Planet Money
10:19 am
Tue December 10, 2013

Do Americans Spend More On Video Games Or Movies?

Originally published on Tue December 10, 2013 11:34 am

Americans spend more on video games than on tickets to the movies. Grand Theft Auto V was the fastest-selling entertainment product of all time, with sales of $1 billion in just three days.

But when you factor in everything — not just movie tickets, but on demand, rentals, etc. — Americans still spend way more on movies than they do on video games.

"In the film industry, the box office is only the first release," NYU economist Bill Greene told me. "The revenue stream goes on and on and on."

This is very different from the way the video game industry works.

"You buy the game and can use it in that medium forever. There's one point of sale and that's it," said professor Robert Bloomfield, who studies video game and virtual world economies at Cornell.

But that model is changing, Bloomfield says. Candy Crush Saga, the wildly popular mobile game, is free — but players can pay for tools that help them finish levels or advance to the next level. Players spend hundreds of millions of dollars a year on those tools.

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