Companies in this industry manufacture electronic toys and games, including video game consoles. Major companies include console makers Microsoft (based in the US), Nintendo (Japan), and Sony (Japan), as well as peripheral providers such as Bigben (France), Nyko (US), and Logitech (Switzerland).
Demand is driven by personal income and product innovation. The profitability of individual companies depends on effective marketing, competitive product design, and manufacturing efficiency. Market success drives additional revenue via royalties paid by third-party game developers. The US video game console industry is highly concentrated: the top three companies dominate.
Products, Operations & Technology
Major products are video game consoles, portable players, and peripheral hardware. Video game consoles are computers specially designed to deliver entertainment and game software. Home video game consoles are designed to be used with TVs, while portable devices utilize built-in displays. The home video game console market is dominated by three product lines: Sony's PlayStation, Microsoft's Xbox, and Nintendo's Wii. Similarly, handheld products made by Nintendo (2DS, 3DS) and Sony (Vita) account for most of the portable gaming console market. Nintendo also offers a hybrid console called Switch that has both home console and mobile gaming capabilities. Peripheral hardware includes devices that elevate the human-machine interaction (HMI) such as controllers, joysticks, and driving wheels. Peripherals also include upgrades to core products, such as larger hard drives, additional memory, and wireless connectivity devices.