Digital consumption fuels New Zealand video game industry growth
Traditional retail records NZD$133 million of sales to support expanding sector
Auckland, New Zealand – 17 February 2014 – New Zealand’s interactive games industry has recorded $133 million of
traditional retail sales and an estimated NZD$162 million of digital sales in 2013, according to research released by
the Interactive Games & Entertainment Association (IGEA). These latest figures put the overall retail value of New Zealand’s interactive games
industry in 2013 just shy of NZD$300 million.
The latest data from independent market researcher, NPD Group Australia, reveals that sales of console hardware, games
software and gaming peripherals sold through traditional retail outlets dipped by eight per cent compared to sales in
2012.
However, according to research commissioned by IGEA, traditional retail sales only from part of the overall consumption
patterns. The research conducted by emerging technology analyst firm, Telsyte, estimated that in 2013 the NZ digital
video games market was valued at $162 million with revenue gained from digital game sales, downloads, subscriptions and
mobile games.
Mark Goodacre, IGEA’s New Zealand Director, said IGEA commissioned the Telsyte research in order to account for the
growing number of New Zealanders extending their gaming experience online and provides a better snapshot of the
burgeoning interactive games industry for its members.
“We’re seeing more New Zealanders consume games across a wide variety of consoles and mobile devices and consequently,
extend the ‘traditional’ console experience with in-game extras bought online or a version of the game which users can
access via their smartphone and other internet connected devices,” said Goodacre. “It is encouraging to see traditional
retail sales are strongly supported by New Zealand consumers choosing to purchase video games content both online and
‘offline.’”
“The interactive games industry is continuing to evolve as consumers of all ages and backgrounds continue to play games
at home and on-the-go and we expect sales figures to reflect this change in the market,” said Goodacre.
Sam Yip, Senior Research Manager for Telsyte, stated that the growth in digital sales was largely driven by the
popularity of mobile games, which accounted for 57 per cent of all digital purchases and digital content consumed on
consoles and PCs.
“Consumers spent more than $162 million on digital games, extras, subscriptions and mobile games in 2013, which account
for more than 50 per cent of the total spend for the interactive games and entertainment industry,” said Yip. “New
Zealanders continue to show an increasing appetite for content delivered digitally and these numbers reflect this
trend.”
Mark Goodacre added, “While this significant increase in revenue and the velocity of change in content and content
delivery excites the industry, it also poses increasing issues on the policy front, where legislation and legislators
lag a long way behind the industry. These results highlight the need for government to quickly engage with industry to
ensure that legislation can adapt to the speed of change facing New Zealanders.”
Other key highlights from NPD Group Australia reveal*:
· Console software was the most improved category in terms of dollar share compared to 2012
· During 2013 a number of software franchises including Grand Theft Auto, Battlefield, Bioshock, Tomb Raider and God of
War have improved their market share over 2012.
· A new franchise, The Last of Us, entered the Top 10 best selling titles in 2013
· PC Games subscription cards grew significantly compared to last year and reflect the shift on consumer preferences for
how they play games
· Console hardware was slightly down from 2012 although it is important to note that the 8th Generation Console Hardware
was sold only during the last 6 weeks of 2013 and this category is expected to improve in 2014.
Key highlights from Telsyte **:
· Mobile games (upfront and in-game purchases) account for more than half of the digital games market at $92 million,
followed by Digital Downloads (full games and in-game extras) at $36 million, Subscriptions (console network and MMOG)
at $22 million and Social/Casual games at $12 million.
· New Zealanders spend large amounts on gaming subscriptions. Eight percent of the entire NZ games industry is made up
of MMOG subscriptions, console network subscriptions and in-game spend.
· Consumers spent more than twice as much on in-game micro-transactions compared to up-front mobile game purchases in
2013. This trend is expected to continue with more freemium games flooding iOS and Android platforms.
· Consumers are expected to double their spend on digital downloads, subscriptions and services within online console
networks in 2014.
New Zealand’s own game development industry has capitalised on the growth of digital games globally. New Zealand-made
mobile games were downloaded over 130 million times last year and industry earnings grew 86 per cent to $36.3 million in
2012, according to NZ Game Developers Association research.
“Video games are now one of New Zealand’s largest creative IP exports. 100 per cent of games made here are digitally
distributed, which makes sense given New Zealand’s remote location,” said Stephen Knightly, NZ Game Developers
Association Chairperson. “Going digital has created huge opportunities for New Zealand developers. Digital means if we
have a hit game then sales aren’t capped, we can be responsive and continually update our games and have a direct
relationship with players.”
* Source: The NPD Group Australia. Category PC Games, Console Software, Portable Game Software, Time period(s) Jan 2
2012 – Dec 30 2012; Dec 31 2012 – Dec 29 2013. Country: Australia
** Source: Telsyte – IGEA Digital Market Monitor, 2013
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