New Zealand Video Game Industry Sales Drop For The First Time Since 2012

Every category except one experienced a decline in 2019, but 2020 should have better results thanks to PS5 and Xbox Series X.

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New Zealand's video game industry had a difficult 2019, but one local trade group believes the future is bright for the region thanks in part to the upcoming launch of the PS5 and Xbox Series X.

The Interactive Games and Entertainment Association (IGEA) released its report for New Zealand's game industry on Wednesday, showing that the total industry value in 2019 reached $501.4 million. This was down by 9 percent compared to last year, and it marks the first year-over-year decline since 2012. Note that this number covers total sales, not just for video games developed in New Zealand. For comparison, the IGEA also represents Australia, where 2019 industry sales reached $3.6 billion.

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There is a good reason for the downturn, however. 2018's results in New Zealand--as well as Australia, the US, and other parts of the world--were very positively impacted by the huge success of Fortnite. That game is now moderating in results, and as such, 2019 was always going to have a tough time comparing.

All spending categories in New Zealand experienced declines in 2019, including hardware, physical and digital games, accessories, and mobile. The only category that grew in 2019 was subscriptions, which jumped 16 percent to $67 million.

The IGEA said 2020's results should be better, thanks in part to the release of the PS5 and Xbox Series and their new games. Additionally, 2020's results will reflect an overall uptick in spending and engagement due to COVID-19, which is causing people to stay home more, IGEA said.

"2018 was certainly a hard act to follow, but despite the softening of video game sales in 2019, New Zealanders continue to embrace games and the different models available to purchase and consume them. More than ever, the first half 2020 has shown the power of games to connect, entertain, and educate," IGEA CEO Ron Curry said in a statement. "The release of new platforms and blockbuster games in 2020 should see a return to growth, resulting in games maintaining their position as the leading form of entertainment, both locally and abroad."

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