Australian Video Game Industry Peak Body Calls on Federal Government to Commit to Supporting the Interactive Entertainment Industry

"The Game Developers Association of Australia (GDAA) calls on the Federal Government to commit to extending to the video game industry the 40% rebate which was recently granted to the film industry " said Tom Crago, President and Greg Bondar CEO of the of the Game Developers Association of Australia (GDAA).

The video games industry in Australia is experiencing a serious fiscal inequity and imbalance compared to the film and special effects industry sector of the entertainment industry. The government is guilty of a serious neglect of one of the fastest growing industry in the creative and entertainment sector.

The video game industry in Australia is in a unique position to attract much of the current AUD$30 billion international industry and all that is required are sensible tax concessions for international investors - exactly what the exceedingly well looked after film industry receives.

By 2011, the worldwide gaming market will be worth $48.9 billion at a compound annual growth rate of 9.1% during the five-year period with the Asia Pacific region remaining the region with the highest overall spending on gaming during the period and reach $18.8 billion

in 2011, according to a PwC forecast. See

( http://biz.gamedaily.com/industry/feature/?id=16589)

It is now critical that the Federal Government starts to recognise the economic contribution of the video game industry in Australia through its domestic sales of over $400m, export growth of over $100m, employment of over 2,000 young Australians (average age of game developers is 28).

"The Federal Government could do much to learn from the Canadian government which has created over 10,000 jobs in video game development over the last four (4) years though the right financial incentives" added Tom Crago and Greg Bondar.

We estimate that at present there are 8,500 people directly employed in the video game industry in Australia. (This is broken down as follows: Development: 2000. Publishing and Distribution: 1500. Retail & Sales: 5000.) With the production rebate extended to the game development industry we envisage that, skills shortages not withstanding, the number of people employed in game development in Australia could triple to 6000 within three years. We would also expect to see growth in the other areas of the industry.

It is not unrealistic to think that by the end of 2010 we could have 18,000 people directly employed in the video game industry in this country.

The GDAA now calls on the Federal Government to immediately review its commitment to the Interactive Entertainment (video game) industry by also extending the 40% film rebate to the video game industry.

Further details:

Tom Crago - President GDAA - 0416 170 153

Greg Bondar - CEO GDAA - 0411 854 115

Media wishing to attend the Press Launch to contact Sarah on 0406 691 944

ATTACHED SUPPORT DOCUMENTATION:

Economic, Cultural and Social Benefits - The Facts

Total sales in 2006 of $1billion *GFK

Annual Compound Growth 12.3% *PWC

12.5m games sold in 2006 *GFK

6.1m video game consoles sold since 2000 *GFK

3.6 million Households have a video game console

4.8 million Households have an internet enabled pc capable of playing games *ABS

Average age of gamers 28 years

60% are male & 40% female

35% are parents & 8% are seniors

Families are an integral part of playing games

Australians spend over $A2 million per day on interactive computer games

8,500 Australian directly employed in the video game industry 2007

By 2010 we estimate 18,000 directly employed in the video game industry in Australia

Support Material:

The Industry That Wasn't There

Despite gaining some promising recent traction in the media on the issue of the need for the Federal Government to provide a more attractive investment environment for the local video game development industry, the industry has been overlooked in this week's Federal Budget. There has been no big bang investment initiative, let alone any industry specific funding, or even just a token mention of the game industry.

This is not an issue of whether the industry, in this case the game development segment, is politically adept enough to have its message heard. This really appears to be a more basic issue of existence.

Does the Federal Government really accept that a video game making industry should exist in Australia?

The current Federal Government has had at least five years to come to grips with the fact that a video game industry exists locally. In 2002 the Department of Communications Information and Technology started releasing reports under the guise of the Creative Industries Cluster Study, which aimed "to devise policy strategies that help the digital content and applications industries to achieve commercial outcomes in domestic and international markets" focusing "on the capabilities of those industries and identifying the key capabilities that are required." The Cluster Study specifically recognized games as a core creative industry.

The Cluster Study led to the Digital Content Industry Action Agenda started in 2004, which culminated in a report released March 2006, titled Unlocking the Potential, which fully recognizes online games, Internet based publishing of games, and games. This report "identified six key issues that need to be addressed in order to make the most of the opportunity offered to Australia by the Digital Content Industry at this critical stage in its evolution."

The report describes the need for the digital content industry "to raise investors' awareness about the industry and to examine ways to make the industry more attractive to investors" as the most significant issue.

The third key issue is an acknowledgement that "historically, Government has developed a range of regulatory and industry support mechanisms to foster the development of older, more established content production and distribution industries, particularly in film, television, radio and publishing" and that these mechanisms "are faced with greater challenges in accurately reflecting the dynamics and breadth of the contemporary production and distribution of content." In short, and in context, the report recognized that existing Federal Government regulatory and support mechanisms just aren't much help to game makers.

And now more than one year on, there are no specific budgetary measures targeting the video game development industry. There are measures for film, performing arts, visual arts and craft, and digital radio amongst other things. But the closest the Budget gets to the word game is noting a contribution of $600,000 to the Department of Communications Information Technology and the Arts for the current year for the staging of the 2007 World Police and Fire Games (Budget Measures 2007-08, page 94, link below).

It is as if the local game industry is just not there.

If the game industry switched places with the film industry you would have $70 million in assistance each year for the next four years to make and sell games in Australia. And in return the film industry would have a Department website stating that the Federal Government only provides "secretariat support" to the film industry and that it is up to "ministerially elected industry leaders [to] devise and coordinate the industry to implement strategies for growth." However the opposite is true.

But the video game development industry is there and it is disciplined and growing.

Forget about any handouts or even a pat on the back from the national government; if this country is going to ensure video game development keeps moving forward with any national initiatives then it is clear it is up to the video game making industry to do it. At least the industry has certain State Government support for important initiatives, especially from the Victorian government.

Source:

Gamenews Weekly

Gamenews Weekly (GNW) is an Australian game industry newsletter published by Gamenews.com.au.

Issue 69 - 11 May 2007.