In October 1958, Physicist William Higinbotham released Pong – the simple tennis game thought to be the first ever video game – and things have never been the same.
Since then, video games have gained popularity at breakneck speed, with the industry expected to reach $7.3 billion in revenue by 2026 in Australia alone.
In fact, spending on video games takes up a large portion of Australian household budgets.
According to a new PwC report, Aussies spent more on entertainment, media and internet access services in 2021 than ever before.
“Supercharged by subscription services and gaming, and boosted by the return of in-person entertainment, by the end of 2022, each household will be spending $510 more per year than in 2019 before the pandemic hit,” the report said.
The PwC report found that by the end of the year, Aussie households would spend more than $4,500 on average annually on entertainment and media.
Another report from Newzoo, a gaming market research house, also predicted that the size of the global games market was expected to increase to $219 billion in 2024, up from US$176 billion in 2021.
But there is more to the sector than just entertainment – and many Aussies are using their love of video games as a means to make a profit.
There is an old investor adage that says you should invest in what you know so, if you are a video game buff then why not invest in the thing you love?
With all the different video game and console companies out there, who better to know what’s expected to come out and how excited the market is for it than someone who is part of the scene?
How to invest in video games
The BetaShares Video Games and Esports ETF (ASX: GAME) exposes investors to a portfolio of video games and esports companies.
“It’s our view that the video gaming and esports sector is a long-term thematic play that is anticipated to have decades of growth ahead,” Betashares director – adviser business Blair Modica told Yahoo Finance.
“A number of recent reports have shown that the long-term outlook for video gaming and esports is very strong.”
There are also a number of global companies seeking to expand their presence in the gaming industry.
“In recent months, global names such as Microsoft, Sony and TakeTwo Interactive have all upped their exposure to the sector as more people use video games to stay connected with their friends and keep themselves entertained,” Modica said.
Using investing platforms, like eToro and Robinhood, Aussie investors can put their money into any number of international companies involved in video games.