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Tuesday, 20. November 2018  


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Time to Play

Time to Play

http://www.nesta.org.uk/assets/Uploads/pdf/Research-Report/Time_to_Play_report.pdf

Games Investor Consulting (GIC) has been contracted by NESTA to survey 30 leading British video games developers, publishers and investors.

The aim of this survey, following the call for evidence in Digital Britain, is to produce robust evidence for policymaking in support of the activities of the UK video games studio sector, particularly in regards to the potential impact of a tax credit for culturally British games.

Key findings

The results of the survey portray the UK video games sector as a world-class creative industry under increasing pressure. The availability of government subsidies overseas is making the UK less and less competitive as a video games development territory, not only from the point of view of costs, but also of skills. Strong government support in competitor countries (particularly Canada) is helping  studios located there to attract key senior staff from the UK, in a 'brain drain' which is intensifying skill shortages and threatening the quality of the UK's output.

Nearly three quarters of respondents claim that original Intellectual Property (IP) development has slowed or stopped in the last 5 years, and more than half think that this the trend will continue in the future, with the potential exception of emerging networked gaming platforms. Risk aversion by publishers is making it harder for UK developers to be creative and innovative, areas where they have excelled in the past.

Almost all respondents believe that, if introduced, a tax credit for cultural games would have a positive impact on the sector, by helping to 'level the international playing field', and making it easier for UK studios to retain their talent. They also report potentially beneficial effects on staff growth and levels of investment in video game development in the UK.

The majority of developers surveyed claim that the tax credit would also have a positive impact on their capacity to generate original IP, and to retain ownership over it. They are unanimous in stating that the tax credit for cultural games would encourage them to adopt innovative business models using digital distribution, a rapidly growing area where the UK sector is lagging behind competitors in the USA, the Nordic countries, South Korea and Germany.

Most external finance sources surveyed consider the UK video games sector to be an unattractive prospect for investment at the moment. The reasons for this are lack of scale, and an excessive emphasis on traditional, high-risk retail business models instead of network gaming and direct-to-consumer propositions. Respondents in this category are unanimously positive about the impact of a tax credit on the scale and/or number of investments in UK video games projects. Half of them would change their attitude towards investing in UK video games companies if the tax credit for cultural games was introduced.

 

 

 

 



 

 


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