Indonesia is the fastest growing market for games in Southeast Asia

Total revenues from Southeast Asia’s gaming industry reached nearly US$1.1 billion last year, with six key countries accounting for 99 percent of the revenues generated from the entire region. According to gaming market research firm Newzoo, which released a 75-page report last week on the opportunities of the region’s gaming industry, Indonesia is now the fastest growing market. Firms like Facebook, Microsoft, Baidu, and Electronic Arts assisted Newzoo with the study, and the company claims the research is the largest of its kind in the region to date.

In terms of revenue, the six main drivers are Indonesia, Malaysia, the Philippines, Singapore, Thailand, and Vietnam. At a compound annual growth rate of 28.8 percent, Newzoo expects gaming revenues from the entire region to jump to US$2.2 billion by 2017, effectively doubling last year’s figures.

See: New players get aggressive in Indonesia’s game sector

A few key facts illustrate the region’s growth potential. Newzoo estimates the population of Southeast Asia at 626 million. Only a small share of these people have access to internet; about 29 percent, which represents 179 million consumers. In this group, gaming is extremely popular, the firm says. Over 70 percent of them play games.

Of these 126 million gamers, 60 million spend money on games. Last year, these 60 million consumers spent an average of $18.40 on games annually. As KPIs differ drastically per country in Southeast Asia, Newzoo believes Thailand will remain the largest games market in terms of revenues come 2017, followed closely by Indonesia and Malaysia. Similarly, Vietnam is expected to grow in line with the overall market to maintain its market share of 14 percent. Singapore will continue to grow, but lose some of its market share to faster growing countries, namely Indonesia and the Philippines.

The average Indonesian gamer spends Rp 200,000 (US$16) on games per year. The archipelago’s demographic strength pushes the country ahead of the pack, says Newzoo. Its enormous population of nearly 253 million now accounts for 40 percent of the entire Southeast Asian population. While Indonesia still has the lowest internet penetration rate in the region, it already has the largest online population, indicating huge future growth potential.

Editing by Mary-Anne Lee; lead image from Luke Ma.