Digital gaming is on the rise, as retail games hit a wall.

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Australia’s games industry is alive and kicking despite more than 10% sales landslide, says gaming body, Interactive Games & Entertainment (iGEA), today.

The startling drop – 12.8% – in gaming sales in ‘traditional retail’ outlets like GAME and EA Games, come as a rise in online games explodes.

Retail gaming sales fell to $1.5 billion in 2011, according to research group NPD Group Australia, whose figures include revenue from console hardware like PS3, games software and gaming peripherals.

However, NDP figures exclude online sales, game subscriptions, in-game micro-transactions and mobile games, and those within  Facebook and smartphones.

It’s becoming more challenging to aggregate sales data through a single source, admits iGEA’s CEO Ron Curry, as Aussie gamers  continue to access video games through “a host of different channels.”

“Whilst the NPD data has revealed a dip in ‘traditional retail’ sales, which according to our latest Digital Australia report still represents the lion’s share of the games industry, other research has pointed to the growth in digital downloads,  multi-player online games, in game purchases and online subscriptions,” says Curry.

And analysts Telsyte seem to agree and estimate Australians will spend over $450m in online gaming, subscriptions and in-game purchases this year.

“Online gaming subscriptions and in-game virtual goods sales are growing strongly in Australia, and will account for around 20% of the overall digital goods and online subscriptions market (which consists of 26 categories such as Internet video, Internet music and digital news subscriptions) in 2012,” Sam Yip, Senior Research Manager at Telsyte, says.

PriceWaterHouseCooper has also forecasted both traditional and digital sales to hit $2.5 billion revenue in 2015, with close to half of this coming from online and mobile games.

 “Overall, we’re seeing a lot of evidence point towards a continuing healthy interactive games industry.  The incredible success of games such as Call of Duty 3: Modern Warfare 3 which became the fastest entertainment property to hit the $1 billion milestone globally, eclipsing the previous record set in 2009 by the film Avatar, is only one example of this.” 

Anthony Reed, CEO of the Games Development Association of Australia (GDAA), also credits the success of local games developers as a driving force behind the interactive entertainment market.

Australian game development industry also witnessed “exceptional growth” last year, despite the high profile collpase of Sydney based Team Bondi, the creators of LA Noire and Melbourne based Visceral Games, a subsidiary EA Games.


The good news was Brisbane’s Halfbrick Studios recorded over 120m downloads of their smash-hit, Fruit Ninja, and 11m for the recently released, Jetpack Joyride.

Melbourne-based IronMonkey Studios won Apple’s coveted ‘Game of the Year’ award with DeadSpace.
And we will see many more innovative and creative properties made by Australian studios releasing globally in 2012, says Reed.

However, NDP did indicate some trends going forward – the top 20 games from categories  included shooter games, action and sports like EA Soccer 2012.

Software sales also peaked during Christmas (weeks 51 and 52) which was up 13%.

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