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As the online service offerings of gaming consoles become more popular with gamers, analysts predict these offerings will expand to include movie and music downloads as well as just games.

According to a new study from ABI Research, as more and more gamers get into the multiplayer and community features enabled by their next-gen consoles’ online service, a growing percentage of their gaming budgets will go towards buying full game titles and eventually even movies and music.

“All of the big-three console vendors are working closely with their publisher partners, both internal and third party, to push as much content through digital distribution as possible,” said research director Michael Wolf.

ABI Research believes that Microsoft currently has the leading online gaming service, in Xbox Live, stating the company’s focus on casual game distribution through its Live Arcade and new features such as Video Marketplace have kept its momentum despite new offerings from its competitors. Nintendo, however, could challenge in the online casual game space with its strong library of legacy titles in its Virtual Console while Sony’s PlayStation Network will likely see higher attach rates as both Sony and its studio partners expand the online offerings, ABI says.

“By establishing their consoles as connected devices with tens of millions in installed base and established online commerce services, these vendors will also look to move beyond gaming content to sell digital entertainment such as movies and music,” said Wolf. “We believe that video and music downloads to game consoles will reach $1.1 billion annually by 2011.”

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