PC online gaming may appear to be a huge success, but analysts at research firm Datamonitor warned today it's a market that's failing to make money.

The report, Global Games Online: 1st Edition, says the PC games competition market is only attracting diehard players and that internet-connected consoles hold the promise of bringing online gaming to the mass market.

"The online gaming market has experienced several false starts in its short history but the launch of the PlayStation2 and Xbox online should mark the beginning of a true period of growth," said Frederic Diot, the report's author.

But Datamonitor is certain the progress to console-based online gaming will take time, leaving PC games makers to find ways of attracting new users and generating profits.

Online gaming site BarrysWorld, owned by high street retailer Game, this week introduced a subscription fee to its site. The fee, it says, means it can afford to run a greater variety of services.

Visitors to BarrysWorld will now have to pay £24 per year if they want unlimited game playing. Game reward cardholders get this at half price.

"The revenue will allow the platform to support new games and services," said a company spokesman.

Datamonitor predicts the market for online games will reach $2.9bn by 2005.