PC-Gaming Hardware Worth $20 Billion

If PC gaming is dying, as many have claimed, why are gaming-oriented PCs selling so well? Market analyst Jon Peddie estimates that the market for PC gaming hardware stands at $20 billion today—and predicts it will expand to $34 billion by 2012.

Peddie, principal of the market-research and consulting firm Jon Peddie Research, estimates that hardware sales pull in an additional $6 billion in sales of software and related services annually. “Retail software figures are not an accurate barometer for the health of the PC gaming industry,” said report co-author Ted Pollak. “The retail numbers don’t capture the casual and digitally distributed games, either.”

PC Gamers, on the other hand, don’t buy all that many games, according to Pollak. “Enthusiast PC gamers often latch onto one or two games that offer multiplayer options and stick to these titles for years,” he said. “Hardware is where they spend the big bucks.”

It will come as no surprise to this audience that in addition to the market for fully assembled PCs, Peddie “discovered a robust market of do-it-yourselfers and consumers who upgrade their PCs with high-performance gaming graphics boards.” Obviously Tom’s Hardware knew about this "discovered market" years ago.

Peddie forecasts the highest worldwide compound annual growth rate—21 percent—for “mainstream” gaming PCs, but he expects the “performance” segment to grow at only a slight slower pace (19 percent) and the “enthusiast” segment, where prices are highest, to grow at a healthy nine percent.

The report also predicts that the ongoing economic recession could stymie the growth of the console gaming market because consumers might be reluctant to invest in the HDTVs needed to deliver the best gaming experience with those systems. Personal computers, Peddie surmises, are useful for a much broader range of applications than televisions and gaming consoles.

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  • cmmcnamara
    This article is very true. I myself spend most of my computer related money on hardware upgrades. Hardware-wise I spent over $1000 on my old AGP system, upgrading processors, swapping dead motherboards, bigger hard drives, and went through 4 graphics cards (MX 3200, FX 5200, 9650 Pro, 7600 GS) before finally jumping the gun early this year to my Core 2 Duo platform (yay for a well paying job) and I will probably build a Core i7 system within the next couple months and I am definitely building a "fragbox" AMD based system.

    After all that hardware, I have spent very little on software in comparison. I bought XP Pro 32 and 64 bit in an OEM pack for 80 bucks which lasted me years until I built my new system which had the motherboard and CPU bundled with Vista. And for games its true about the latching on. Since I was in middle school I've been playing Counter-Strike and Day of Defeat and the new Source games. Every once and a while I'll buy another game like Battlefield 2 or Call of Duty 4 but I mostly center around Valve's games and play them for years.
  • smalltime0
    I think one of the things ablut a PC which is so attractive is that you can keep it into another generation of gaming... If a few years ago you shelled out for a fast single core, a few GB of RAM and a half decent graphics card (on the PCI bus) you could potentially still be playing games on it (albiet with low graphics), at the time you would have been in the original Xbox generation.

    There is also the ease in buying new parts after warranty expires, upgrading HDD capacity (more of a concern with PS3 and an optional concern with the new Xbox 360 thing).
  • the associate
    I concur with cmmcnamara. I to spend most of my cash on hardware upgrades. The part in the article about people sticking to multiplayer games for years is correct in my opinion for the most part. I still have a load of friends who play BF2 (only because EA didn't release Bad Company for the pc) and cs source. I still play these games to, however, I buy at least 4 pc games per year, this year I bought the Witcher, X3 Reunion 2.0, Supreme Commander and FarCry 2 for the pc, and intend to buy GTA4 and Fallout 3 for the pc as well, at the very least anyways ;).

    As long as the games are good, pc gamers will buy them. But since we spend so much money on our machines, and since, quote "Peddie “discovered a robust market of do-it-yourselfers and consumers who upgrade their PCs with high-performance gaming graphics boards.”" we are therefore theoretically more tech savy than most casual to enthusiast console gamers, and we check our games before we drop the cash on em. So you won't see nearly as many of a stupid game sell on a pc as they do on consoles, the Nintendo Wii is a perfect example of crap games that sell big, i'm not insulting the Wii in any way here btw. And besides, one of the ironic reasons the pc gaming market is going down is strickly because idiot gaming companies like EA are stoping to release games for the pc and putting ridiculous constraints for instalations on them, their lattest drm being 3 activations, with a new activation required for every reformat and hardware upgrade, which is dumb, I upgrade hardware and reformat together what, at least 5 times per year :S? (correct me politely if i'm wrong). So no shit sherlock we will have less sales to our name, we get less games, inhuman restrictions and many of them are delayed as well. If I had a ps3 theres no doubt in my mind I would have goten gta4 when it came out, and not bother waiting 8ish months to get it for the pc.
    Ive owned consoles since the super nintendo, and i've never bought as many games as I do for the pc, but if a game like age of empires 3 came out for the Wii and didnt suck, id be all over it :D