Brazil and Mexico Power Gaming Revenues in Latin America - eMarketer

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Brazil and Mexico Power Gaming Revenues in Latin America

The two countries combined will contribute over 70% of total gaming revenues in the region in 2014

October 2, 2014

Global gaming revenues are set to expand 8% to reach $81.5 billion this year, according to an August 2014 GlobalCollect and Newzoo report. An estimated $36.8 billion in gaming sales—which excludes hardware, tax and consumer-to-consumer trade, but includes retail margin—and a base of 827 million gamers will put Asia-Pacific at the top of the list, with a handsome 45% share of the global market. Meanwhile, gaming revenues in Latin America were projected to reach $3.3 billion, or a 4% share of the worldwide total, with 185 million gamers.

Video Gamers Worldwide, by Region, 2014 (millions)

That revenue stream, while tiny by global standards, may spell opportunity in Latin America. Indeed, gaming revenues were forecast to post 14% expansion in the region this year, trailing only the 15% growth rate expected for Asia-Pacific.

Within Latin America, Brazil was expected to be the largest contributor to the regional total this year, at $1.34 billion, but Mexico should be a close second, with $1.01 billion. It is worth noting that, according to GlobalCollect and Newzoo, such revenue levels will take place with internet user bases of 118.6 million and 56.1 million.

The study forecast that desktop/laptop games and consoles for play on a TV would generate more than eight out of every 10 gaming revenue dollars in Latin America this year. But with an already massive market in Brazil and a sizeable base of advanced mobile device users in Mexico, gaming is ready to be reshaped.

eMarketer estimates there will be 277.7 million mobile connections, 153.8 million mobile phone users and 41.2 million smartphone users in Brazil in 2014. Mexico will reach 104.3 million, 75.8 million and 34.1 million in the same categories, respectively, during the same period. Smartphone user bases will expand by 36.0% and 22.7%, respectively, in Brazil and Mexico this year.

Gaming Revenues in Latin America, by Segment, 2013 & 2014 (millions, % change and % of total)

Against the backdrop of rapid growth in the two largest and most advanced mobile markets in Latin America, it comes as no surprise that GlobalCollect and Newzoo reported that mobile phone games (50% growth) and tablet games (75%) would be the two fastest-growing categories in 2014.

When it comes to payment methods among gamers in Latin America, credit cards were used to transact about nine out of every 10 dollars spent in the category throughout the region, according to H1 2014 GlobalCollect records. What is interesting, however, is that preferences for payment methods other than credit cards varied widely from country to country. Gamers in Argentina, for example, used bank transfers (6.6%) the most. But they were almost as likely to use an ewallet (2.5%) as were their peers in Mexico (2.6%). Cash, however, was the alternative payment method of choice for most gamers in Brazil (8.8%), an option rarely used in any other large market in the region.

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