Video Games in Indonesia

PRE-COVID-19 PERFORMANCE

While high prices hinder growth of video games hardware, mobile games flourish as smartphones become more affordable in 2019

Video games hardware has never reached its full potential in Indonesia due to its high price point. Indonesia’s disposable income per capita was below IDR3 million per month in 2018 and a Nintendo Switch or PlayStation 4 console costs more than that.

Growth of VR products is limited due to high prices and limited number of VR-compatible game titles in 2019

In 2019, VR was no longer the “up-and-coming” new technology compared to how it was viewed four years ago. Consumer hype over VR started dying down as manufacturers struggled to sell more products.

Nintendo and Garena, the leading players in video games hardware and software, respectively, both gain considerable value share in 2019

Nintendo remained the leading player in video games hardware in 2019. Nintendo Switch has been gaining popularity within Indonesian families that are increasingly using it for family recreation, and it gained considerable value share in 2019 at the expense of its chief competitor, Sony.

2020 AND BEYOND

COVID-19 impact

In 2020, sales of video games are now expected to grow by 20% in constant 2019 value terms in light of the impact of COVID-19. This compares to an 18% rise in sales forecast in our 2019 edition of toys and games.

Affected products within video games

While video games overall was enjoying double-digit year-on-year growth throughout the 2014-2019 review period, the categories that are set to see the most significant boost in 2020 as a result of the CODID-19 pandemic and rising interest in e-sports as a replacement for physical sports events are console games (digital) and mobile games, the latter of which saw a strong increase in the number of active users during this time. As a result, in-game purchases for both console games (digital) and mobile games also are set to register stronger growth over the year.

Recovery and opportunities

In 2020 and beyond, the leading video games software player Garena is set to keep growing as it keeps pushing new innovations and grows its e-sports tournaments. PUBG Mobile and Garena Free Fire were both expected to expand their e-sports tournaments in 2020, after Garena had already started 2020 strongly with the release of a new battle map for Free Fire, Kalahari.

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