Digital sales trump traditional sales in NZ games industry: research

The latest figures from research commissioned by the IGEA puts the overall retail value of New Zealand’s interactive games industry in 2013 just shy of NZD$300 million.

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 and 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.

According to the research, commissioned by IGEA and conducted by technology analyst firm, 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,sSubscriptions (console network and MMOG) at $22 million and social or casual games at $12 million.

Traditional retail sales only from part of the overall consumption patterns, according to the IGEA research. This complements the data from market researcher, NPD Group Australia, which states 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.

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.”

According to the research, consumers are expected to double their spend on digital downloads, subscriptions and services within online console networks in 2014. Consumers also 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.

Mark Goodacre, IGEA's NZ director said, “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.”

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