LogInMore than 400 IPs, $800 million in investment, and 3,000 creative tech graduates per year – that's what Malaysia's digital content sector has achieved so far. Let's explore how it's evolving.
Malaysia is quickly becoming one of Southeast Asia's most promising hubs for game development thanks to strong government support and an actively growing community. In this case study, 80 Level Research Team explores how Malaysia is building its game industry, what government initiatives it provides, how it grows local talent, and what its future plans are.
The Rise of The Malaysian Gaming Scene
Malaysia is currently ranked as the 36th largest economy in the world and is recognized for its business competitiveness and innovation. Its gaming market is expected to hit USD 1.43 billion in revenue by the end of 2025, and then reach USD 1.93 billion by 2030 with an annual growth rate (CAGR 2025-2030) of 6.21%.
Mobile gaming dominates the landscape, attracting 21.2 million players. In comparison, PC and console games cover only 3 million and 2.1 million players, respectively.
The younger generation is also one of the drivers of the gaming industry development. While the overall gaming penetration rate is 85%, among young people aged 16-20, it hits a full 100%. Millennials and Gen Z also play more across all gaming platforms compared to older generations.
Nirman Kamal Bin Juhanis, Marketing Manager at Todak Academy
Interest in gaming careers, especially among Gen Z and millennials, along with the rise of esports, is fueling this trend. Popular games like Mobile Legends have also helped bring more attention to the industry.
The industry's success is also driven by the Malaysian government's efforts to develop creative digital content. According to MDEC, this sector has attracted $800 million in both foreign and domestic direct investment over the past decade. Today, the digital content industry generates USD 1.5 billion in annual revenue.
Government Support: Malaysia as a Regional Gaming Hub
The Malaysia Digital Economy Corporation (MDEC) is leading digital economy transformation through initiatives that drive digital adoption, talent development, and technology investment across all sectors.
Amir Azlan Sapuan, Head of Games/Interactive Media, Digital Content Development at MDEC
MDEC's main role is to grow and develop the digital economy space in Malaysia. So, currently, under the Malaysia Digital Initiative, or MD, we look into 9 Malaysia digital focus areas, including digital cities, digital agri tech, digital finance, and digital tourism. We also look into digital content, which covers video games, animation, and creative tech. The government recognizes the value of digital content and is committed to supporting its growth, given its strong contribution to the national economy.
MDEC supports the growth of Malaysia's digital economy through six key areas:
- Offering tax incentives and business support;
- Providing grants and funding opportunities;
- Supporting studios and individuals;
- Enabling market access and talent development;
- Facilitating foreign tech talent;
- Advancing regulatory frameworks in related areas (AI, data centers, cybersecurity, quantum computing).
One of the government's key moves has been to treat games, animation, and creative tech as vital parts of Malaysia’s broader IT sector. Digital Content Fund reflects this commitment, with RM163 million (USD 37.5 million) allocated to support digital content. As a result, more than 700 jobs have been created under this initiative, showing how Malaysia is steadily strengthening its IT ecosystem via a multifaceted approach.
One of our interviewees from Weyrdworks shared that DCG has helped his company ease financial pressure. Based on his opinion, such support not only improves stability for indie studios but also creates room to focus on development and long-term growth.
Junn Tseng Yean, Art Director and Co-Founder of Weyrdworks
When you're involved in grant programs, the government sometimes organizes talks to improve awareness about IP. We did go through the IP process, especially for our earlier games. They explained the difference between trademarks and copyrights, what we can do, and how to go about it. That really helped us.
Now, the system has been updated, and everything is done online. I'm still trying to catch up with that, since the whole process has changed. So that's the only challenge at the moment.
It's also worth noting that the country pays special attention to IP support. For example, the Malaysia Digital Tax Incentives program offers a tax rate of 0% on qualifying IP income for 10 years. To further strengthen this effort, the government provides training programs to help familiarize companies with the fundamentals of IP protection.
Individuals can also receive support through scholarship programs, training, and special government-backed initiatives. For instance, MDEC runs Tech Talent Development programs to help people build digital skills and careers. These are designed for different groups, from school students to professionals.
Strategic Opportunities And Future Vision
Malaysia has a unique approach to supporting the gaming industry: it's driven from the top down. While most neighboring countries rely more on grassroots and community-driven initiatives, the government plays a central role in Malaysia, planning long-term strategies and allocating resources to the gaming sector.
The country operates on a five-year development cycle, and 2025 marks the beginning of preparation for the new one. It's building long-term impact through four key areas: industry development, incubation/acceleration, business development, and global market access.
Amir Azlan Sapuan, Head of Games/Interactive Media, Digital Content Development at MDEC
The government operates on a five-year budget development cycle. This year is more about reporting to the government on our achievements and our plan for the next five years. We have four core focuses in our plan. For incubation/acceleration, we want to have a long-term program to ensure that our studios are sustainable. This year, we are doing a trial phase to see who we can work with in the future.
We need to support the indie community to ensure we build a new funnel of game studios in Malaysia. This includes supporting programs like Game Jam, Portfolio reviews, and Women in Games. We want to make sure that we look at it holistically as well. The next direction is to grow the industry. The Government can only fund to a certain level, so if studios are looking for the next stage of funding, they need to talk to VCs and private investors. That's something we've already started talking about and looking at how we can attract more players in that space.
Malaysia is building more than just a local games industry. It's actively getting ready to compete on the global stage. With strong government support, clear plans, and a growing community of talented game developers, the country is building an ecosystem where studios can thrive and succeed. And new plans show the next big step in scaling the Malaysian gaming industry.
Want to get more insights on the game market in Malaysia? Read our new report Malaysia's Journey to Global Game Success absolutely for FREE.