TIGA responds to BFI/Creative PEC report on acquisitions of UK games studios by overseas companies

By November 9, 2023 TIGA News

TIGA, the trade association representing the UK video games industry, welcomed new research on the impact of overseas mergers and acquisitions on the UK video games development sector and called for further research into this important policy area.

The BFI and Creative Industries Policy and Evidence Centre (PEC) have published a new research report assessing the feasibility of measuring the impact of overseas mergers and acquisitions on the UK video games industry.

The research finds that the UK games development sector has been the focus of significant inward investment from global games publishers, with 118 acquisitions of UK games development companies by international companies between 1993 and 2022.

The research notes that the potential benefits and impacts of acquisitions include better access to capital and distribution for acquired firms, as well as loss of autonomy and IP. Potential market failures include falling innovation, overseas reallocation of production and IP, reduced profitability and loss of tax revenue to the UK Government.

TIGA welcomes the publication of the report and recommends that the BFI and Creative Industries PEC carryout further research to ascertain what the drivers of these acquisitions are and what the impact of  such acquisitions are on the UK games development sector.

TIGA’s Making Games in the UK 2023 report found that 51.9% of UK games development staff were employed by global companies and that overseas-owned games companies have been growing much faster than domestic games studios (25.3 per cent compared to 9.5 per cent on average over the last 3 years). TIGA also found that in the last 5 years, overseas-owned games studios contributed over £5.5 billion to the UK economy by employing over 12,400 creative staff, as well as tens of thousands in the wider supply chain.

Dr Richard Wilson OBE, CEO of TIGA, said: “This feasibility study is an important first step towards understanding the impact of studio acquisitions by overseas companies on the UK games eco-system. The sheer scale of the economic impact of internationally owned UK games studios on our economy shows how attractive the UK is for some of the world’s biggest games companies. These companies have been a major driver of our sector’s growth over the last decade.

“The sector now needs to know whether some of the potential market failures identified in this scoping report actually exist. Is the UK more of a seller than a buyer of games companies and if so, why? TIGA has been highlighting the finance gap facing our games companies which can stop some growing as fast as they might and makes them vulnerable to acquisition. We have quantified the potential impacts of the forthcoming Video Games Expenditure Credits, and proposed meaningful, costed policy measures to tackle the major challenges facing the sector, including a Video Games Investment Fund. Now that the feasibility of such a study has been established, we encourage the BFI and Creative Industries PEC to carry out further research in this important policy area”.

About TIGA

TIGA is the trade association for the UK video games industry.  TIGA’s vision is to make the UK the best place in the world to develop video games. To this end, TIGA:

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