Australian video games ‘could be billion-dollar industry’ if given support: peak body
A lack of federal government support has left Australia with a stunted video game development industry, according to the national peak body, resulting in flagging overseas investment and an extremely small share of a global market now worth $250 billion.
New research shows income generated by Australian game studios in the 2019-2020 financial year totalled $184.6 million, or six cents for every dollar made by the industry globally. Ron Curry, CEO of Australia’s Interactive Games & Entertainment Association, said game developers compete in a global environment and that locals were at an unnecessary disadvantage.
“Every other developed nation in the world has government incentive packages in place for game developers. Everywhere except Australia,” he said.
In 2016 a Senate committee recommended both a refundable tax offset and direct funding for games be established, similar to the support given to other screen media. Since then similar recommendations have come from Austrade and the Small Business Ombudsman. But Mr Curry said the support hadn’t eventuated.
“We have a government that love film, they love TV, they love theatre. They just don’t seem to have this cultural connection to video games,” he said.
“When we do get to sit with them, when we do get to speak to them, they absolutely see the economics of it. I just think maybe they don’t see it as a serious industry.”
The global video games industry is worth more than ten times the global music industry.
Australia’s games industry is made up of dozens of smaller studios, concentrated primarily in Victoria. State governments do provide limited support and incentives, allowing for several acclaimed hits out of Australian studios in recent years including Untitled Goose Game, Florence, Hollow Knight and Golf Story. The new research, commissioned by the IGEA and conducted by Premium Research, found around 87 per cent of all Australian game revenue in the last financial year came from overseas players.
Revenue from Australian games was up 29 per cent year on year, but Mr Curry projects the local industry could be worth a billion dollars within ten years if given the level of support seen in other developed countries and in other screen media.
Incentives would make Australia a competitive place for big international studios to set up shop, as they did in the mid-2000s when the dollar was comparatively low, and having studios of various sizes would create an ecosystem that not only kept local developers from leaving the country but invited others in from around the world, Mr Curry said.
The cost of our studio, because we don’t have these incentives, is 30 to 40 per cent more.
Dylan Miklashek, head of the Brisbane arm of French mobile game company Gameloft, said no-risk government action like tax offsets would help put Australia on an even playing field with countries in Europe and the Americas, where new studios tend to be established.
“Our salaries and cost of living are similar to Montreal or Vancouver. But the cost of our studio, because we don’t have these incentives, is 30 to 40 per cent more,” he said.
“So when my head office is looking at the bottom line they go ‘Dylan, Brisbane is very expensive’. I think we’ve got a great team, we’ve got some real talent, but you can’t be 30 to 40 per cent better than a studio that’s in Montreal, which has that incredible ecosystem.”
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