Southeast Asia - Gaming Report

Introduction

On the 12th of April 2020, AZS Consulting has decided to utilize its gathered knowledge to conduct research on Southeast Asian (SEA) video gaming market.

The consultant of AZS Consulting has gathered, analyzed and constructed hypotheses on:

  • An average regional population who is utilizing the internet on a concurrent basis

  • Device maker division

  • Survey and Analysis – Top PC and Mobile Games

  • Market and Finance

  • Conclusion - Future market analysis

The following report aims to inform and showcase the market from an analytical point of view providing a non-biased based perspective of the market.

Prior to informing the reader about the results, we would like to give a massive thanks to all the contributors who made the following research possible, their names would be listed at the end.


Average regional population who is utilizing the internet on concurrent basis


Utilizing the Worldbank database AZS Consulting was able to extract the data of the percentage of individuals who are connected to the internet in the SEA region. The following historical data was of extreme importance due to the ability to find the regional compound annual growth rate (CAGR) of 25% from 2000 to 2018 that indicated a mass adoption of the internet. The results were expected for the developed market, such as Singapore that has the fastest broadband connection in the region. Whereas Singapore may be connected via wires, the majority of other countries have decided to skip broadband and implemented 3G and 4G adoption.

Note:

  • In 2015 Philippines has been struck by a devastating typhoon, Typhoon Koppu, that left people homeless and had a destructive force on infrastructure.

  • In 2015 Cambodia faced a massive crackdown on government opposition that reduced access of the population to the internet to battle the spread of information.


The regional online population has boomed throughout the years and whereas some regions may have reached their approximate peak, such as Brunei Darussalam, there are still markets where the infrastructure and accessibility has a long way from majority population adoption, such as Lao Pdr (Laos) with 34.4% of the population online.


In retrospect, the country which saw the widest adoption in Myanmar with 98% CAGR from 2000 to 2018. The country has boomed in the connectivity from 2011 to 2018 this growth has been accredited to the dedication of local companies in their investment in 3G and 4G technology. Prior to 2011, the number of connected individuals did not exceed 0.25% whereas today we see 58% of the population having the ability to leisurely browse the World Wide Web.

AZS Consulting believes that Lao Pdr will see similar growth, but unlike Myanmar, the growth would be spread through a number of years and based on the country’s CAGR it is believed that by either end of 2020 or mid-2021 65% of the population would have access to the internet; note that the range of dates has been set due to the current pandemic of COVID-19 and slowdown of global development.


Device market division

In order to understand the division of devices, AZS Consulting had to take a two-step approach.

At the beginning of the process, we have decided to take an average of the regional device division, taking into account each market and its distribution.

Upon further investigation and discussion with professionals in the SEA region, the consultant has discovered that the following results did not meet their expectations. Upon taking the Asian region on average the results satisfied the professionals and we have decided to utilize them instead of following up with Table 1 our average.

Note: Based on the research we believe that the Mobile market is even bigger than currently assumed a number of 61%, as based on the 2017 Google report 90% of regional traffic has been conducted through a smartphone.

Based on the following information the consultant was able to construct an assumption on what is the approximate number of devices on the market.

Upon further investigation, the consultant needed some basis to enforce the following assumption. An article “Smartphone sales continue to grow in Southeast Asia” by Warc we have discovered that the summing number of mobile phones in five key markets of SEA was 97 million devices, which provided us with 1.95 discount on the previously constructed assumption. With the confidence level reaching 90% we have applied the discount across all devices.


Survey and Analysis – Top PC and Mobile Games

While conducting research on top PC and Mobile games in the SEA region the consultant has faced multiple barriers of region’s information. Despite that AZS Consulting has decided to pursue the survey methodology of the PC with mobile information is publicly available. In the following section, AZS Consulting will showcase the results of its findings.


PC Games

In order to provide non-hypothetical data and have a form of validation AZS Consulting conducted two-step methodology of surveying the population in SEA region and has taken a small pool of 60 individuals from Singapore, Thailand, Vietnam, Malaysia, Philippines and Indonesia. The secondary step was having a discussion with professionals from the respective countries to validate the findings and possibly identifying outliers, something that was not required as the professionals validated all the data.

Note: Below provided results follows a point-based system, 5 being the highest and 1 being the lowest.


Table 2: Thailand Biggest PC Games

Table 3: Singapore Biggest PC Games

Table 4: Vietnam Biggest PC Games

Table 5: Malaysia Biggest PC Games

Table 6: Philippines Biggest PC Games

Table 7: Indonesia Biggest PC Games


We would like to again thank all the participants in the survey, who will be mentioned at the end of the following report.


Based on the results of the survey AZS Consulting was able to extract the information on the biggest PC games in SEA:

Table 8: Top PC Games in SEA


Upon the discussion with regional professionals, there has been confirmation that the SEA’s top games are aligned with the above table. As seen in Table 8 DOTA is a regional leader in the gaming sphere, followed by LoL and CS:GO to make up the top 3 PC games in the market. With a recent announcement by Riot that Vietnam would receive 2 seeds in Worlds 2020 and establishment of Singapore office AZS Consulting believes that Riot Games is solidifying its presence in the region a lead game developer leader, even though the current reigning champion is Garena.

Mobile Games


The mobile gaming market has seen an immense increase in the past years. With the smartphone hardware market reaching its peak where there is no immense difference between flagship and budget phones the mobile game developers are able to reach a much bigger market without requiring top of the line chipsets.

Table 9: Top Mobile Games – SEA


Mobile Legends is currently dominating the market. The reasoning makes perfect sense, when having a discussion, the similar experience to Mobile Legends of quality gameplay would be Free Fire and PUBG, whereas Free Fire can adapt to the performance of the smartphone, PUBG is a more resource-heavy.

None of the game can compare to the gameplay, excitement and adaptability of Mobile Legends with minimum requirements of having “potato phone” (low-tier smartphone).


“Even homeless people play Mobile Legends” - Jonathan Lovell

Mobile Legends Minimum Requirements:

Note: Android 4.0 (Ice Cream Sandwich) runs back all the way to the Galaxy S or Nexus S and iOS 9.0 goes back to iPhone 4S!

As seen from the specs above the barrier to play is almost non-existent for Mobile Legends making it available to the much larger player group who would like to spend their leisure time playing video games with no requirement to invest a large sum of money on their phone.


Market and Finance


With processing of the previous information and identification of the market, AZS Consulting wanted to take a look at the financials of the market. In SEA there are two different markets, the highly rich Singapore and Brunei and then the other markets which have the immense population, however, are developing at an astounding pace.

As the reader may see Singapore and Brunei Darussalam make up 63% of total regional GPD per Capita, yet AZS Consulting would like to note that the largest economy by GDP in SEA is Indonesia and Thailand, with Singapore on the 4th place and Brunei Darussalam being 10th, smallest in the regions. The biggest difference between the largest Nominal GPD countries and Singapore and Brunei is the population difference, hence Nominal GPD is distributed among fewer individuals.

Table 10: SEA Gamers, Population and Revenue per Gamer


Based on Graph 4 we can see an alignment with Graph 5 where the largest Revenue per Gamer is from Singapore followed by Brunei Darussalam. We can see that the Total Revenue and Number of Gamers in Indonesia exceed all other markets significantly despite being the 6th largest Revenue per Gamer generator.

The following information could be of importance to the advertisers with a strategy of either generating the largest revenue or understanding what the cost per acquired user would be in the respective markets.

Additional information that would be of importance to advertisers is which demographic is the most revenue-generating. We can see from the graph above that throughout the regions the largest video game spenders are males from 21-35 year of age, a generation that was raised during the expansion of video games and who are revenue-generating.

This age group is followed by Males from age of 10-20 who will become the largest spenders in the region as the current population distribution looks like the following:

Within 10-15 years of years, the new generation of games will join the workforce and will become a new potential clientele for video game developers.

The last age group would be females from age 21-35 with Thailand being the largest spender and the only region passing the 20% thresh hold.


Conclusion - Future market analysis


With wider mobile adoption, gaming will continue to flourish as we saw the CAGR of 26% from 2016 to 2019 and mobile CAGR is expected to be 22.9% from 2018 to 2028. Additionally, it is expected that that SEA Internet Economy will reach a whopping 300 Billion USD by 2025.

After conducting the full research on SEA AZS Consulting’s prospective for the region is extremely positive. The mobile adoption will continue to grow and despite the economic slowdown caused by COVID-19 the market is expected to pick up the pace in upcoming years.

Gratitude to Participants

AZS Consulting would like to thank all the individuals who participated in the survey and professionals who assisted us in making of the following report:


Jesus Garbayo, Jonathan Lovell, Vidge, ChaseFlame E-Sport, Haikan Renaldi, Joel, Na', MINGXXIV, Bgsat, Rhea, Mocha, Yellowtnos, Makkonk, Dekita, Bananacake, Poofy, Zan Zhuang, Kin, Rukbat, Jack, lipi_gadang, Centizm, Orang Muda, Gelo, Maafkan Mirul, Harleen, Solo, Lumpsins, Ciapuni, Cosmo, Farah, Seele, Wong, Yuna, Kenco, RAIRU, Shiki, Nasneg, Wan, Kalbo, neneng, Gab, Jay, diuwu, Mutsuya L, Trouble, Aunt Pa, Saturn, SanGSEM, Conal, K, Chấu, lMoN_E|E|, Truong, SeaFirst, Ber, mood, Kim, Bew, Huy, Safe, Panda


Sources:


“Desktop vs Mobile vs Tablet Market Share Asia.” StatCounter Global Stats, gs.statcounter.com/platform-market-share/desktop-mobile-tablet/asia


“Economic Update: South East Asia.” ICAEW,

https://www.icaew.com/technical/economy/economic-insight/economic-insight-south-east-asia


“Follow the Leaders: Highest Ranking Apps in Google Play Store, Philippines.” SimilarWeb,

www.similarweb.com/apps/top/google/store-rank/ph/all/top-grossing


“Individuals Using the Internet (% of Population).” Data,

data.worldbank.org/indicator/it.net.user.zs


Insights, Future Market. “Mobile Device Management Market to Grow at a CAGR of 22.9% by 2028- Future Market Insights.” GlobeNewswire News Room, "GlobeNewswire", 28 Feb. 2019

www.globenewswire.com/news-release/2019/02/28/1744230/0/en/Mobile-Device-Management-Market-to-Grow-at-a-CAGR-of-22-9-by-2028-Future-Market-Insights.html


Moore, Molly. “SEA Mobile Gamers by Age and Gender 2016.” Statista, 14 June 2018,

www.statista.com/statistics/692065/southeast-asia-mobile-gamers-by-age-and-gender/


“Smartphone Sales Continue to Grow in Southeast Asia.” WARC,

www.warc.com/newsandopinion/news/smartphone-sales-continue-to-grow-in-southeast-asia/43334


“Video Games - United States: Statista Market Forecast.” Statista,

www.statista.com/outlook/203/122/video-games


“EConomy SEA 2019.” Bain, Google Temasek,

https://www.bain.com/globalassets/noindex/2019/google_temasek_bain_e_conomy_sea_2019_report.pdf


“League of Legends Mid-Season Invitational Canceled for 2020” Graham Ashton, https://esportsobserver.com/riot-cancels-lol-msi/

“We’re Opening a New Game Development Studio in Singapore” Riot Games, https://www.riotgames.com/en/news/were-opening-a-new-game-development-studio-in-singapore


"World Report 2015: Rights Trends In World Report 2015: Cambodia". Human Rights Watch, 2020, https://www.hrw.org/world-report/2015/country-chapters/cambodia


"Typhoon Koppu Brings Extreme Rainfall To The Philippines". NASA, 2020, https://www.nasa.gov/feature/goddard/koppu-nw-pacific

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Copyright © 2019 AZS Consulting. All rights reserved. The following report is for informative use only and is subject of copyright by AZS Consulting.

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