Market Environment

Newzoo1 – a renowned global provider of games and e-sports analytics – estimates the volume of the global videogame market at 148.8 billion USD at the end of 2019, which corresponds to a 7.2% increase over the 2018 year-end value (138.8 billion USD). In 2019 the strongest growth was observed in the mobile and console segments. The former grew by 9.7%, reaching 68.2 billion USD, while the latter grew by 7.3%, reaching 45.3 billion USD. The PC market reached a volume of 35.3 billion USD, having increased by 2.8%.

Figure 1  2019 estimated global videogame market volume per device (%)


Source: Newzoo

According to Newzoo analysts, the largest share of the global videogame market is currently held by mobile devices (46%), 80% of which are smartphone releases. Gaming consoles come in second at 30%, followed by the PC 24%. Mobile devices are projected to retain their top position, with their corresponding market volume increasing by 11.2% annually (on average) over the next three years. According to estimates, the volume of the global mobile game market will reach 93.6 billion USD by 2022 (it currently stands at 68.2 billion USD).

Estimates published by ESA (Entertainment Software Association)2 concerning the US market, which is the most important region from the point of view of the Group’s activities, confirm the domination of smartphones in this area, although their advantage over PCs and consoles is not as high as e.g. in Asia. 60% of American gamers include smartphones among their most frequently used gaming devices, with PCs and consoles coming in at 52% and 49% respectively.

Long-term projections remain optimistic. Newzoo claims that the global market will reach 189.6 billion USD by 2022, whereas the PWC “Global Entertainment & Media Outlook 2019-2023”3 report projects a 6.5% cumulative annual growth rate (CAGR) of the videogame and e-sports market between 2018 and 2023.

Figure 2  Estimated share of individual regions in the 2019 global videogame market (%)


Source: Newzoo

In terms of territorial distribution, Asia and Pacific countries account for 71.5 billion USD (6.6% y/y increase), which represents nearly 50% of the 2019 global market volume. North America comes in second place, at 38.4 billion USD (8.3% y/y increase), closely followed by Europe, the Middle East and Africa (7.1% growth, reaching 33,3 billion USD). Notably, two countries – China and the United States – jointly hold a 48% share in the global market (36.5 billion USD and 35.5 billion USD respectively)4.

 

1 Newzoo Adjusts Global Games Forecast to $148.8 Billion; Slower Growth in Console Spending Starts Sooner than Expected, Newzoo, 19 November 2019, accessed on 30 January 2020, www.newzoo.com/insights/articles/newzoo-adjusts-global-games-forecast-to-148-8-billion-slower-growth-in-console-spending-starts-sooner-than-expected
2 Essential fact about the computer and video game industry, Entertainment Software Association, May 2019, accessed on 30 January 2020 www.theesa.com/wp-content/uploads/2019/05/2019-Essential-Facts-About-the-Computer-and-Video-Game-Industry.pdf
3 Perspectives from the Global Entertainment & Media Outlook 2019–2023, PWC, accessed on 30 January 2020, abstract of report: https://www.pwc.com/gx/en/entertainment-media/outlook-2019/entertainment-and-media-outlook-perspectives-2019-2023.pdf
4 Key numbers, Newzoo, accessed on 10 January 2019, www.newzoo.com/key-numbers