It should be noted that console games differ from PC games both with respect to higher CPU usage and bandwidth consumption.

So far, telcos and ISPs have not made their mark in the world of online console gaming, and it is about time we ask ourselves what business opportunities exist and what roles we can take on in this accelerating and exiting market.

The Japanese market research company Global Information Inc. estimates that the global online games market will represent  3.2 billion US dollars and a 113 million users in 2005. Although they expect PC online gaming to continue growing strongly, “the main driver of the market will come from console online gaming, which will bring masses of new users to online gaming and will rely on lucrative business models.” 

A different service development approach

Online console gaming is an excellent example of how one can bridge the gap between a purely technology-driven development, and more user-focused service evolution. The strategy is different from the traditional development of completely new services often based on technology, rather than user acceptance and usability. The two different strategies are shown in the figure. 

Figure: Alternative strategies in broadband service development

Telecom vendors seem to have adopted a ’wait-and-see‘ strategy towards online console gaming. Partly so, because of the more general recession within the industry, but maybe just as much because the developmental model of these new services has ’by-passed‘ the telecoms industry and reduced it to a mere carrier.

Business opportunities and roles

The telecoms industry has previously had a central role in many online services. However, it has hitherto failed to make its mark in the world of online console gaming. Whether or not this is part of an explicit strategy, the fact remains that by adopting such a position the short-term result will be that telcos will loose out on substantial, potential revenues. On the longer term the result might be that telcos find themselves more than one lap behind in the race for developing profitable, online services for a larger general public.

There are several roles for telcos to play in the market of online console gaming. Which one to opt for depends on both the willingness to invest, the adopted profile of risk-taking, and how online console gaming relates to each company’s product portfolio or strategic ambition. Examples of roles can be:

• Telcos acting as ’conveyor belts’, i.e. as mere carriers.

• Telcos defining online console gaming as an important marked segment.

• Telc’s acting as GSP (Gaming Service Provider).

Network impact from online console gaming

From our initial experiments with Online Console Gaming, some basic facts can be stated.

Most of these applications are based on a central server to provide for registration, finding and the set-up of Online Console Games. You will often find functions like chat and other ‘buddy‘ services included. The actual gaming traffic, however, is peer-to-peer, directly between players.

Game consoles consume high bandwidth. Even if the players distribute only updates, a significant amount of data needs to be distributed between the players. Our initial study concludes that the following parameters are important in online console gaming:

• Delay, usually referred to as ping times or ’lag‘.

• Bandwith capacity.

Both of these parameters are crucial, and are influenced by network architecture, possibility for local routing and symmetry in the xDSL-products.

Conclusion

We believe that more research is needed in this field in order to address important questions like:

• How can online console gaming represent new business and revenue opportunities for traditional network operators both at pan-European and national level?

• What roles can and should telcos/ISPs take in this new market?

• How will online console gaming affect both edge and core networks and their design?

• Can online gaming consoles represent an alternative way to provide TV-users with other popular Internet based services like messaging and VoIP? 

These are major questions, which should be explored in further studies.  What makes this field so interesting is that online console gaming represents just the first of many new bandwidth-consuming, peer-to-peer-based applications and interactive services entering our networks.