5 min read

Brexit and its Repercussions on the UK’s Video Game Industry

Matt Brown's picture
April 5, 2017
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The United Kingdom is home to many, much loved video game companies. Some have spent decades in Britain such as Rare, creators of classics such as Banjo Kazooie, Goldeneye 64 and Perfect Dark. Rockstar North are Scotland based and have worked on many GTA titles and the Red Dead Redemption series. Relatively new studios such as Hello Games (No Man’s Sky) and mobile game creators ustwo (Monument Valley) are also based here. There is a wealth of talent in the UK, both old and new, however a certain referendum had last year is likely to put that in jeopardy.

Last Week the Prime Minister of the Britain finally triggered the infamous article 50 which began the UK’s exit from the EU. President of the European Council Donald Tusk commented that there was “No reason to pretend this is a happy day” as he sullenly held up a vague letter written to him by Theresa May outlining how she wanted the negotiation to go down. So far it doesn’t look too rosy.

From within the gloom we have received the first few glimpses into what Brexit may look for the UK’s games industry through the eyes of UKIE (UK Interactive Entertainment). They have not been positive to say the least.

In its report UKIE highlight many worrying factors that would deter future and current development in the UK’s gaming industry. According to their study 40% of companies would consider moving their company away from the UK, 23% of which have already been approached by other locations. 37% are finding it harder to attract investment. A meagre 2% of business asked thought that Brexit would have a positive impact.

These startling facts come down to a few factors:

Talent - Developers will find it more difficult to employ EU citizens, who are a large, geographically close pool to draw from. We are still unsure whether these citizens living in the UK will even have the right to stay post Brexit.

Markets - If the UK does not get a “good deal” with the EU and receives tariffs on exporting of both digital and physical goods then developers are unlikely to want to base themselves in that country. To be based in the EU would give them a much larger audience to who it is cheaper to sell to.

Information – As a mainly digital industry, the ease of data sharing is extremely important to the video games industry. It is therefore vital that the “flow of data” between the EU and the UK remain the same to maintain stability within the industry.

Funding - EU funding platforms will be removed which means that UK will have to rethink how it funds similar projects. A beneficiary of the EU’s Creative Europe scheme was British developer The Chinese Room. They have produced games such as Everybody’s Gone to the Rapture and Dear Esther. It is unlikely that the video games industry is at the top of the list when it comes to resorting out the funding and so future developers similar to The Chinese Room will have to wait or look elsewhere.

A common theme within this report is uncertainty. Will EU employees be allowed to stay? Will developers keep EU funding that they have secured? Will games be hit with tariffs? Here lies one of the key issues of Brexit, not just for the video game industry but for the entire country. There is 47 years of EU red tape to untangle and reassemble. Nobody knows how long it will take or whether some of it will be cut in the process, either unknowingly or through necessity. It might be that the video game industry is massively stimulated by Brexit, but this has not been hinted at by any politician or research study.

All we have heard from these politicians is empty rhetoric and hollow promises. Before the referendum we were told that £350 million a week saved from the EU could be spent on the National Health Service. That was promptly forgotten on 24th of June. This is not just because of Trumpian styled “alternative facts”, it is mainly out of ignorance. If Theresa May can still not say whether or not EU nationals can stay in Britain then she cannot possibly know whether funding for smaller, British video game developers will continue.

Meanwhile, in amongst all this uncertainty is avoidance. Why would you want to open a new video game studio in London when you could potentially be narrowing your talent pool or missing out on funding opportunities? Better to open one in Berlin instead.

When Theresa May triggered article 50 last week she started an arduous process which has never been done before and may turn out to be detrimental to her own country. Meanwhile who knows how many opportunities Britain is now missing out on because of the cloud of uncertainty looming above. Maybe the next GTA will be worser for it, maybe we will never get another Monument Valley, but what is truly scary is that we do not know what opportunities we will miss out on, both during and after the process. In an ever globalising video game industry and world, the risks of Brexit are likely to be vague, uncertain and seismic. Will we be able to say that the UK’s game industry has improved post Brexit? At the moment the stats are pointing south.

You can read the full report here

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