Scottish Video Games Industry at a Crossroads

September 10th 2010

TIGA, the trade association representing the UK games industry, said today that the Scottish video games industry was at a cross roads. If Games Tax Relief was introduced the sector could expect to grow. If the UK Coalition Government sat on its hands and did nothing, investment and employment in the sector could decline. TIGA made the comments on the day that it published new data on the Scottish video games sector, showing that employment in the development sector had fallen by 18 per cent during 2010, driven by the fall of Realtime Worlds.

TIGA’s research shows that Scotland has 46 games development businesses, providing highly skilled employment for 650 people. Scottish games businesses invest over£30 million per annum and contribute£67 million to UK GDP. Scottish development studios typically employ highly qualified people and sell their games all over the world. For example, Firebrand Games in Glasgow generates 100 per cent of its turnover by exporting video games and the majority of their staff are graduates.

TIGA’s research shows that Games Tax Relief could secure for Scotland a net 273 jobs,£37 million in investment and generate£33.7 million in tax revenues over five years. Games Tax Relief would enable companies to take more risks and create more new and original titles.

Dr Richard Wilson, TIGA CEO, said:

“The Scottish video games industry is export oriented, R&D focussed and provides high skilled employment– this is exactly the kind of sector that we need to invest in as part of a process to rebalance the UK economy. TIGA’s new research shows that the Scottish games industry contributes almost£67 million to UK Gross Domestic Product, employs 650 highly skilled developers in 46 games development businesses. This is a critically important digital industry which, with the right Government support, can be world beating.”

Previous TIGA research shows that if Games Tax Relief was implemented, it could create or save 3,550 graduate levels jobs and secure£457 million in new and saved development expenditure and generate£415 million in new and saved tax receipts.

Colin Anderson, TIGA board member and MD at Denki in Dundee, said:

“The video game industry has been at the forefront of digital technologies and post-industrial business methods in Scotland and the UK as a whole for around two decades. In that time it has taught an entire generation of workers the skills our economy will be founded on in future.

“However, now the Scottish and UK video games industries are at a competitive disadvantage. Many of our competitors have tax breaks for games production. We do not. TIGA’s Games Tax Relief would give an incentive for investors to place projects and studios in Scotland and the UK. This would increase the chances of successful projects being developed in that area, which then kick-starts a natural process of talent moving in to the area to work with the teams responsible for delivering successful projects. Over time this becomes a self-stoking cycle.

“By abolishing Games Tax Relief the video games industry in Scotland will find it harder than other areas to attract the talent and investment it requires to self-sustain commercial success. This will become more problematic as other more aggressive territories realise the potential of digital media and offer progressively more lucrative advantages to companies looking to base themselves in a particular area. The UK Coalition Government must look again at the case for Games Tax Relief.”

Ends

Notes to editors:

About TIGA:

TIGA is the trade association representing the UK’s games industry. The majority of our members are either independent games developers or in-house publisher owned developers. We also have games publishers, outsourcing companies, technology businesses and universities amongst our membership. TIGA was awarded‘Trade Association of the Year’ and the‘Member Recruitment Award’ at the Trade Association Forum Best Practice Awards 2010.

TIGA's vision is to make the UK the best place in the world to do games business. We focus on three sets of activities: political representation, generating media coverage and developing services that enhance the competitiveness of our members. This means that TIGA members are effectively represented in the corridors of power, their voice is heard in the media and they receive benefits that make a material difference to their businesses, including a reduction in costs and improved commercial opportunities.

For further information, please contact Eva Field, TIGA PR Manager on: 07814 039 983, or email eva@tiga.org.


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