UK Industry Headlines

UK Success Stories

The UK has a long history of making world class video games. With the global games audience estimated between 2.2 and 2.6 billion people and the global software market expected to grow from $137.9 billion in 2018 to an estimated $180.1 billion by the end of 2021, the opportunities for the UK games industry have never been greater.

As of December 2019, there are 2,285 active games companies in the UK, operating at all sizes and scales, with world-class talent across the full spectrum of games technologies - from mobile, PC and console, to fast-developing sectors such as VR / AR, esports and Artificial Intelligence.

Recent global UK successes include:

• Grand Theft Auto V by Rockstar Games, is the most financially successful media product of all time, selling over 115 million units worldwide to date and over $6bn in global revenue. It is the fastest selling entertainment product ever, grossing $1bn worldwide in just 3 days and the top selling game of all time in the UK, generating over £240m from more than 6 million physical copies sold - or roughly 3.5 sales per minute, as well as being the top-selling game in the US in terms of both revenue and units. GTAV still continues to defy expectations, returning to the top of the UK chart in March 2018, 4.5 years after it was first launched.

• Batman: Arkham Knight by Rocksteady Studios, the fastest-selling game of 2015 and winner of multiple awards, including the 2016 BATFA for Best British game.

• Monument Valley / Monument Valley 2 by ustwo, downloaded over 26 million times and winner of 20 international awards, including Apple iPad Game of the Year 2014 and the 2015 BATFAs for both Best Mobile & Handheld and Best British game. The 2017 sequel has achieved revenues of $10.4 million and been downloaded over 30 million times, primarily due to its release for free in China.

• Hellblade: Senua’s Sacrifice by Ninja Theory, winner of 5 BAFTAs in 2018, including Best British Game, as well as numerous other awards and accolades. It was one of the top selling games on Steam in 2017 and was the best-selling PlayStation game in Europe the month it was released. The game was widely recognised for its pioneering work depicting the mental health of the main character, based on research partnerships with the University of Cambridge, the University of Durham and the Wellcome Trust.

• Blood & Truth by Sony London Studio, the first virtual reality title to top the UK charts. The game was described by its developers as a "love letter to classic cockney gangster movies".

• Lego: Star Wars / Batman / Harry Potter / Avengers by Traveller's Tales. The Knutsford-based studio has built a name for itself with its Lego adaptations of much loved film franchises, achieving critical and commercial success with its charming and humorous family-friendly games.

• Runescape by Jagex, the world's most popular free MMORPG. With a mobile version of the game now in early access, Runescape's success looks set to continue.

• Forza Horizon 4 by Playground Games, the fourth spin-off from the Forza Motorsport series has won multiple awards including the 2019 BAFTA for "Best British Game". In June 2019, Playground Games announced that the racing game had reached 10 million users.

• LittleBigPlanet 3 by Media Molecule and Sumo Digital, developed collaboratively between Media Molecule in Guildford and Sumo Digital in Sheffield. With an all-star cast of narrators including Stephen Fry and Hugh Laurie, the platformer was praised for its creation mode being "made more accessible than ever before".

• Until Dawn by Supermassive Games, the BAFTA winning narrative survival horror game was described as a "sleeper hit" by Sony Worldwide Studios President Shuhei Yoshida after its sales surpassed the companies expectations.

• Football Manager by Sports Interactive. The long running series which sees players take control of a football club of their choice has an influence that extends into the real world of football. Premier League clubs including Everton FC have used the game as a source for scouting real players and in Azerbaijan a student was even promoted to manager of FC Baku's reserve team, based on his success in Football Manager.

• No Man's Sky by Hello Games. On the first day of its PC release in 2016, the space exploration game had the highest number of concurrent players on Steam for the year so far. Guildford's Hello Games has remained committed in its improvement of the space exploration game, releasing major content updates for free, including multiplayer components and virtual reality support.

• Overcooked / Overcooked 2 by Team17, family friendly multiplayer game which challenges players to take the role a chef, overcoming obstacles as they prepare as many meals as possible within a time limit. Both the 2016 original and its 2018 sequel have been nominated for multiple BAFTA's, recognising the fun collaborative mechanics in the games.

There are plenty more. We support the Creative Industries website which features more great UK games stories.

UK Consumer Market

The UK is the 6th largest video game market in 2017 in terms of consumer revenues, after China , USA, Japan and Germany. Approximately 37.3m people in the UK play games.

According to the 2018 Ukie UK Consumer Games Market Valuation, UK spend on games was valued at a record £5.7bn in 2018, up 10.0% from 2017 (£5.18bn, revised figures):

• 2018 was the biggest ever year for games software, growing +10.3% to a record £4.01bn in sales, driven by record results in both Digital and Online sales, which eclipsed £2.01bn for the first time, up +20.3%, and Mobile Games, which grew +8.2% to £1.17bn . Boxed software remains a substantial factor in software sales, experiencing a slight drop of -2.6% to £770m, however pre-owned games dropped significantly -30.8% to £67.9m.

• Game hardware continued to be a core driver of spend in 2018, up +10.7% to £1.57bn. Consoles sales grew a solid +6.5% to £702m, despite no new consoles being released. PC game hardware sales saw a strong year, up +18.4% to £445m, and the peripherals and accessories market similarly increase +19.9% to £355m. VR Hardware had a more difficult year, dropping -20.9% to £72m, as early adopters await the next generation of headsets.

• Consumer spend on wider game culture contributed an additional £109.6m in revenues across game-related toys, merchandise, books, movies and soundtracks, as well as game-based events around the UK.

According to the Entertainment Retailers Association (ERA), combined physical and digital sales UK games sales in 2018 generated a record £3.86bn, increasing 9.1% on the previous year.

This figure is now greater than that of home music and video sales combined, comprising 51.3% of the overall value of the sector, making the UK games market 1.65 times the size of the video market (£2.3bn) and 2.9 times the size of music (£1.3bn).

Digital games sales provided the majority of growth, increasing 9.1% to £3.01bn, while physical game sales declined slightly by -2.1% to £769m, although not as drastically as in physical sales for both music (-16.6%) and video (-17.1%).

In 2016, Electronic Art's FIFA 17 was the highest selling entertainment product in the UK, selling 2.5m units, approximately 9% more sales than Star Wars: The Force Awakens, which sold 2.3m units.

UK Games Map

In September 2016, Ukie launched the UK Games Map, the first interactive, real-time map of the UK games industry.

Built in partnership with Nesta, the UK's innovation foundation, the UK Games Map builds on the methodology established in the 2014 Ukie/Nesta report 'A Map of The UK Games Industry' to provide the most complete dataset of the geography of the UK games industry ever compiled. A more detailed description of the UK Games Map can be found here.

The UK Games Map is constantly being updated with new data from across the industry - since launch in September 2016 there have been more than 1,000 updates to company data on the platform.

Key findings:

• There are 2,277 active games companies in the UK (listed in the map, as of December 2018)
• 2,728 UK games companies have been mapped to date
• 62% of UK games companies were founded since the beginning of 2010
• Only 41% of UK games companies use the right Standard Industrial Classification codes
• The map also lists 149 games industry service companies and 231 games-related courses across 95 universities and academic institutions.
• As of June 2018, there 21 towns / cities that are home to more than 20 games companies, the top 10 of which are listed below:

Top 10 Towns by Company Count (Jun 2018)
Town / City	No. Companies
London	614
Manchester	96
Brighton	73
Guildford & Aldershot	70
Slough & Heathrow	67
Cambridge	53
Bristol	50
Sheffield	41
Glasgow	37
Liverpool	37

Economic Contribution

In October 2018, the BFI published a report covering the games industry's economic contribution to the UK in 2016, entitled 'Screen Business'. Both the full and summary versions of the report and can be downloaded in full via the BFI website.

Findings from the BFI's Economic Contribution report:

• Overall in 2016, the UK games industry provided 47,620 FTE jobs and contributed £2.87bn in GVA to the UK economy.

• The UK games industry directly employs 20,430 FTEs in development, publishing and retail roles, which contribute £1.52bn in direct GVA to the economy.

Direct economic contribution of the UK Games Industry in 2016
Subsector	Employment (FTEs)	GVA (£m)
Development	13,840	826.0
Publishing	2,300	526.6
Digital Retail	310	31.7
Physical Retail	3,980	132.0
Total	20,430	1.52

• The economic impact of the growing UK Esports sector was also assessed for the first time and was shown to have supported 470 FTE jobs and contributed £18.4m in GVA in 2016.

• In 2016, the UK games industry spent £1.25bn on game development.

• In the period 2015-2017, there was at least £1.75bn of inward investment in the UK games industry.

More detail on the economic impact of the UK games industry can be found via the 'Screen Business' page.

Video Games Tax Relief

Video Games Tax Relief (VGTR) has been available for qualifying games companies to claim since April 2014.

The BFI 'Screen Business' report, released in October 2018, showed the economic impacts of the relief in 2016

• The VGTR supports 9,240 FTE jobs across the UK games industry, including 4,320 directly in development roles (31% of the total UK development workforce).

• VGTR games represented £389.9m of UK development spend, 31% of the total development spend. Overall, projects supported by the VGTR contibuted £525m in GVA to the UK economy and £158m in tax revenue.

• 68% of VGTR-supported games would not be made in the UK, or at all, without the relief in place.

• For every £1 the Government invested into the games sector via VGTR, an additional £4 in GVA was generated for the UK economy.

• Of all the screen sector tax reliefs, the games sector was shown to have the highest rate of productivity, where each employee generated an average of £83,800 in GVA for the economy, significantly above the national industrial average of £62,100.

According to data released by HMRC in July 2018, VGTR has provided £230m to UK studios across 770 claims since the relief was launched in April 2014. Of that total, £105m was paid out to 345 claims in the financial year 2017-18.

To date, VGTR has been claimed by 480 video game productions, accounting for over £1bn in UK expenditure.

The latest annual figures from the BFI Certification Unit on how many games passed the cultural test for qualification for VGTR were released in May 2017. The full BFI release is available here.

The latest end-of year figures for games certification numbers are:

VGTR Cultural Test Certification, Apr 2014 – Mar 2017
Certification	Number	EEA/UK spend £m	Total Budget £m	EEA/UK spend as a % of total budget
Final	364	423.9	548.4	77.3%
Interim	370	1,146.4	1,280.6	89.5%

However, in October 2017 the BFI released further data showing that 161 games received final certification between 1st Jan to 30th September 2017, representing £136.8m EEA/UK spend from a total budget of £159.5m. This is a 25% increase in the number of games, but a slight decrease of -3.8% in EEA/UK spend over the same period the previous year. Looking at interim certifcication in the same period, 130 games were interim certified (-9.7%) representing an £296.6m of EEA/UK spend (-2.3%) and a total budget of £319.6m (-11.5%).

• Final certification covers games that have been completed and released, and have claimed their tax relief.
• Interim certification covers games that are still in development but have been approved for the cultural test.
• Some games that have progressed from development to completed and released since the launch of the VGTR may be counted in both Interim and Final categories.

Since the relief was introduced in Apr 2014, the number of games gaining final and interim certification has increased significantly year-on-year. In the financial year 2016/17, 212 games received final certification while 187 received interim certification, an increase of +59.4% and +38.5% on the previous year respectively.

• In FY2016/17, the 212 games that received final certification had a total budget of £258m, £220.4m of which was spent in the UK. For the 187 games recieving interim certification, the total budget was £482.2, £412.2m of which was spent in the UK.
• Median budget for the projects applying for VGTR has also shown a huge year on year increase, rising from £0.2 million in 2014 to £0.7 million in Q1 2017.
• Games qualifying through the 'cultural test' typically receive a return of about 20 per cent of their development costs.
• The BFI publish as list of all video games certified as British through the video games cultural test, which can be downloaded here.

UK Esports

• In 2016, the UK esports audience will grow to 6.5 million people, with 3.1 million watching more than once a month. The audience is expected to grow 7.5% year-on-year to reach 8 million people by 2019.

• According to PWC, the UK esports market will see a 27.6% CAGR, reaching £8m in consumer ticket sales by 2021. Digital advertising in esports will increase to £12m by 2021, a CAGR of 46.2%.

• Esports is popular with millennials in the UK, with the 21-35 age group representing 63% of the market. Women make up 31% of the audience and are most likely to watch when aged between 21-35.

• The largest prize pool event held in the UK to date was ESL One Birmingham, with a prize pool of $1 million, held at Arena Birmingham in May 2018.

• The UK is the home to some of the world's top esports talent. One of the UK's leading esports teams, Team Dignitas were acquired by the owners of the US basketball's Philadelphia 76ers in September 2016.

• Major UK football clubs including Manchester City and West Ham United have signed professional esports players.

• The UK's largest gaming retailer, Game, acquired Multiplay, one of the UK's longest established esports businesses, for £20m.

• There is also growing grassroots esports scene in the UK's universities, with 3,000 players in the National University Esports League, representing 110 universities.

UK Mobile Games

• There are 1,483 active games companies making mobile games in the UK (as of August 2017).

• The UK has the largest mobile games workforce in the EU, with 5,000 full-time employees. This represents nearly a quarter of all 21,000 mobile game jobs across the EU.

• 71% of UK adults (approx 40m) own a smartphone and 59% of UK households (approx 15.9m) own a tablet.

• 47% of UK smartphone owners use apps on their phones to play games – more that use apps for online banking (40%) or reading the news (33%).

• 44% households own an iPhone, 46% and Android phone and 12% a Windows phone.

• The free apps with in-app purchase model is king, representing 76% of the revenue share of the UK for apps.

• In terms of revenue per download, the UK is best positioned in western Europe with a potential profit of $0.47 per download. The UK is more profitable than Germany, United States and China.

UK Player Demographics

There are several different estimations for UK player demographics available:

Newzoo:

• In 2017, 32.4 million people play games in the UK. Spending $4.2 billion this year, they make the UK the 5th largest games market in the world.

• The UK mobile market is very evenly represented between the genders, with a 48% female / 52% male split between those who are playing more than once a month.

• 32% of UK players play mobile, console and PC games.

• In 2016, there were 31.6m players in the UK, approximately 50% of the total population. Of those that play games, 59% of them spend money on games, annually spending an average of $206 per player.

GameTrack:

• There are 20.6m people aged between 6 and 64 playing games in the UK, or 43% of the population in that age group. (2017 Q3)

• On average, 11 to 64 year-olds in the UK spend 9.5 hours per week playing games. (2017 Q3)

• Across all UK 6-64 year olds, 25% (11.7m) played packaged games, 22% app games (10.6m) and 24% (11.4m) online games. (2017 Q3)

• Similarly, 27% (12.7m) play on consoles, 24% (11.4m) on computers, 22% (10.6m) on smartphones, 17% (7.9m) on tablets and 10% on handhelds (4.5m). (2017 Q3)

• 57% players in the UK are male and 43% female. The largest single age/gender demographic is 15-24 year-old males, making up 15% of all players. (2017 Q3)

Specialised Courses and Qualified Workforce

• UK higher education is a strong supporter of the games industry. 60 universities/colleges provide 215 undergraduate and 40 master video game courses throughout the UK in 2014. (Creative Skillset)

• 23% of the courses are in London, 18% in the West Midlands and 16% in Yorkshire and the Humber: these 3 regions cover 57% of all courses provided. (Creative Skillset)

• The top 3 universities in number of courses provided are: Staffordshire University (29 courses), University of East London (17 courses) and Sheffield Hallam University (16 courses). (Creative Skillset)

• The computer games workforce is highly qualified, with 63% having a degree compared to 57% of the wider Creative Media workforce and 37% of the wider UK economy in 2011. (Creative Skillset)