Magdalena Tanev

Gaming is booming in Latin America (LATAM). While already popular prior to the pandemic, social distancing guidelines and stay-at-home orders meant that gaming surged over 2020, with monthly gaming expenditure in Mexico, Brazil, and Chile growing at an average of 50%. The mobile gaming market in particular is expanding fast, generating  $3.5 billion in revenues via customer spending in 2021, according to Newzoo’s Global Games Market Report. And  this will only continue: the mobile gaming sector is expected to grow at a CAGR of 10.5% during the period 2021-2026. 

While LATAM may have been overlooked in the past by game developers who had their sights set on North American, European, and Asian markets, that’s set to change. The gaming scene in LATAM offers developers huge opportunities for engagement and growth, without the heavy price tag that comes with investing in media in other regions.

Let’s explore why LATAM is ripe for gaming growth.

Increasing smartphone and internet access in LATAM

One of the principal reasons for recent gaming successes in LATAM is the rapid expansion of internet access across the region, as well as increasing smartphone penetration. 

The number of mobile internet users in LATAM is expected to grow to 424 million by 2025, up from 343 million in 2019. Meanwhile, the smartphone penetration rate is estimated to increase to 79%, and reach 351.9 million users by the end of 2021.

According to research from Americas Market Intelligence, LATAM users spend an average of 7.5 hours online each day, compared to five hours in the rest of the world. They’re also doing more online: the average Latin American performs 16.3 different activities online each week, compared to 12.9 globally.

The more people are online — and using their smartphones for internet access — the more opportunities arise for gaming apps to reach new audiences. In fact, mobile accounts for 48% of gaming revenues in 2021 and 58% of the region’s population play mobile games, according to Newzoo’s report.

Looking ahead, as 5G implementation expands throughout the region, there will be increasing chances for new games and apps to capitalize on the trend. With the spread of 5G over the next five years, we can expect to see a demand for higher quality games with minimal latency and better multiplayer and esports experiences.

The size and relative simplicity of LATAM

LATAM is not only a huge market, but it is also more homogenous — and thus easier to market to — than regions like Europe or Asia where game developers have to contend with linguistic complexity and starkly different cultures.

While each country in LATAM is, of course, distinct and has its own practices, trends, and preferences, any gaming app looking to launch in the region only has to consider two languages  — Spanish, which is spoken by over 400 million people, or Portuguese, which is spoken by over 200 million people in Brazil. This makes for easier marketing and advertising, and also means that communities of gamers form more easily across the region as they connect with others that speak their own language and understand their culture.

Easily LATAM’s largest gaming market in terms of mobile gamers and revenue generated, Brazil’s mobile game market is expected to generate over $1 billion in 2021, with an astounding 88.4 million players. Smaller markets like Colombia and Chile are expected to grow too, with more potential for less popular or independent gaming apps to enter the market and reach new audiences.

Wide genre appeal in LATAM

One important factor contributing to the potential of LATAM’s gaming market is the range of preferences of gamers in the region, with strategy games and esports coming up top.

Newzoo’s Global Games Market Report found that 35% of LATAM’s gamers had played a strategy game in the six months prior, followed by shooter (32%) and racing (30%). The same report found that sci-fi and fantasy themes came up top, though preferences differ from country to country.

Esports are also hot in LATAM, with Newzoo’s “Global ESports & Live Streaming Market Report” showing that Portuguese- and Spanish-language streams have the fastest-growing viewership on streaming platform Twitch.

The number of esports spectators is expected to hit 70 million in 2022, up from an estimation of 55 million in 2020, with the region’s esports industry estimated to generate revenues of $47.5 million this year, according to Newzoo. In fact, the esports industry is so popular in LATAM that Ciudad de México is home to the Arena eSports Stadium, a 300 square meter event center specifically dedicated to playing and watching esports.

The barrier to entry for esports is especially low as it’s possible for LATAM gamers to spectate and play from their smartphones, with many young people unable to afford PCs and consoles to play on. Games like “Counter Strike,” “Call of Duty,” “Dota 2,” and “League of Legends” are enjoying particular success across the region. Events such as Argentina Game Show, SP Gaming Tournament Chile, and eSports México provide opportunities for gamer communities to come together and connect over eSports. The wider esports sector is even building partnerships with local LATAM music artists and influencers, such as XSET’s recent partnership with Puerto Rican singer Ozuna.

Looking to the future, we can expect to see innovative trends such as virtual reality and augmented reality enter the market as current high costs come down. As it stands, mobile gaming has a firm stake in the ground in LATAM due to expanding smartphone and mobile internet access, and the convenience it provides to the region’s gamers. As gaming technologies and high-speed connectivity expand, the grip of mobile gaming will remain firm for users across LATAM.