Consumer spending breaks through the $4 billion mark
Sydney Australia, 23 May 2019 – The growth of the video game industry in Australia continues to go from strength to strength, with consumer spending breaking the $4 billion mark hitting $4.029 billion in the 2018 calendar year, a significant increase of 25 per cent from the previous year’s sales.
Australians’ ongoing love affair with video games is underscored by data released today by the Interactive Games and Entertainment Association (IGEA), which shows that total physical retail sales generated $1.179 billion and overall digital sales hit $2.851 billion last year, posting an increase of 39 per cent.
Key highlights include:
- The in-game digital purchase segment grew a staggering 190 per cent year-on-year, while digital full game revenue was also up by 20 per cent on 2017 sales
- Within overall digital sales, mobile is still one of the largest categories, posting 11 per cent revenue growth
- Physical retail sales reached $1.179 billion, a slight increase of 0.2 per cent
- Retail sales were bolstered by console accessories sales, up by 19 per cent
“The excitement for video games is continuing to grow, with phenomenal consumer sales in 2018,” said Ron Curry, CEO of IGEA. “Australia continues to experience video games sales growth, in line with trends similarly experienced by other countries, including the USA and the UK.
“In the coming months we will be releasing our biennial Digital Australia 2020 report, The Power of Games which will shine a spotlight on who plays games, why they play them, as well as offering insights into the use of games beyond pure entertainment.”
Research from Telsyte also revealed an upswing in total digital sales growth of 39 per cent to $2.851 billion, with the $3 billion mark well within reach. The biggest increase was experienced by sales of in-game digital extras, such as season passes, cosmetics and game expansions, which posted a whopping 190 per cent growth. Full digital download game revenue increased by 20 per cent on last year, while subscription revenue also continued on a growth trajectory, up 31 per cent in 2018.
According to Foad Fadaghi, Telsyte Managing Director, “Digital sales continue to impress with strong double-digit growth across downloads, mobile and subscriptions. The standout was the digital in-game extras market which grew by almost 200 per cent, driven by Fortnite, which continues to be a social phenomenon”.
Bolstering this digital growth, market data from The NPD Group indicates solid and continued interest in traditional retail, with physical boxed retail sales posting a modest increase. This growth was driven primarily by the increase in console accessories sales and the Nintendo Switch ™ showing a solid second year performance.
“Sales of physical video games continue to look strong. We saw a number of physical software titles break fastest-selling records, with standout launches from games such as Red Dead Redemption 2® , God of War®, Marvel’s Spider-Man®, Call of Duty Black Ops 4®, and Far Cry 5®, to name a few,” said Aidan Sakiris of The NPD Group. “We are now six years into this generation of consoles and hardware performance is looking strong with the various offerings available, especially when compared to the previous generation. Console Accessories have also seen the best performing year in Australian NPD tracking history, which continues to play an important role in the Australian video game market growth.”
You can download the accompanying sales data infographic here.
The recent Australian federal election shone a spotlight on the need for ongoing support for the local game development industry to take advantage of this popular, global entertainment medium.
“Given Australia’s appetite for games, in line with the global trends, we would like to see the re-elected Federal Government start to appreciate that the Australian Games Development industry is an integral part of the overall screen industry, thereby allowing the sector to access screen support programs available such as refundable tax offsets,” said Curry. “It is imperative that these innovative and creative Australian-based tech companies can compete on a level playing field globally with many other jurisdictions offering support. Australian games developers should be able to take advantage, culturally and economically, of the global growth of this wildly popular entertainment medium.”
IGEA recently published a paper, Building a Thriving Interactive Games Development Industry in Australia which explains how and why the Australian game development sector should be supported.
About the research
Since 2009, IGEA has provided a review of the state of Australia’s video games industry using commissioned research from The NPD Group Australia. With the growth of digital gaming, the NPD data has been augmented with research from Telsyte to provide a complete picture of the state of the industry.
IGEA is the industry association representing the business and public policy interests of Australian and New Zealand companies in the computer and video games industry. IGEA’s members publish, develop, 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, CEO of IGEA, please contact Rose Keating, Espresso Communications on +61 2 8016 2200 or firstname.lastname@example.org.
- For interviews with Foad Fadaghi, Managing Director Telsyte, please contact him on +61 414 992 466.