Report: Console Market Is Growing At An Incredible Rate Of $5 Billion Per Year

According to a report, the video game console market is growing at an incredible rate. The report has been published by Steve Bailey, a Principal Senior Games Analyst at IHS Markit. According to the report, the amount of money spent worldwide on console content and services has steadily risen from $27 billion in 2017 to $32 billion in 2018, making it a $5 billion increase per year.

The total figure jumps up to a staggering $47 billion if hardware expenditure is included, the highest in eight years. In 2017, the total amount including money spent on hardware was $42 billion.

Bailey’s report goes on to say that amount spent on consoles worldwide will continue to see an increase in 2019 thanks to the strong sales of Nintendo Switch as well as other late consoles like PlayStation 4 and Xbox One. It is likely this number will also be positively impacted by the Nintendo’s “Switch Lite”, which is expected to release sometime during fall 2019.

“On a global basis, combined sales of games consoles reached volumes not achieved since 2009, with Microsoft’s Xbox One maintaining global market share due to a low single-digit increase in unit sales in the United States,” writes Bailey in his report.

Bailey also says that the sudden rise of Switch sales impacted PS4 sales in some way.

“Sony’s PS4 maintained market leadership in terms of unit sales, but Nintendo’s Switch, now in full supply, started to eat away at that share, albeit not to the extent that some may have been expecting.”

According to Bailey, games from last year like God of War on PS4, Forza Horizon 4 on Xbox One, and Super Smash Bros Ultimate on Nintendo Switch played an important role in the console market’s upward health. Bailey added that other games that are more towards the “Games as a service (GAAS)” side such as The Division 2, Destiny 2, Anthem are now “a fully-fledged proposition for this generation of consoles.”

While speaking with GameDaily.biz, Bailey said:

“I think people are now more receptive to digital consumption than they were at the start of the generation,” Bailey told GameDaily.biz. “It’s been over five years, and the barriers to such adoption have been eased, thanks to digital discounting having become so competitive, compatibility with third-party solutions to expand storage, a shift toward subscription models for game access, etc.”

He also spoke about digital-only hardware like the Xbox One S All-Digital Edition and said:

“A digital-only console could’ve been released many years ago, but it needed to be an option, not compulsory. I think this still holds for the incoming generation, too.”

According to a study by Jon Peddie.com, an estimate of 20 million PC players will most likely shift to consoles by 2020. With tremendous growth already seen in the console market, it is likely the numbers will continue to rise.

Steve Bailey’s full report on Digital console storefront strategy and game pricing: March 2019 can be found here.