Australian video games industry records $1.161 billion sales in 2012

Sydney, Australia – 13 February 2013 – Australia’s interactive entertainment industry has recorded $1.161 billion of ‘traditional  retail’ sales in 2012. Despite a contraction of 23 per cent compared to computer and video game sales in 2011, the Interactive Games &  Entertainment Association (iGEA) remains confident in the industry’s health, as the gaming community supplements their traditional gaming with mobile and online content.

The latest data from independent market researchers NPD Group Australia, which includes all revenue generated from console hardware, games software and gaming peripherals sold through retail, reveals a 23 per cent contraction from the corresponding 2011 period. Yet, as the NPD data excludes sales from online retail, downloadable content, online games subscriptions, in-game micro-transactions and  mobile games, iGEA’s CEO Ron Curry said that the data fails to account for the growing popularity in the mobile and digital space.

“As Australians consume video games across a broader range of mediums, it’s becoming harder to get a true indication of the value of the industry via a single source.  While there is a decline in traditional sales, the gaming industry as a whole remains buoyant as people shift towards a ‘hybrid’ model in their consumption of interactive entertainment.”

Local technology analyst firm Telsyte expects that Australians will spend over $730 million on digital games subscriptions, virtual goods and mobile games in 2013 – an increase of 18% from the estimated $620 million generated in 2012.  “The growth in digital gaming is driven by mobile app gaming on smartphones and tablets, which is offsetting the decline in physical purchases and even pushing the overall games market into growth” says Sam Yip, Senior Research Manager for Telsyte.

Curry added, “Apart from the increasing move towards digital content, the figures released by NPD show a drop in physical sales due in part to the ageing gaming consoles, a trend we saw back in 2005 at the end of the last console cycle.”

Another key report highlighting the growth of the total interactive entertainment market is PriceWaterhouseCoopers’ Australian Entertainment and Media Outlook 2012 – 2016 which forecasted that the local interactive games sector will grow by a compounded annual growth rate of 7.4 per cent over the next 4 years.  Furthermore, the interactive games sector is expected to demonstrate the biggest growth area in consumer spending with the exception of the Internet, out-stripping the forecasted growth of Music, Film and  Subscription Television.

A sector capitalising on the growth of digital is the Australian game development industry with Antony Reed, CEO of the Games Development Association of Australia (GDAA), pointing to the recent announcement by the Federal Government to invest $20 million to the games development community as a sign of the health of the local industry.

“The funds represent an investment in an industry that has continued to develop in Australia, with local game developers continuing to show their capabilities around the world. The continued success of Firemonkeys, 2K Games Australia, Halfbrick and Kumobius are clear examples of the strength of the industry here in Australia. The investment by the government will be used to further secure jobs,  encourage innovation and creativity, and promotes investment in Australian talent,” said Reed.

Key highlights from NPD Group Australia:

• December 2012 pointed to increased spending on annualised franchises like Call of Duty, Skylanders, Assassins Creed and FIFA.
• Based on the top 10 computer and video games in December 2012, the value generated by those ten titles accounted for 46 per cent of all sales, up over 12 per cent from the previous top 10 titles in December 2011
• The PC market saw a unit increase this year, up 3.4 per cent on 2011 behind strong performances from titles such Diablo III and  Guild Wars 2.
• While overall hardware units declined by 26.9 per cent , high definition consoles experienced a much softer decline of 10.6% per  cent
• With consumers becoming more price conscious and looking for value and deals in their purchases over the Christmas period,  consoles with bundled software or accessories grew by 66 per cent in dollars over December 2011
• Gaming peripherals did see increases in units and value this year, as units grew by over 20 per cent largely due to the success of  Skylanders Giants.

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About the iGEA

The iGEA is an industry association representing the business and public policy interests of Australian and New Zealand companies in the computer and video game industry. iGEA’s members publish, market and/or distribute interactive games and entertainment content and related hardware including mobile and handheld games.

For more information, please visit www.igea.net.

Media spokespeople available:

• For interviews with Ron  Curry (iGEA) or Antony Reed (GDAA), contact Grace Gabriel Espresso Communications (+61 431 528 127 or +61 2 8016 2200)
• For media interviews with Sam Yip, Telsyte, please contact him directly on:+ 612 8297 4607
• For media interviews with Andrew Milgate, please contact him directly on +612 8257 6465