Next prospects for global and local gaming

In a world that has become more interconnected, gaming has taken over digital screens. This gaming obsession is only expected to grow stronger as consumers around the world continue to keep on playing in the next few years or so.

Gaming has become one of the fastest-growing segments in entertainment and media. In a report, PricewaterhouseCoopers (PwC) projects the gaming industry will exceed $300 billion, making up 9% of the entertainment and media market by 2028.

The growth of the gaming market has created a positive cycle, drawing in more people into gaming media and products across all genres. This surge has resulted in a rise of high-quality games and an increase of gaming-related content worldwide.

Along with this boom, the online games gaining the most traction are app-based social and casual games. Some examples include Pokémon Go, Animal Crossing, and Roblox, among others, which keep users hooked and engaged. Projections for 2028 indicated a 5.15% increase of revenue from this segment, accounting for 75% of the global video games and e-sports market.

Among regions, Southeast Asia is leading with a massive player base and a dominating share in the global gaming revenue. The report revealed that this region is expected to generate $181-billion revenue, which will make up 54% of the global gaming segment in 2028.

Moreover, on a global scale, the electronic gaming segment is experiencing critical growth, amplified by continuous technological advancements. A 2024 TGM Research report revealed that, across 34 countries, 39% of respondents engage in sports betting activities and gambling, with approximately 17.6 million adults participating. Notably, the report indicated that 21% of these gamers tend to play online sports betting a few times a week, with a preference of playing via the internet or in mobile apps instead of going at casinos or sportsbooks. In the Philippines, there are several online gaming platforms available, such as BingoPlus, Casino Plus, Okada Online Casino, and Solaire Online.

Sports betting and casino games have also spurred online betting and gambling to reach new heights in recent years. Business consulting firm Grand View Research valued the online gambling market at $63.53 billion in 2022 and predicted the sector’s compound annual growth rate (CAGR) to grow by 11.7% from 2023 to 2030. This rapid growth is driven by the legalization of online gambling in various regions, the rise of live dealer games, and e-sports which have attracted a broader audience, making online gambling more interactive and engaging than ever before.

Furthermore, according to a Boston Consulting Group (BCG) report, from 2017 to 2021, gaming grew at an impressive annual rate of 13%. This growth was primarily driven by innovative advancements that attracted more players and increased engagement.

However, in the following years, the double-digit growth slowed down significantly. In its 2024 report, growth rate from 2021 to 2023 dropped to 1%, and this single-digit growth is expected to continue until 2028, with an annual growth of 5%.

One of the challenges the industry faces is the rising costs of game development. Between 2017 and 2022, budgets increased by 6%, and it will continue to increase to 8% from 2022 to 2028, the report said. Because of this shift, the industry can experience reduced investments in game development, job losses, and studio closures.

To adapt to these changes, the industry must navigate the evolving landscape. Despite slow growth, opportunities still exist for the gaming industry. The report highlighted key trends and drivers, such as “embracing artificial intelligence (AI) and automation, developing a subscription strategy, taking a nuanced approach to price increases, monetizing emerging markets, exploring advertising, and focusing on untapped demographics.”

“The gaming industry is at a pivotal moment, with everyone asking the same question, how do we regain momentum; while a groundbreaking innovation may shape the long-term future, the near-term path to grow lies in embracing new monetization strategies and reaching untapped markets and demographics. Although returning to pre-pandemic growth rates may be challenging, gaming remains the most immersive and enduring entertainment medium,” Ernesto Pagano, managing director and partner at BCG, said in the report.

In the Philippines

The world of online gaming has firmly established itself, with the Philippines right in the digital mix, driven by active online users and high internet penetration rates.

www.pagcor.ph

The country’s electronic gaming segment has been pretty big. Most players boast strong interest in mobile gaming, e-sports, and role-playing games (RPGs). This surge in online gaming has firmly placed Filipinos on the global gaming map.

According to the Philippine Amusement and Gaming Corp. (PAGCOR), the gaming revenue for the Philippines saw robust performance in 2024. It saw a 41% increase, which generated a record-high of P112-billion gross gaming revenue. According to PAGCOR data, gaming operations and license fees stood at P97.52 billion. Key contributors to this growth are e-games and e-bingos, which brought P48.79 billion, or 50.03% of gaming revenues, for the year.

“The continuous growth of the e-games sector is the key driver of PAGCOR’s record-breaking performance. It reflects the increasing popularity of digital gaming platforms and the transformative impact of technology on the industry,” Alejandro H. Tengco, chairman and chief executive officer of PAGCOR said in a statement.

Furthermore, the figures showed that gaming operations generated a total revenue of P97.52 billion. Contributing to this total, e-bingo, e-games, and bingo guarantees accounted for 50% (P48.79 billion), licensed casinos for 33% (P33.07 billion), Casino Filipino venues for 12% (12.67 billion), and offshore gaming operations for 3.07% (P2.99 billion).

Looking ahead, e-games remains a significant sector in the Philippines. This year, the electric gaming sector is only going to get bigger and better, with projections indicating it will reach P160 billion in gross gaming revenue. This follows impressive 2024 figures, showing a 51% increase and a P16.77-billion year-on-year net income, according to PAGCOR’s data.

Additionally, the gaming regulator is reducing its fee rates for e-games from 35% to 30%. This change is intended to create a favorable regulatory environment, encouraging online gaming operators to join the legal market. With lower rates, the number of licensed e-games operators is expected to rise, and operators will gain more resources for marketing.

Statista, meanwhile, forecasts $28.32 million of online gaming revenue to be achieved in 2025. The number of users is expected to grow to 18.2 million by 2029, with user penetration estimated at 14% this year, and increasing slightly to 14.2% by 2029. — Angela Kiara S. Brillantes and JAMC