Evidence highlights the importance of video games exports
The importance of the internet industry as a contributor to the UK’s Gross Domestic Product has been highlighted in an article published in the Financial Times (October 28th). Research carried out by the Boston Consulting Group, who were commissioned by Google, found that ‘domestic online shopping, broadband access and net exports of digital goods and services made up 7.2 per cent of UK GDP’ . Video game developers are important exporters of digital content. Mind Candy, creators of the ‘Moshi Monsters’ online game, is played by almost 30 million children in 150 countries.
Commenting on today’s article, Dr Richard Wilson, TIGA CEO, said:
“These findings demonstrate once again the valuable contribution the video games industry makes to the UK export market. TIGA’s research shows that over 90 per cent of UK games developers export their products (games), compared to just one third of small and medium-sized enterprises generally. Additionally, on average, 62 per cent of a developers’ turnover is generated from the export of games. Firebrand Games in Glasgow generates 100 per cent of its turnover through the export of games, while Leamington Spa based developer, Blitz Games Studios earns 90 per cent of its income through exporting games, mainly to the USA.
“We need to continue to promote export oriented, high skilled, knowledge based business sectors of the economy, such as the video games industry. At present, some of our key competitors, including Canada and some states in the USA, have a cost advantage against UK developers because their governments provide them with tax breaks for games production. The UK Government should introduce Games Tax Relief to enable the UK games industry to compete on a level playing field in world markets. Measures such as Games Tax Relief and enhanced Research and Development tax credits would strengthen the competitiveness of the video games industry.””
Jason Kingsley, TIGA Chairman and CEO and Creative Director of Rebellion, said:
“The UK video games development sector’s contribution to the UK economy is often overlooked by policy makers, particularly in respect of exports. My own business, Rebellion, currently generates about 90 per cent of its turnover through exports. Just as the Coalition Government provides sector specific tax break to the film industry, so it should help our industry achieve its export potential through the introduction of Games Tax Relief.””
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