EA’s Growth: Potential in Latin America and Asia’s Gaming Markets



Console is yet to penetrate Latin America and developing markets

In this series, we’ve already discuss Brazil and Latin America’s significant position in gaming. The Brazilian gaming space is dominated by digital platforms—mobile, social networks, PC downloads, and free-to-play MMOs (massively multiplayer online).

As the following chart shows, consoles and console games aren’t significant in the larger picture. According to a report by SuperData Research, digital distribution is expected to make PCs more appealing. Electronic Arts (EA) will be able to deliver games with little incremental costs to markets—especially developing markets like Brazil, Russia, and China. In these markets, console penetration hasn’t matched their developed counterparts yet.

Microsoft’s (MSFT) Xbox One and Sony’s (SNE) PlayStation are the dominant players in the console space.

You can consider investing in the PowerShares QQQ Trust (QQQ) and the Technology Select SPDR (XLK) to gain exposure to EA. It accounts for about 0.35% and 0.47% of these ETFs, respectively.

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Huge growth in the Internet user base

According to a report by S&P Capital, more than 1 billion new internet users are expected to be online from 2013 to 2018. The total number of internet users will climb from 2.5 billion to 3.9 billion. China and India are expected to account for 300 million and 313 million users, respectively.

The majority of this growth is expected to come from increased broadband penetration in China and increased wireless penetration in India. Monetizing these new consumers and markets poses a huge opportunity for EA to realize its growth prospects.

To learn more about Asia’s gaming markets, read A lucrative sector: Why you should look to Asia’s gaming markets.


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