The UK video game market was valued at £5.35bn in 2019, according to Ukie. This valuation is an overall 4.8 per cent decrease from 2018’s record-breaking results, which is likely due to the upcoming new console generation, with consumers waiting for the next big thing – as was the case of previous transitional periods.
2019 saw remarkably varied results for the sector. Game software saw a pause in its trend of yearly growth, seeing a small 2.1 per cent drop in revenues to £3.85bn. Meanwhile, hardware saw a much deeper decline, with a drop of 14 per cent drop to £1.35bn, again mostly likely due consumers waiting for the launch of the new console generation.
Despite lowered revenue in software and hardware, there has nonetheless been an increase in the broader interest in games culture, with game culture revenues shooting up 28.5 per cent to £146m.
Data from Omidia shows that within the software market, digital and online revenues have maintained their 2018 peak, with a small increase of 0.6 per cent to £1.98bn. Digital PC and console revenues now comprise 51 per cent of the UK games software market.
Physical game sales however, have fallen 21.7 per cent to 603m. Kantar Worldpanel data shows a similar story in pre-owned sales, which have dropped 18.7 per cent to £55.2m. Again, the coming console generation is likely a factor in this, as Kantar’s Sam Causley explains: “In what has been a fantastic year for the Switch, increasing their market share of mint game software spend to over 30%, Nintendo benefit this year from sitting outside the console cycle of both PlayStation and Xbox.”
Mobile game revenues have had a strong year, up 7.7 per cent to
Console hardware sales have seen a predictable drop due to the new generation of consoles. Console hardware revenues have fallen 30.5 per cent to £488m, according to Gfk entertainment. This is mirrored by a less dramatic drop of 6.8 per cent drop in console game accessories, to £331m. PC game hardware, meanwhile, saw a 6.1 per cent increase from last year, to £469m.
Despite the declines elsewhere, the interest in broader games culture remains strong. Game toys and merchandising revenues have enjoyed their first boom since the demise of Toys R Us, skyrocketing up 48 per cent to £94.2m. Fortnite-related merchandise played a large role in this, according to data from NPD.
The launch of the Detective Pikachu film drove up revenue for game-related films, video and music, which climbed 24.9 per cent to a combined £29.5m, according to data from the BFI, BPI and Official Charts Company. This trend seems likely to continue in 2020, with the Sonic movie seeing a strong box office showing before the cinema closures due to COVID-19.
Franchises such as Pokemon and Minecraft supported the game-related book revenues, but the overall decline in physical revenues and declining magazine revenues resulted in a drop of 21.6 per cent, to £13.9m.
2019 game-event revenue was strong, supported by events such as EGX and Insomnia, resulting in ticket revenues seeing just a small drop of 0.8 per cent to £8.8m. Unfortunately, due to the lockdown caused by the COVID-19 pandemic, it seems likely that 2020’s results will be less strong in this area.