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TIGA: UK has seen more start-ups than closures

Study of 278 studios also finds massive shift to network gaming but a drop in staff numbers

A study of the British games industry conducted by TIGA has discovered that more game-related companies have opened since 2008 than have closed, but staff numbers overall are down by nine per cent.

The census found that there had been 145 start-ups or market entrants since 2008, but also 131 closures, 84 per cent of which were game development studios.

Over 80 per cent of the new development companies founded in those two years have been focused on delivering network games rather than traditional physical media.

"Over the last two years 145 new companies entered the market, 80 per cent of which focus on digital distribution gaming. This illustrates the highly competitive and entrepreneurial spirit of the UK games sector, as well as its agility and ability to adapt to new market conditions," offered TIGA chairman Richard Wilson.

"In recent years, a range of new platforms and business models have given games companies more flexibility. Driven firstly by the rapid growth of the iPhone games market and then more recently and most significantly by Facebook and the social network games market.

"Games studios in this space often have a higher potential to be stable and profitable, better able to raise finance, create original new games, retain copyright and attain greater financial stability. Network gaming grew in 2009 to represent 38 per cent of the global video games market. Today, the largest games audiences and fastest growing games companies the industry has ever seen are in network gaming, particularly on Facebook," he continued.

"TIGA is focused on supporting these new companies. We will disseminate best practice information and advice to new start-ups and to developers moving towards self-publishing. We will work with Jagex on Project Ignite to help developers to publish their games.

There are now 9010 people working in the UK games industry, down from 9900 in 2008, and there is strong evidence that many of these employees have moved on to other countries - particularly Canada, said TIGA. Over the same period, the census found that the Canadian industry's headcount has risen by 33 per cent, driven partly by hugely beneficial tax breaks and a migrant workforce.

A separate TIGA study in 2009 revealed that, of the 23 per cent of UK studios which said they had lost staff to overseas companies, 72 per cent said that they had moved to Canada.

Wilson, however, is resolute that a similar culture and success can be encouraged in the UK with the right political lobbying.

"TIGA will also continue to lobby the government to create a more favourable environment for the games industry. This means the introduction of Games Tax Relief, enhanced R&D tax credits, action on skills and the maintenance of a flexible migration policy so that the best and brightest people can work in the UK games industry," Wilson concluded.

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Dan Pearson