For decades, video games have brought joy to countless children around the world. And with more adults playing games in recent years, the industry has become truly massive in its size and scope.
The statistics that follow will help to give you a sense of the awesome scale of the global video game market.
Image source: Getty Images.
The stats
1. There are more than 2 billion video game players worldwide, according to market intelligence company Newzoo.
2. Here in the United States, 63% of households have at least one person who plays video games regularly (3 hours or more per week), while 48% of U.S. households own a dedicated game console, according to the Entertainment Software Association.
3. And its not just kids who are playing these games; the average game player age is 35 years old.
4. In fact, while 27% of game players are under 18, 26% are 50 years old -- or older.
5. As for gender, 59% of game players are male, while 41% are female.
6. In stark contrast to the image of an isolated gamer locked away in a dark basement for hours on end, gaming appears to have a significant social element to it; 53% of the most frequent game players say video games help them connect with friends, and 42% feel video games help them spend time with family.
7. Moreover, the most frequent gamers who play multiplayer and online games spend an average of 6.5 hours per week playing with others online, and 4.6 hours per week playing with others in person.
8. In a sign that the industry has won increased parental approval, 68% of parents say video games are a positive part of their child's life, and 62% of parents whose children are gamers play computer and video games with their children at least weekly.
9. There appear to be benefits to video game playing in addition to just having fun. Of the most frequent gamers, 75% believe playing video games provides mental stimulation or education. This coincides with a study by Yale University that showed that students who played a brain-training video game for 20 minutes three times a week for four months performed better on reading and math tests than their peers who did not.
10. These perceived benefits are likely contributing to the growth of the U.S. video game industry, which saw video game software sales rise 6% to $24.5 billion in 2016, according to the ESA.
11. On a global basis, the video game market reached $99.6 billion in revenue in 2016, up 8.5% compared to 2015, according to Newzoo.
12. China, which, like the U.S., accounts for nearly a quarter of all global game revenues, is expected to approach $29 billion in game revenue by 2019, up from $24.4 billion in 2016.
13. Newzoo estimates that mobile gaming generated 37% of total global video game revenue in 2016, rising 21.3% year over year and surpassing PC revenue for the first time ever.
14. Still, PC and console-based gaming remain vital components of the video game market, with each segment comprising more than $31 billion in sales in 2016, according to Newzoo.
15. To date, Sony (SONY -0.34%) has dominated the console wars, with sales of its PlayStation 4 recently surpassing 53 million units worldwide. That's more than double the estimated 26 million Xbox One units Microsoft (MSFT -2.81%) has sold, and triple the 15 million Wii U units sold by Nintendo (NTDOY -1.18%), according to research company SuperData.
16. That's a valuable position for Sony -- and to a lesser extent, Microsoft -- to hold, as consoles are increasingly becoming an entertainment hub, with 50% of people who own game consoles using them to watch movies, 28% using them to listen to music, and 21% using consoles to consume live and other content, according to the ESA.
17. Notably, the growth in gaming appears to be coming at the expense of other forms of entertainment. In particular, gamers who are playing more video games than they did three years ago are spending less time playing board games (49% of gamers), watching TV (37%), and going to the movies (37%).
18. Virtual reality appears to have a bright future within gaming, as 58% of the most frequent gamers who are familiar with virtual reality intend to play games on VR, and 40% say they will likely purchase VR within the next year, according to the ESA.
19. An even more powerful growth driver for the gaming industry is the emergence of eSports. The global audience for eSports surged 36.6% to 323 million in 2016, and Newzoo projects that it will exceed 589 million worldwide by 2020.
20. Global revenue in the eSports industry rose an even more impressive 51.7%, to $493 million, in 2016 -- and is expected to approach $1.5 billion by 2020.
21. All told, Newzoo forecasts that the global video game market will exceed $118 billion in total revenue by 2019.
Investor takeaway
The growing attraction of gaming among people of nearly all ages and the surging popularity of eSports are propelling the already $100 billion video game industry to ever-rising heights.
While some are attempting to profit from this trend by buying stock in console makers such as Sony or Microsoft, investors may be best served by instead purchasing shares of the top video game makers, such as Activision Blizzard (ATVI) and Electronic Arts (EA -0.52%).
Activision makes some of the most popular eSports games, including Heroes of the Storm, Call of Duty, StarCraft, and WarCraft, while Electronic Arts is owner of two of the most popular sports-based eSports franchises in Madden and FIFA.
While console makers often struggle with razor-thin margins, video game makers are benefiting from the trend toward digital distribution, which is boosting margins and overall profits for both Electronic Arts and Activision.
Perhaps most importantly, Activision and EA are video game pure plays, while Microsoft and Sony are much more diversified businesses. As such, investments in Activision Blizzard and Electronic Arts are a direct way to profit from the growth of the global video game market -- a bet I expect will pay off handsomely in the years ahead.
