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Video Games and Software

Royalty Profile for Licensed Video Games/Software

 

Sector value, U.S. & Canada, 2017: $3.12 billion

Proportion of retail sales of licensed merchandise, U.S. & Canada, 2017: 2.9%

Average royalty, U.S. & Canada, 2018: 10.48%

Royalty range, U.S. & Canada, 2018: 1–20%

Average royalty, U.S. & Canada, (10 years) 2009–2018: 10.50%

Analysis

Royalties for corporate licensing in this area run in the low single digits. For software in which, for example, multiple car brands or athletes or music properties may be featured, each licensor would get a fractional percentage of the total. (Often car brands’ presence is promotional and they receive no royalty.)

Among dedicated game/software titles, film- and sports-based properties draw higher than average rates, as do entertainment properties, although their royalty percentages are falling as their sales potential has increased.

Royalty rates for mobile games follow the same trends, although they tend to be higher because of lower development costs overall.


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