SCOTLAND’s video games industry is dominated by small studios with the bulk of the development effort focused on the ultra-competitive mobile and tablet markets research has found.
A study by TIGA, the trade association for the industry, shows Scotland punches above its weight in the fast-growing video games business but highlights the challenges facing the sector.
TIGA found that Scotland had 97 companies working on games development at the end of 2014.
That gave the country 11 per cent of the total UK stock of around 870 firms, compared with an eight per cent share of the UK population.
Scotland is home to a disproportionate share of small businesses, which may not be able to draw on the kind of resources that bigger fish can access.
Some 91 per cent of the Scottish studios TIGA examined had 14 or fewer members of staff compared to 79 per cent of UK wide studios.
TIGA said around 56 per cent of Scottish studios are primarily focused on mobile and tablet gaming, against 48 per cent in the UK.
The focus on games for mobile phones and tablets may reflect the fact the budgets required to develop these are relatively modest and the teams smaller compared to those required to develop games for PCs and consoles, reckons TIGA.
Chief executive Richard Wilson, said Scotland has many exciting, growing and successful studios and games companies. He cited the likes of Rockstar, which developed the Grand Theft Auto series, and Kobojo, creator of the multiplayer Zodiac Orcanon Odyssey.
“The Scottish and UK video games industries provide high skilled jobs in an export focused sector,” said Mr Wilson. “Developing this successful industry is important not just for the games sector, but for the creative industries in general and for the UK and Scottish economies.”
TIGA found Scotland had 1,050 permanent and full-time equivalent creative staff working on games development at the end of 2014, representing 9.7 per cent of the UK total.
Mr Wilson noted there had been a surge in start-ups in Scotland focused on mobile and tablet games development.
However, he added: “The challenge now is to reduce the failure rate of games companies – 30 per cent of all UK games businesses have closed down over the last five years – and to encourage the growth of more durable studios with more staff that are capable of handling larger projects.”
TIGA said barriers to entry into mobile and tablet development are low and competition is correspondingly intense. It found 1,866,359 active apps on the App Store.
“It is difficult to succeed in this market without investment and publisher backing to ensure successful discoverability,” said TIGA.
Chris Stamp, director at Kobojo’s Dundee development studio said: “Even if a studio gets everything else right - funding, a great new IP, accomplished execution – without a way of getting their game noticed amongst the hundreds released every day they will still struggle.”
With headquarters in Paris, Kobojo raised $7m development funding In May from backers including the investment bank arm of Scottish Enterprise.
The development agency has highlighted the potential for Scotland’s video games sector to establish strong positions in overseas markets.
In its 2014 – 2017 business plan SE said it wanted to encourage start up companies to be ‘born global’, building on Scottish strengths in areas such as video games.
TIGA said official efforts to support the games industry should focus on improving access to finance, enhancing commercial skills such as marketing and public relations, exploiting export opportunities and developing regional games clusters.
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