The key to growth in Taiwan's gaming industry slowing lies in 5G penetration and affordable high-speed transmission plans.
During the COVID-19 pandemic, the gaming market saw a boost in demand as people were forced to stay home. However, with growth in the industry slowing down post-pandemic, the key to maintaining growth momentum lies in 5G penetration and affordable high-speed transmission plans.
Taiwan's esports sector shows a much higher growth rate than other sectors. This demonstrates great development potential as the business model slowly matures.
According to the Global Entertainment & Media Outlook 2023-2027 report released by PwC Taiwan, the overall revenue growth rate for Taiwan's gaming and esports industry in 2022 was only 1.6% year-on-year, reaching US$3.5 billion. Nevertheless, driven by the social/leisure gaming and esports industry, an overall compound annual growth rate (CAGR) of 4.8% is still expected.
Social/leisure games contributed a large majority of the revenue in Taiwan's gaming sector.
They account for around 70% of the sector's takings.
Industry sources pointed out that with the widespread adoption of mobile networks and devices like smartphones and tablets, mobile games have long occupied the largest portion of the market, and a large percentage of that consists of social/leisure games. This trend is expected to continue in the future.
The second largest portion is occupied by the traditional gaming market. In Taiwan, the market primarily relies on PC games, which is expected to continue growing steadily with a 3.1% CAGR.
The esports sector is the most noteworthy aspect of the gaming industry's future in Taiwan. Data shows an impressive average annual revenue growth rate of 22.2% over the past five years.
Although its overall market share is still relatively low, the government's recognition of esports as an official sport has generated increased interest from domestic and overseas entities in the Taiwanese esports and gaming industries. This includes hardware manufacturers, financial holding institutions, and telecommunications companies.
These companies are investing in and sponsoring esports teams or crossing into the gaming industry. For instance, Taiwan Mobile has partnered with League of Legends developer Riot Games to act as its distributor in Taiwan to explore the gaming industry with its foundation of millions of users, sales channels, and data.
The recently concluded Taipei Game Show 2024, held from January 25 to January 28, is also a showcase of the enthusiasm consumers and gamers have for esports events and offline activities. According to official statistics, the four-day event accumulated a total of 360,000 attendees from 35 countries and regions, with over 1,800 business participants.
Also, the launch of Apple's Vision Pro could push the gaming industry into a more immersive interactive experience. Although Vision Pro itself won't necessarily focus on gaming, other hardware manufacturers, such as Meta and its Quest series, could make their devices more lightweight and delicate to venture further into the sector and improve on the currently restricted AR/VR gaming experience.
Article translated by Jack Wu
