Online Games - Japan

Japan

Highlights

In Japan, revenue in the Online Games market market is projected to reach US$3.96bn in 2024.
Revenue is expected to show an annual growth rate (CAGR 2024-2029) of 3.58%, resulting in a projected market volume of US$4.72bn by 2029.
In the Online Games market market withJapan, the number of users is expected to amount to 29.1m users by 2029.
User penetration in Japan will be 23.1% in 2024 and is expected to hit 24.4% by 2029.
In global comparison, most revenue will be generated China (US$6.53bn in 2024).
The average revenue per user (ARPU) in the Online Games market market in Japan is projected to amount to US$140.00 in 2024.
Japan's online gaming market continues to thrive, driven by a growing demand for immersive experiences and innovative storytelling in digital entertainment.

Key regions:

Market definitionIn-Scope/Out-of-scopeMarket structureReportsMethodology

The Online Games market in Japan has been experiencing significant growth in recent years, driven by changing customer preferences and local special circumstances.

Customer preferences: Japanese consumers have shown a strong preference for online games, with a growing number of people engaging in gaming activities. This can be attributed to several factors, including the increasing popularity of mobile gaming and the convenience it offers. Mobile games have become a preferred choice for many Japanese consumers due to their accessibility and the ability to play anytime, anywhere. Additionally, the social aspect of online gaming has also contributed to its popularity, as players can connect and interact with friends and other gamers in virtual communities.

Trends in the market: One of the key trends in the Japanese online games market is the rise of in-game purchases and microtransactions. Players are increasingly willing to spend money on virtual items, such as cosmetic upgrades or in-game currency, to enhance their gaming experience. This trend has been fueled by the success of free-to-play games, which offer a basic gaming experience for free but monetize through in-app purchases. As a result, game developers are focusing on creating engaging and immersive experiences that encourage players to spend money within the game. Another trend in the market is the increasing popularity of esports in Japan. Esports refers to competitive video gaming, where professional players compete against each other in organized tournaments. Esports has gained a significant following in Japan, with dedicated esports arenas and a growing number of professional teams and players. This trend has led to increased investment in esports infrastructure and the development of esports-focused games, further driving the growth of the online games market.

Local special circumstances: Japan has a rich gaming culture and a long history of producing successful video game franchises. This has created a strong domestic market for online games, with Japanese consumers being highly engaged and enthusiastic about gaming. The popularity of Japanese game developers and their ability to create unique and innovative gaming experiences have contributed to the growth of the online games market in the country. Furthermore, Japan has a well-developed internet infrastructure and high smartphone penetration, which has facilitated the growth of mobile gaming. The widespread availability of high-speed internet and the increasing affordability of smartphones have made online gaming accessible to a larger population, driving the expansion of the market.

Underlying macroeconomic factors: The Japanese economy has been relatively stable in recent years, with steady economic growth and low unemployment rates. This has provided consumers with the disposable income and the confidence to spend on leisure activities, including online gaming. Additionally, the aging population in Japan has also contributed to the growth of the online games market. Older adults are increasingly turning to online games as a form of entertainment and social interaction, further expanding the customer base. In conclusion, the Online Games market in Japan is experiencing significant growth due to changing customer preferences, such as the popularity of mobile gaming and the rise of in-game purchases. The local special circumstances, including Japan's gaming culture and well-developed internet infrastructure, have also played a role in driving the market. Furthermore, the stable macroeconomic conditions in Japan have provided consumers with the means to engage in online gaming.

Data coverage:

The data encompasses B2C enterprises. Figures are based on the Video Games market. Digital video games are defined as fee-based video games distributed over the internet. These include online games, download games, mobile games, and gaming networks. All monetary figures refer to consumer spending on digital goods or subscriptions in the respective market. This spending factors in discounts, margins, and taxes.

Modeling approach / market size:

The market size is determined through a bottom-up approach. We use annual financial reports of the market-leading companies and industry associations, third-party studies and reports, survey results from our primary research (e.g., Consumer Insights), as well as performance factors (e.g., user penetration, price per product, usage) to analyze the markets. To estimate the market size for each country individually, we use relevant key market indicators and data from country-specific industry associations, such as various macroeconomic indicators, historical developments, current trends, and reported performance indicators of key market players. In particular, we consider average prices and annual purchase frequencies.

Forecasts:

We apply a variety of forecasting techniques, depending on the behavior of the relevant market. For instance, the S-curve function and exponential trend smoothing are well suited for forecasting digital products and services due to the non-linear growth of technology adoption. The main drivers are GDP per capita, consumer spending per capita, and 4G coverage.

Additional notes:

The data is modeled using current exchange rates. The market is updated twice a year in case market dynamics change. The impact of the COVID-19 pandemic is considered at a country-specific level. The data is modeled using current exchange rates. The impact of the COVID-19 pandemic and the Russia-Ukraine war are considered at a country-specific level. The market is updated twice a year. In some cases, the data is updated on an ad hoc basis (e.g., when new, relevant data has been released or significant changes within the market have an impact on the projected development). Consumer Insights data is reweighted for representativeness.