industry will double in size in the next two years. That one I have more doubts about – I’d like to see more evidence that the biggest portals are actually growing before I’d buy into that. Even if BigFish is growing, they are still probably #5 or #6, and likely taking share away from the other portals.

This entry was posted on Wednesday, December 21st, 2005 at 10:17 am and is filed under Game Biz. You can follow any responses to this entry through the RSS 2.0 feed. Both comments and pings are currently closed.