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Gaming's growth paves the path for digital exports

Gaming's growth paves the path for digital exports

Almost all of the New Zealand gaming industry's revenue in the past year came from exports, with success stories like SmallWorlds gaining a million new users in less than three months after launching in Brazil in May and role-playing game Path of Exile raising more than US$1 million of crowdfunding in pre-purchases during its closed beta development.

nz gaming industry growsKiwi game studios released 73 commercial video games in the last year – according to a survey of NZ Game Developers Association members – and are primarily selling them digitally on iPhones, websites and Android smartphones.

Sixty percent had released games for iPhones/iPads, while 40 percent had released Android smartphone games; 65 percent had published games that could be played in a web browser and 30 percent had made PC games.

Flick Kick Football by PikPok reached number one on the US iPhone free game charts, and Major Mayhem by Rocket Jump reached fifth position.

The survey found 99 percent of sales revenue came from exports, with the US and Europe being our largest markets, and 97 percent were digital downloads.

“Gaming is a high tech, high growth industry that is at the forefront of digital business models,” says NZGDA chairperson Stephen Knightly.  “We’ve learnt how to make money from business models like digital distribution, freemium, virtual goods and crowdfunding. Exporting and acting global from day one have been key to the industry’s growth.”

The local industry has nearly doubled in the last two years and employed 380 full-time equivalent game developers as of March 31. Almost 80 percent were either artists or programmers, split fairly evenly.

Only a third of the industry’s revenue came from contract work, with the balance being made on direct sales, subscriptions, royalties and advertising. Much of the local contract work has been from 'serious games', such as training, health or educational games, which were made for local businesses and other organisations.

Teenage depression management game SPARX by Metia Interactive and the University of Auckland Medical School had its successful clinical trials published in The British Medical Journal.  The study was reported worldwide in media such as Time magazine, The Daily Mail and The Huffington Post.

“As the Kiwi games industry matures we’re seeing that games studios are very good creators of intellectual property,” says Knightly.

“A successful game franchise can be ported to other game platforms, sell merchandise, sell music and have multiple sequels.  The shelf-life of a game can be much longer than a movie franchise in many cases.  After a few years that investment really begins to pay off.”