Although the British video game market holding up at a value of £7.05 billion according to a UKIE reportconsole hardware and later software market values are falling.
Console hardware fell 27% to £832m, PC hardware fell 14% to £760m and console accessories fell 15% to £396m.
In total, the hardware market value fell 19% to a value of £2.16 billion.
Dorian Bloch, Senior Client Director at GfK, said: “Console hardware remained the largest gaming hardware sector, but saw the biggest decline in 2022, in part due to the natural progression and adoption of ninth-generation consoles, which opposes the decline of the previous generation.
Other factors included well-documented supply chain component issues, higher cost of raw materials due to shortages, and slower shipments to warehouses and ports, which affected all hardware sectors. , including video games.
“Much can still be attributed to the uncertainty of Covid, but the Russian-Ukrainian war, recession, inflation, rising cost of energy/food/living all play a part in the loss of consumer confidence, with consumers putting off major purchasing decisions – including of course gaming hardware.”
Reflecting this decline, the value of digital console sales fell 4.7% to £1.98 billion. Sales of boxed games also fell 4.3% to a value of £489m. Despite this decrease, 2022 is the first year in more than a decade that boxed video games have beaten digital copies in terms of annual performance.
Matt Bailey, principal analyst at Omdia, said: “The digital segment of the UK console market has been impacted by a further shift to pre-pandemic engagement levels, which has resulted in lower legacy software downloads and reduced console DLC spending.
A lack of hardware supply – especially for PS5 – has also prevented many would-be owners of ninth-gen consoles from redirecting their spending towards higher-value digital content.
And, while console subscription services remain a key area of growth, they are not yet generating the amount of spend needed to offset declines in other areas of digital console spending.
“Digital PC was relatively stable, supported by the microtransaction segment. The healthy start to Valve’s Steam Deck – which we estimate to have sold 135,000 units in the UK in 2022 – indicates there’s still appetite for spending in the PC market.
