SCi plans to open a studio in Montreal, with up to 40 per cent of its staff salaries subsidised by the government. The state government of Victoria in Australia is also looking at similar incentives, such as providing £156,000 over two years to help fund local games development.
"The UK still has a good talent base, but other places are making a concerted effort to draw talent," said Cavanagh.
Trade body Tiga says that the number of independents in the UK has fallen, down from 400 in 2001 to 150 today. UK Trade and Investment is investigating this matter, with a report due later this year.
"The UK has a fabulous track record for creating genre-defining games and it would be very easy to rest on our laurels and say look at Lara Croft and Grand Theft Auto," said Rick Gibson, an independent games analyst at Games Investor Consulting, who is working on the report.
"But the market for games development is getting increasingly competitive, with the advent of major government intervention in places like Quebec and Victoria."