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The Growing Video Game Market in Africa
Sub-Saharan Africa's Emerging Gaming Industry
Data from Dutch research firm Newzoo, compiled for African gaming startup Carry1st, reveals that Sub-Saharan Africa's gaming industry is expected to generate over $1 billion for the first time in 2024. This suggests a buoyant market for gaming in Africa, despite the region's sluggish economic growth. In 2022, games sold in the region generated $862.8 million in revenue, up 8.7% year over year, according to Newzoo's data.
Africa's Gaming Industry vs. Global Trends
Africa's video game market has shown resilience in the face of a global contraction in video game activity. The global games market generated $182.9 billion of revenue in 2022, down 5.1% from 2021, according to Newzoo. Cordel Robbin-Coker, CEO of Carry1st, attributes the growth of Africa's gaming industry to its underlying secular growth and the fast-growing population in the region.
Growth Factors: Population, Internet Penetration, and Smartphone Adoption
Africa's gaming prospects have been boosted by the adoption of smartphones, falling smartphone prices, and the region's younger population. By 2030, it is estimated that 87% of the population in Sub-Saharan Africa will own a smartphone, up from 51% in 2022. Venture capital firm Konvoy predicts that Africa's gaming industry will grow 15.7% in 2023 and 13.6% the following year, higher than previous projections.
Revenue Leaders and Growth Potential
Nigeria and South Africa currently lead in total annual gaming revenue, with Nigeria attracting $249 million and South Africa generating $236 million in revenue. However, all 10 of the top countries in Africa's gaming market experienced year-over-year sales growth. Ethiopia recorded the highest growth rate at 13%, while Uganda had the slowest growth at 6%. Overall, Africa's gaming industry is poised for incredible growth in the coming years.
Conclusion: Seizing the Opportunity in Africa's Gaming Industry
The growing video game market in Africa presents a lucrative opportunity for new businesses looking to tap into an emerging industry. With Sub-Saharan Africa's gaming industry projected to surpass $1 billion in revenue by 2024, despite the region's economic challenges, it is clear that there is a buoyant market for gaming in Africa.
Africa's gaming industry has displayed resilience in contrast to the global trends, where the overall video game market experienced a contraction in revenue. The underlying secular growth of the industry, coupled with the region's fast-growing population, contributes to its success. As smartphones become increasingly accessible and affordable, with an estimated 87% of Sub-Saharan Africa's population projected to own a smartphone by 2030, the prospects for the gaming market continue to improve.
While Nigeria and South Africa currently lead in gaming revenue, all the top 10 countries in Africa's gaming market have experienced year-over-year sales growth, indicating the potential for expansion across the region. Notably, Ethiopia's impressive growth rate of 13% underscores the untapped potential in African markets beyond the established leaders.
For new businesses entering the African gaming market, it is crucial to consider the unique characteristics and preferences of the local population. Developing culturally relevant content, localizing games, and partnering with local influencers and distributors can help to establish a strong presence in the region.
In conclusion, the growing video game market in Africa presents an exciting opportunity for new businesses. With favorable market conditions, increasing smartphone penetration, and a young population, the potential for growth in Africa's gaming industry is significant. By embracing this emerging market and focusing on tailored strategies, businesses can position themselves at the forefront of Africa's gaming revolution.Article First Published at: https://www.cnbc.com/2023/07/14/africas-gaming-market-is-expected-to-top-1-billion-in-2024-data.html