PwC: Australian gaming and esports advertising is growing at 17% a year

By Mariam Cheik-Hussein | 18 June 2019

The interactive games market is forecast to become the fastest growing segment in consumer media spending, driven largely by in-game microtransactions, according to PwC.  

PwC's annual Australian Entertainment and Media Outlook report forecasts that the games and esports sector will more than double to $7.1 billion in 2023 from $3.45 billion in 2018. 

In-game microtransactions and the rapid adoption of 5G, in addition to cloud-based technology, will be the primary growth drivers of the sector.

Online/microtransactions will have an annual compound rate of of 33.1% over the next five years, followed by esports at 18.3%, and games advertising at 17%.

The single upfront cost model to purchasing games is declining, while the new free-to-play, multiple in-game microtransaction model is increasing revenue per user.

“More money is also entering the gaming ecosystem as Australian gamers are professionalised into athletes and esports enter the mainstream,” the report states.

“The presence of Fortnite: Battle Royale at the 2019 Australian Open and partnerships between the AFL and Riot games demonstrates that many sporting bodies are trying to capitalise on esports younger audience.

“Esports has increased its sponsorships, prize money pools, and has the opportunity for marketers to access hard to reach audiences, all while creating a generation of professional gamers who are able to monetise their skills through content distributed on Twitch and YouTube.”

Prize money for esports runs into the millions, with Australian champion OG’s Anathan Pham taking home $US11.3 million at The International, an annual Dota 2 tournament.

Recently, Google gave its game streaming platform Stadia, which allows users to play games while Google’s server handles all the processin, a November launch date. The platform is touted as a new source of data for advertisers.

The other big tech players, Amazon, Apple and now Sony and Microsoft, are also entering the space with their own offerings. 

Locally, Nova Entertainment and HT&E Events has been investing in esports.

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PwC results

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