Ukie annual review
2012
Thank you to the Ukie Board 2011/12 Andy Payne OBE Chairman MD, Mastertronic, AppyNation, Gambitious
Martin Defries Managing Director & COO Rising Star Games Ltd
Ian Livingstone OBE Vice Chairman Life President, Eidos
Jonathan Grimes Regional Director - Retail Sales and Marketing, Microsoft
Matt Carroll Treasurer Commercial Director, Games, The Walt Disney Company EMEA
Geoff Heath OBE CEO 4mm Games
Andy Barker Director of Consumer Services, SCEE
Peter Hepworth Managing Director, UK & Ireland, Activision Blizzard
John Clark Vice President, Digital Distribution (PC), SEGA Europe
Keith Ramsdale Vice President & General Manager Northern Europe, Electronic Arts
Rob Cooper Managing Director, Ubisoft Ltd
Sarah Rogers European Sales and Marketing Director, NC Soft
Spencer Crossley Sales & Marketing Director - Computer Video & Digitial Games, UK & Eire, Warner Brothers Interactive Entertainment
Matt Spencer Vice President EMEA & ANZ Sales, Take 2 Interactive Software
cover image credit: Sifteo
Ukie Annual Review
contents 02 foreword
16 this year and beyond
04 chairman’s report
18 more events
06 ceo’s vision
19 insightful
08 key achievements implemented 2012
20 campaigning for wins
10 2011-2012
24 the future
12 membership
26 future gazing
14 your money, your Ukie
Ukie Annual Review 02
foreword - hon ed vaizey MP minister for culture, communications and creative industries
As a long-time supporter of the games and interactive entertainment industry, I have been very pleased to be part of a government that clearly recognises the sector’s importance to the UK. Britain’s heritage in blending technology and creativity to produce world class games is second to none but in recent years the UK industry has been competing with some countries that can produce games for less cost and that have a better skills base. This wasn’t good enough, and there was clearly a role for Government to do something about it. By listening to the industry and working with Ukie and others, we’ve been able to develop policies that will help to level the playing field. With our planned tax reliefs for games production announced in the Budget 2012, and changes being made to the UK’s education system, Government is creating an environment that will let UK games businesses compete effectively.
The Government’s policies such as the commitment to lower corporation tax to 22% by 2014, the games tax relief, the existing R & D tax credit and getting computer science taught in schools all contribute toward ensuring the UK is now truly one of the best places in the world to produce games (something that was celebrated as part of the Great campaign that the Government ran to coincide with the Olympics). I’m really looking forward to watching the industry evolve in the next few years – with growth hopefully coming from the real explosion of small start-ups, as well as from established UK games businesses and from inward investment by major international publishers.
I have to of course mention another important step for the games industry this year, in the shape of the launch in July of PEGI as the UK’s single age classification system for games. Having a robust age ratings system is vital for ensuring that children are better protected from inappropriate material and that consumers particularly parents - are equipped with the information they need about the content of games. We really need people to understand the new system so I also therefore applaud Ukie’s efforts in promoting PEGI and educating parents about games through the new askaboutgames. com site.
The industry’s hard work in this area shows that it is a mature sector that can lead the way in taking the health and wellbeing of its audience seriously. Ukie has been a strong voice for the industry and the work put in by the Ukie team, (including Deputy Ukie Chair Ian Livingstone), in championing skills, working with Government to get PEGI over the finish line and also promoting a convincing case for tax breaks should be applauded. As a government we will always be looking at further ways that we can help improve the environment for the UK games industry.
Ukie has really demonstrated how, by working with us, you can get real results and I look forward to Government’s ongoing collaboration with Jo and her team so that we can continue to support the UK’s games industry.
Ukie Annual Review 04
chairman’s report - andy payne OBE
It was exactly 2 years ago and what a journey it has
We knew also that games were no longer exclusively seen as just a ‘product’ but some would become a service. Indeed for many, it would become a service that was totally free at the point of access, with players only spending money if they enjoyed the game sufficiently to want more. In short, business models were changing at a pace never seen before in the interactive entertainment space. And so we at Ukie need to ensure that we reflect these developments. As a trade body we are not here to lead the industry from a strategic perspective. We must leave that to the industry itself, namely our members. But we must be on the shoulder of the industry, watching and anticipating, ensuring we proactively represent the industry to media, Government and our consumers. Ukie is not an ‘old boys’ members’ club - we must build and supply affordable services and products which our members can use to build their businesses.
Thus, just like you in your business, Ukie has to deliver more for less each and every year. By growing our membership (up from 90 in September 2011 to 136 right now, a 51% increase in twelve months), setting a rigorous set of objectives and reviewing our operating costs we will stay vital to our members. I am pleased to say that in the last financial year ended May 31st 2012, although turnover was down 9% from £1,969,163 to £1,795,412 our cost of sales were down 10% from £1,035,539 to £931,038. Gross profit was also down, but only by 8%, demonstrating that we have ensured that we rightly anticipated these testing times.
We all know that our businesses no longer rely exclusively on packaged goods sold at retail for 100% of our income. With that in mind, we have also acted to de-risk Ukie further with our sale of our 20% stake in Chart Track for £876,000. By selling our stake not only have we realised incredible value on an asset that would only depreciate in the future, but we have secured the Chart Track information for the next 5 years at a cost of £12,000 pa versus £312,000 pa. The loss of dividends and small operating profit on the annual transactions will not get close to the positives of the sale and we have ensured that the needs of our members have been protected by our decision.
o that Ukie was launched been thus far. We set out to represent the entire interactive entertainment industry and are now well on our way to delivering on that promise. We all knew that our industry was changing fast, and direct to consumer digital distribution would extend the reach of our games. Mobile connected devices have become a welcome addition to the mix, with players using their smart phones or tablets in addition to their consoles and PCs. Times have never been better for games players. Ukie has seen 3 major landmark achievements for the industry this year. Firstly tax production credits that we and Tiga called for were finally announced in the Budget. These were hugely welcomed and will help level the playing field for all game makers. Second, as a direct result of our leadership through the NextGen Skills campaign, the Government announced that Computer Science would be back on the Curriculum. This will address the skills shortage that our industry faces. But children and young people require more than just teaching, they need inspiration. Ukie’s sponsorship of BAFTA Young Games Designer Awards, Games Britannia, the schools festival which showed children how to code and make games, and Abertay University’s Dare to be Digital proved that we act as well as speak. Third, PEGI, the pan European age rating system finally passed into UK law and Ukie is leading the huge consumer awareness campaign. These were 3 massive wins for the industry and show that effective, joined up, evidence led discussion with Government really can deliver results that will benefit our industry.
But any business is nothing without people. I am very proud of the team which we have built at Ukie, which is a combination of the Executive team, led by our new CEO Dr Jo Twist, and the elected board of directors of which I am Chair. I would like to pay special tribute to those directors who have stepped down in this past year. Our Vice Chair David Yarnton, Treasurer Matt Carroll, lead of the Health and Wellbeing working group, Andy Barker and Martin DeFries have all served Ukie with tremendous verve and dedication and will be greatly missed. But the team is nothing without you, the members. We are here to serve you and I can give you my word on behalf of the whole team that we will do this with dedication, passion and good grace. Bring on 2013.
Ukie Annual Review 06
ceo’s vision - dr jo twist
What an amazing 12 months it has been for the games industry. Content, experiences and platforms continue to evolve, new technologies and business models are disrupting familiar ways of doing things and Government has green lit coding in schools, games production tax credits, and PEGI. The games and interactive entertainment industry can and does thrive in this kind of environment: technological change is usually seen as an opportunity not a threat. But there are those who don’t survive and thrive. Knowing exactly where the opportunity lies and avoiding risk can be difficult and that’s where my new vision for Ukie comes in as part of a 21st Century trade body. We want to support businesses of every size to help them to navigate the new ways of making, selling and getting games to players. These are very turbulent times indeed and no one can predict the future. Resilience is a skill that anyone in modern business needs and I have seen so much of that evidenced in the young people in particular I have met who want to set up on their own to change the world. Retail models, business models, changing relationships with players and fans, closures, new UK studios, innovative ways of financing ideas are all making this the most exhilarating, yet unsettled, industry to be in. I unveiled Ukie’s new vision at this year’s Develop Conference. I spent my first three months in the job meeting as many people as I could and listened to what they wanted.
The result is something that is designed around three keywords: support, grow and promote. This is the mantra that will be applied to everything we do as our commitment to you. Our new strategy to deliver this vision focusses on the real needs of businesses which are moving into different ways of doing things – businesses big, small, established and new - as well as the tangible and obvious needs of the emerging parts of the industry and those who are seeking to disrupt it in different ways.
support grow promote
Foul play credit: Mediatonic
This nurturing strategy is about supporting, growing and promoting businesses through three distinct Programmes of activity. These programmes sit alongside our existing services, which include representing the industry voice politically, optimising and protecting games businesses’ intellectual property, providing access to unique market data and promoting the industry to consumers and media.
1
Industry Transition Programme is aimed at established businesses, such as publishers, media entertainment companies and others looking to transition into new marketplaces and business models. A key part of this is our commitment to provide more research, analysis and insight into trends, marketplaces and consumer behaviour.
2
Growth Ready Programme is for micro-studios, start-ups, indies, and disruptive new businesses who are redefining the industry. Key to this focus will be tangible practical support delivered via a new Ukie website, guides, downloadable contracts, toolkits, more focused networking events, and knowledge sharing around access to new ways of financing businesses.
3
Talent Development Programme focusses activity on young talent from school to further education who want to be part of the industry and need support. Key to this is taking on the 16 industry related recommendations from the Next Gen Skills report to build closer links and support, from industry to education and vice versa. We are introducing a Student Membership scheme offering students from games industry courses a simple package of benefits including discounts on events and software and networking opportunities with established businesses.
These Programmes build on Ukie’s existing successes and the services that it has offered since its rebranding as Ukie in 2010. I would like to thank the Board, all of our members and especially our Chairman Andy Payne and Vice Chair Ian Livingstone, for all their incredible hard work and commitment to build the foundations of Ukie. Evidence that we’re delivering what the industry needs can be seen in our rapidly growing membership. We now represent games businesses from all the major UK and global publishers, top UK development talent, promising start-ups and disruptive companies, and some of the biggest, most successful studios operating in the UK today. In fact non-publisher members now make up the majority of our membership. We also have distributors, academic institutions, new publishers, and media outlets that are integral to the lifeblood of the industry as part of the family. A strong trade body is the sign of a strong industry and this is increasingly being recognised by Government. By representing the broadest possible UK games industry, Government knows that we are well informed about issues affecting businesses of all sizes. We come to them with fresh ideas and solutions based on the issues you face, and they come to us for expertise and guidance. Our relationship has never been stronger. With improvements being made to the education system to ensure the flow of talent coming through to the industry and tax breaks being introduced early next year, these are exciting times for the UK games industry. Ukie has played a key role in both of these major policy milestones and we will continue to look at innovative new policy ideas for everyone. This includes looking at the regulations around crowdfunding to see how we can get it operating at its best in the UK.
new for you Free Quick Guides: access to finance, models of publishing and discoverability Best practice guidelines and downloadable standard contracts Start-up and investor ready toolkits Research and insight into new marketplaces and player behaviour Mentoring: Nesta and others Directories of VCs, Angels, competitions, regional growth funds, HR services, legal services Regional masterclasses Academic researcher placements for small companies Speed dating events for developers, investors and publishers
Ukie Annual Review 08
key achievements implemented 2012
These achievements for the industry are a sign of what we can do, together, in the future. We can’t predict what this future holds, but we can be on your shoulder, there when you need us, ready to do what we can to help you prepare for it.
key achievements policy, public affairs, press: Leading the Next Gen Skills Campaign instrumental in fundamental changes being made to the UK’s education system to improve the flow of highly skilled individuals into the games industry Government Consultations, ICT Curriculum Review, Copyright Review, Games Tax Credits, EU Data Protection Directive, Consumer Rights and Parental Controls Influenced Government’s introduction of tax breaks, informed initial discussions with HMT on implementation and held seminars around the country to gather thoughts on tax breaks from over 200 games businesses Initiated PEGI awareness campaign and launched askaboutgames.com Promoted the industry in over 300 press stories about the games industry in national and media Launched Ukie Digital Charts Launched Ukie Public Affairs Digest email to membership events: Held UK Games Showcase at Department for Business, Innovation and Skills attended by Ed Vaizey & Business Minister Mark Prisk Partnered with UKTI to offer discounted access to GDC Europe, San Francisco and gamescom Launched Thursday@3 (ukie.eventbrite.com) Launched weekly Playbeerfridays Major sponsor of Develop Awards 2012 – and screened Indie Game The Movie at Develop Conference Held Digital Shoreditch mixer event for developers, convergence companies, publishers Held Scottish Access to Finance event Organised 2012 London Games Festival Responsible for Edinburgh Interactive 2012 Westminster Summer Reception Supported industry talent development through sponsorship of Games Britannia, Dare to be Digital and BAFTA Young Games Designer competition practical help: Produced Quick Guide to Access to Finance Formed Developer Group and developed Developer Group Manifesto Published Ukie Crowdfunding Report, Access to Finance Paper and Seed Enterprise Investment Scheme Fact Sheet Discounted access to R&D tax specialists, Jumpstart
for publishers
for developers
Ukie Annual Review 10
2011-2012
365 days in numbers
iPhone 5 credit: Apple
2
12
36
major national campaigns undertaken Next Gen Skills to get schools coding and Control.Collaborate. Create. to promote safe gaming to parents and children
government reports produced representing the industry to Government on topics as diverse as consumer rights, child safety online, tax breaks and crowdfunding
sub group meetings topics covered include: digital sales and distribution, e-sports, MMOs, getting access to finance, health and wellbeing, talent development, tax breaks and marketing
50+
52
52
events held sponsored or endorsed by Ukie – giving members access to vital insight and networking opportunities from gamescom and Edinburgh Interactive, to the Develop Awards and Dare to be Digital Protoplay
charts produced unique access to market data for physical and digital markets
news letters sent regularly updating and telling members about great deals, discounts and news
100+ 110
136
IP actions working in partnership with members and enforcement partners to tackle organised crime, on and offline, bringing Proceeds of Crime Act orders in excess of ÂŁ400,000
market reports access to marketplace specific reports and consumer behaviour insight
221
360+ 1000
games businesses consulted across the country, about games tax production credits
major media hits promoting the industry across BBC, ITV, C4, Sky, national and trade print and online
members now a true cross section of the UK games industry including all the major publishers, key UK developers, market leading service companies and educational institutions
the number of visitors to the Ukie British games industry stand at gamescom this year
Ukie Annual Review 12
membership
When Ukie was formed in September 2010, our ambition was to become a trade body for the wider interactive entertainment industry. Since then our membership has grown from 42 mainly publisher members to a membership of 136 companies, representing companies from all parts of the UK interactive entertainment industry. Our membership growth in the past year has come largely from the UK development community. Studios of all sizes have been attracted by Ukie’s key work on skills, education and business support – led by the newly-formed Ukie Developer sub group, chaired by Ian Livingstone. In fact, we are on course to have half of our membership made up of developer businesses in the next 18 months.
We also recognise that the games industry is a truly national business. Ukie now has members all across the UK and we have a dedicated presence in Scotland. This year our Scottish office has organised an access to finance event, networking dinners and sponsorship of Dare to Be Digital in Dundee. Scottish members now account for almost 10% of the Ukie total.
members
sept 2010
sept 2011
sept 2012
1 publishing
30%
2 development
18%
3 education
13%
4 services
12%
5 games media
5%
6 distribution
4%
7 marketing/promotion
4%
8 esports
4%
9 other (trade bodies, regional networks, charities, retailers)
growth in membership since change to Ukie
11%
Ukie Annual Review 14
your money, your Ukie
We’re here to support, grow and promote the UK games industry in an open, collaborative way via four main areas of activity, research & insight, IP & business models, talent development and positive games, which makes us the only trade body to offer the breadth of services and help that the entire industry, whether you are big or small, needs. This year, we are focussing on giving you access to more insight into new marketplaces, through research reports and expert events; working on specific tangible help for small companies and students, whether that be through our Student membership scheme, Quick Guides, downloadable standard contracts, or simple business advice and mentoring; and making sure that the industry’s leading the way in guiding responsible attitudes to games. We know that all our members’ businesses need to make every penny count so we are focussed on giving real value for money membership. We offer flexible ways to pay our rates which start at £500 a year. We have also introduced special rates for start-ups. Irrespective of their annual fee companies can access a series of valuable benefits – discounts and free access to events (worth over £2,000 in 2011), UKTI funding support
for exhibitions (£1,000 or £1,800), free market data and insight (includes a quarterly trends report worth £1,500), discounts off GFK Chart Track reports, networking and introductions, R&D tax credit claim discounts, free practical business help, access to Ukie sub groups that lead Ukie policy, discounts off services from other members and third parties and free use of a central London meeting room (worth £800 a day). Your fee also supports projects for the good of the industry including lobbying policy makers, skills and education, promotion of the industry and building links with other creative industries. Every member receives one vote in elections and we are a not for profit so your annual subscriptions are reinvested into the delivery of new products and services for all of our members.
Dave Bailey, Mediatonic “Ukie has played a key role in connecting us to international businesses and kick-starting relationships that have grown our business substantially. They’ve also given us opportunities to contribute to the tax credit consultations and provided training on key issues like PEGI that affect our projects. The membership has been brilliant value for money and it has been a pleasure to work with the Ukie team.” Adrian Hon, CEO Six to Start “Six to Start joined Ukie because we think it’s essential that indies, large devs, and publishers all work together to show how valuable the games industry is to everyone in the UK, and to ensure that it’s properly supported and recognised by the Government.” James Brooksby, Born Ready Games “Small studios welcome all the help they can get, and - based on our experience with them so far - Ukie are approachable, reliable and quick to offer support. Their assistance over the gamescom preparation period has been incredibly helpful. I am sure we will receive more help from Ukie in time and as we grow.” Spencer Crossley, Sales and Marketing Director, Warner Brothers Interactive Entertainment “Ukie provides us with access to the unique market data that helps decide the direction we take as a business. The GfK Chart-Track boxed product reports are imperative to our planning both short, mid and long term and now Ukie also offer access to their PC download chart which allows us to strategically establish our digital plans. Ukie’s continuing development of these services is extremely valuable to us and I’d urge all members, both old and new, to take advantage of them.”
Keith Ramsdale, VP of Northern Europe, EA and Co-Chair of Ukie’s Positive Games workstrand “Like all other members, EA rely heavily on Ukie to represent the games industry to government. The team have shown this year that they can really deliver results – from getting computer science on to the national curriculum, contributing significantly to the tax breaks debate and getting PEGI over the finishing line. We also rely on Ukie to promote the industry to the general public and have welcomed the work that they are doing to raise awareness of PEGI and to educate parents about games through the askaboutgames. com site.” Sarah Rogers, European Sales and Marketing Director, NC Soft “As a publisher of MMOs there are many issues we have in common with businesses offering consumers similar games and products in the online sector. Ukie’s MMO Sub-Group has been invaluable for us to share ideas, good practices and resolve mutual issues with other MMO companies.” Matt Carroll, Commercial Director, Games, The Walt Disney Company EMEA “Over the past 4 years I’ve served on the Ukie board as treasurer, part of a team that has brought much needed change yet maintained financial security for the organisation while investing and cutting member subscriptions. I’m very proud of the progress Ukie has made during this time to become more relevant to the wider industry and closer to the decision makers who can help our industry to thrive. The biggest challenge for our local based industry is to collectivise in a meaningful way to ensure wherever possible we speak with one voice that represents the scale of our industry - to ensure that best practices are adopted amongst our members to accelerate performance, creativity and distribution and that redtape and legislation doesn’t unnecessarily hinder. Ukie will continue to strive to be that meeting place and to ensure our industry is heard by those who count. I urge all organisations in the interactive entertainment industry to take time to understand the opportunities of joining the team – you may be surprised at what you can become part of.”
Ukie Annual Review 16
this year and beyond
A lot of our new products and services rolling out in 2012 are driven by what you tell us you need. We are committed to getting as wide as possible member representation throughout our sub groups and our Board so that the different needs of different stages and kinds of businesses are heard. This year, we set up a new Developer sub group chaired by Ian Livingstone to discuss the issues that are facing developers and to make sure that we’re always delivering what developers need. The Developer Group Manifesto which they have shaped lays out exactly what it is Ukie is committed to providing for developers in particular. Aside from groups, we are putting on more industry roundtables this year to make sure we are taking action on issues. Our crowdfunding roundtable, for example, is for crowdfunding platforms and content businesses to discuss how to make crowdfunding operate as effectively as possible in the UK, and that guides what we propose to Government.
Moshi monster - Furi credit: Mind Candy
digital group e-sports group MMO group insight and research group developer group intellectual property group PR & industry promotion group next gen skills group If you’d like to get involved with any of these Sub Groups or suggest a new one, please speak to Sam.
Ukie Annual Review 18
more events
In our member survey last year, you told us that you wanted more networking events to meet others, and that’s exactly what we have done, with more to come. We know that sharing knowledge and hearing from peers at events is one of the best ways to gain insight into evolving trends in our business, and to understand how businesses are exploiting their IP through different business models. This year we have focussed more on events, especially outside of London, that give games businesses the chance to share and mix with each other. This year we started our monthly Thursday@3 speaker and beer sessions aimed at developers at Ukie HQ with industry speakers, big and small, themed around different stages of business - from accessing finance to how to be heard above the noise and get your game discovered. Accompanying these are free Quick Guides which will be rolled out later in 2012. We also started our #playbeerfridays in the Ukie HQ playroom each Friday. Every week we invite individual companies, students, and veterans to share their games, their needs, their stories and to play with us. At our Ukie Scotland launch in March, we held an access to finance seminar, and this is rolling out in other regions later in 2012. Other events that are planned include investor speed dating, regional masterclasses, two game jams, and a new series of Thursdays@3. Informal events and gatherings are important: but we know that formal conferences are just as valuable to you.
This year, we were pleased to have been appointed by UKTI as the exclusive trade body partner for gamescom, GDC Europe and GDC San Francisco. To date we have managed the UK Industry stands at gamescom and GDC Europe in Cologne. We offered pre-event support, on sight administration, networking drinks receptions and vital market insight as part of series of affordable packages. A grand total of 23 UK companies joined us and over 1,400 people visited the UK stands at gamescom and GDC. Now in its 10th year, Edinburgh Interactive once again delivered an exceptional and forward thinking series of business presentations. New additions included free public sessions and a Dragon’s Den style pitching session that led to an investment of £50,000 in a young company. Events are also important for you to meet the people who are influencing policy decisions. We are in constant conversation with politicians and policy makers about the big issues concerning the games industry. This includes regular meetings in Westminster as well as arranging for MPs to visit our members’ offices and studios. In June, we held our Ukie Summer Reception to give members a chance to speak to politicians directly. At the reception, we had key speeches from senior Coalition MPs, Ed Vaizey and Don Foster, who both praised the work of Ukie, its members and its Board. We have a programme of MP events including dinners planned for 2012, but let us know what else you need us to do.
insightful counting digital
gametrack: exclusive
Ukie is increasing its commitment to helping you access vital research and insight. We are recruiting a dedicated researcher and are expanding our own data sources alongside those of key third party companies. We already deliver outstanding GFK Chart Track / Ukie Games Chart reports on the UK boxed market which are both extremely high quality and valuable tools for business planning and industry promotion. Alongside this we regularly distribute research from our partners on key business trends. The two key areas of research for the forthcoming year are digital sales reports and consumer insight and trends. Earlier this year we Beta launched the UK’s first PC digital chart based on real sales data. This meant that for the first time companies were able to evaluate sales performance, undertake benchmarking and assess promotional campaigns with information based on actual data and compare their performance in this key market with other businesses and products. To create the PC Download Chart we currently get data directly from Ukie members detailing their PC download and expansion game / DLC sales. The data is believed to represent 50% of the UK market and is starting to give a valuable insight into this market. The PC Download Chart is currently in a closed beta trial and only those that put data into the report currently receive the aggregated sales data.
Data on consumer purchases, habits and trends has often been regarded as the best way to assess the relative size of the market given the difficulty in securing actual sales data. However no one company has managed to create a consumer panel of sufficient size and quality to be regarded as reliable – until now. European games body ISFE, working with Ipsos Mori, has developed a new, major panel survey under the name GameTrack which looks certain to be established as the primary consumer research source for our industry. And Ukie has been appointed as the exclusive UK agent for these quarterly reports.
Please speak to Sam We shall be rolling out digital charts for other platforms and formats over the next year. example of the Ukie PC download chart
credit: gametrack
your IP In an ever increasing digital world, our members’ intellectual property takes many forms, involving different business models, and therefore demands varied operational methods by our IP unit to support and ultimately protect that IP and see it grow in value. Research is and will be an important element in dealing with digital IP infringement and this year we contributed intelligence to a study carried out by PRS for Music and Google into the various business models of copyright infringement. The study forms a good foundation for future action and makes interesting reading. There is no single solution to tackling the availability of illegal games files in all forms on the internet and our IP crime team uses a number of different methods to reduce the levels of infringing material. These have included offering services for notice and takedown procedures, payment system and advertising removal from appropriate sites, search engine de-ranking and domain name suspension/ removal. We also continue to monitor and inform our members about developments in IP policy, from site blocking and search engine de-ranking to the Digital Economy Act and Steam key fraud.
The full report can be found here: http://tinyurl.com/UKIE-IP
Ukie Annual Review 20
campaigning for wins
This year, we have seen how effec campaigns can be in making chan adopting this dedicated campaign The priorities for 2012 have been tax credits and crowdfunding, and skills
finance
We want to ensure that the industry has the right flow of talent coming through and help to create the next generation of UK developers. At the end of 2011, we created and continue to lead and fund the Next Gen Skills cross-industry coalition that has successfully called for computer science to be introduced onto the national curriculum in September 2012
Our nationwide consultation programme on the tax production credits was an open, inclusive and extensive one. As well as being asked by the Treasury before the consultation to help them understand the shape of the industry, we reached a total of 221 individual companies (including 85 non-Ukie members) from multinational publishers to one-person indie studios and everything in between. We also met with TIGA during this process to share thoughts and feedback to make sure that a consistent voice was presented to Government on this crucial issue.
key tax credit recommendations Government is urged to make sure that the new scheme supports all parts of the industry – encouraging growth from small independent studios, existing bigger studios and attracting inward investment from multi-national companies. The rate of relief should be set at 30% for all UK games development. There is no need for a minimum budget threshold for games to qualify for relief. Next Gen Skills MP Call to Action launch at Summer Reception As well as running the Next Gen Skills campaign to get computer science on to the national curriculum, we also support talent in other ways. We created and run the Games Ambassador Scheme in partnership with STEMNET, to get volunteers from the industry into schools to talk to children about careers in games. So far the Ambassadors have spoken to over 8,000 school children nationally. We have also focused in on investing in industry talent through sponsorship of key educational projects and indie developer competitions, including: Dare To Be Digital Protoplay, Games Britannia, BAFTA Young Games Designer.
Assurances needed that the new business models and ways of making games which stretches beyond “release” are recognised in the new tax system - which means that games businesses can claim for production costs incurred for DLC or as games continue to be developed and iterated. The tax credits are just part of the story though. We’re always looking at innovative new ways of financing for UK developers and start ups and are working with Government to help make crowdfunding as effective as possible for games businesses. All sides of the political spectrum are interested in what we are proposing. We are also planning a competition with Abertay Prototype Fund this year, and are always on the look out for extra funds and pots of money you can take advantage of.
ctive focussed, well-resourced nge happen. We shall be n approach into the next year. around skills, finance including d positive games. positive games We played a key role in having PEGI introduced as the single age rating system for games this year. To coincide with this, we launched our Control.Collaborate.Create. campaign which runs until December 2012, and we re-launched askaboutgames.com to be an on-going consumer and industry resource. The site plays an integral part in delivering the wider campaign’s messages with information and tips for consumers, and showcases of how playing games is a collaborative and creative experience. We will continue to support askaboutgames.com for the long term. So far we have had over 300 pieces of news coverage and askaboutgames has had close to 30,000 visitors. We have also distributed more than 50,000 leaflets promoting our safe and sensible gaming messages via Game and HMV stores.
control ensuring that consumers have
the knowledge of the tools that they can use to control games content (including PEGI, parental controls and the need to take regular breaks)
collaborate encouraging parents to engage
with and understand the games that their children are playing We continue to represent the lead role that the games industry plays in child safety, through responding to Government consultations on parental controls and through our permanent seat on the Board of the Government’s UK Council for Child Internet Safety.
create
promoting games as a creative, fun and worthwhile activity for everyone
Ukie Annual Review 22
We give you opportunities to promote your businesses, whether this is through the press or events such as the ‘Your UK Games Industry’ that we held at the Department for Business, Innovation and Skills earlier this year. The showcase (pictured) gave Ministers the chance to speak to leading UK games businesses and gave them some hands-on time with some of the latest games being produced by UK studios. Looking ahead, we are focusing on tangible and practical support for startups, micro studios, as well as established businesses. These new products and services will be served through a vastly improved website which is being built and will complement the existing introductions we make between members, events, PR, research and policy work we already do. We have already done a lot – we want to do more for you.
Your UK Games Industry BIS installation
The games industry is the fastest growing creative industry in the world and our members make some of the best, most innovative products on the market. We want to promote you, what you do, what you make, to potential creative partners, investors, the media and policy makers – making sure that they’re all aware of the amazing potential that the games industry offers.
Ukie Annual Review 24
the future
We are undoubtedly an industry in transition but is this necessarily a bad thing? We know that more and more people are playing games but there is less certainty over which platform or device they will be using and how they will be paying for them. LEGO Batman 2 credit: LEGO
Where will it leave the industry in the future?
Ukie Annual Review 26
future gazing
Our members give their visions of the future:
OUYA open source console credit: ouya
Ian Livingstone OBE, Ukie Deputy Chair and Life President of Eidos
John Clark, Vice President, Digital Distribution (PC), SEGA Europe
Jonathan Smith, Head of Production, TT Games
there has never been a better time for original content creators to succeed
this means that the key expertise that publishers offer will remain vital
sending ahead of us swarms of agile, laser-firing attack ships
Whilst there will always be winners and losers in our technology-driven, fast-changing sector, this is an incredibly exciting time to be in the games industry. My prediction for the future remains very optimistic for the UK. I firmly believe there has never been a better time for original content creators to succeed. With production tax credits being introduced, and the right flow of computer science and art graduates entering the industry, the UK will regain its rightful place as a worldleading games powerhouse, producing games on multiple formats to serve global markets via super high-speed broadband.
Whilst disruptive forces continue to buffet the industry, games will still need to be sold and distributed no matter what the platform or market place. This means that the key expertise that publishers offer will remain vital. In fact as more and more games are produced and sold on purely digital marketplaces, standing out from the crowd has already become increasingly difficult – meaning that the relationship between publisher and developer may be redefined but the effective implementation of both sets of skills will still determine the success of a game.
At TT Games, like roaring dinosaurs, we’ll continue to have hundreds of talented UK-based staff developing blockbusting console games for oldfashioned retail distribution supported by traditionally vast marketing campaigns - while simultaneously sending ahead of us swarms of agile, laser-firing attack ships to secure further successes in exciting new digital realms. With the broadest possible reach across devices, technologies and commercial models, we’ll be offering fun to players wherever they want to be.
Ukie Annual Review 28
Charles Cecil MBE, Revolution Software
Andy Payne OBE - Chairman MD, Mastertronic, AppyNation, Gambitious
crowdfunding is such an extraordinarily exciting development, only possible because of social media
change is constant and you must be prepared to ensure you have a state of mind that can cope
Every corner of the computer games industry continues to evolve at breakneck speed. Key drivers in this change are the opportunities that emerge from digital distribution and social media. While the number of boxed products that can appear at retail is limited by shelf space, digital distribution obviously offers unlimited virtual space. So developers are no longer constrained by what a retailer will stock, or what a publisher will choose to publish - instead we can sell directly to our fanbase, and communicate via social media rather than through traditional, expensive marketing. This, of course, creates new issues - like discoverability. But the UK has traditionally been a nation of innovators, and our developers have the rare opportunity to grasp the opportunities that this disruption has thrown up. A key issue is funding - a role traditionally covered by publishers. Venture Capitalists with their focus on a quick return and high profit multiples is one option, but much better, if possible, is crowdfunding which not only offers preferable opportunities to raise money but also to galvanise the fan base. Crowdfunding is such an extraordinarily exciting development, only possible because of social media - I am sure that many new models will evolve which have the democratisation of funding at their heart.
I love my job because I work with great people, whether that be at Mastertronic, AppyNation, Just Flight, Ukie, GamesAid, BAFTA, Gambitious or the UK Government. In those roles I am charged with looking into the future in the games industry. Spotting trends, looking for gaps and engaging with my peers and all that kind of stuff. But as a friend of mine once said, ‘time in the Internet world is measured in dog years’, in other words it is faster than anything the preInternet world is used to. That means change is constant and you must be prepared to ensure you have a state of mind that can cope. Rules come and go and winners turn into losers in a flash. In games this is even more acute, because we are in the epicentre of the tornado and I cannot see that changing or indeed us getting out. One thing is for certain, individuals (‘singularis’ as our Latin scholars would say) will always play a lead role in driving change. Whether those individuals work for large corporations (‘corpus’), in much smaller groups, or go solo, the Internet has allowed individuals to have a voice and to lead change. We are seeing the inexorable rise of the Indie games makers and I don’t see that stopping. Gamers, namely the people who pay our wages, are desperate to connect to those who make the games.
Those people who have invested tons of time in making games with all the gut wrenching that goes with it. They want to know who they are, why they do what they do and how they do what they do. And now they want to get involved, and some even want to put their money where their mouth is and invest via crowdfunding platforms. Social media has been a real enabler in this move from ‘corpus’ to ‘singularis’ and is just brilliant. Yes people are interested in a corporate feed, but they are far more interested in what individuals have to say, hearing what they really think, unedited, without spin and in real time. Those that try to muzzle this progress are missing the whole point. Change happens every single day, it is unpredictable, fun, challenging and sometimes downright cruel. Companies and brands will come and go, but games are created and played by real people and that is why it has never been a better time to be in the games business as a creator, investor or a player, or all three. Here’s to the rise of the Singularis. Vive L’Evolution!
our staff Dr Jo Twist, CEO jo.twist@ukie.org.uk @doctoe Daniel Wood, Head of Communications and Public Affairs daniel.wood@ukie.org.uk @damelW Sam Collins, Head of Commercial sam.collins@ukie.org.uk @ukiesam John Hillier, IP Crime Unit Manager john.hillier@ukie.org.uk Theo Blackwell, Campaign Manager, Next Gen Skills theo.blackwell@ukie.org.uk Euan Mackenzie, Ukie Scotland euan.mackenzie@ukie.org.uk Sandhya Sivasothy, Accounts Manager sandhya.sivasothy@ukie.org.uk David Smith, Marketing and Communications Executive david.smith@ukie.org.uk @Dave74205 Andy Tomlinson, Public Affairs and Policy Officer andrew.tomlinson@ukie.org.uk @AndyTomlinson84 Alexa Turness, Events Manager alexa.turness@ukie.org.uk @Ukie_Lex Claire MacBeath, Team Assistant and PA to CEO claire.macbeath@ukie.org.uk Special thanks to Sabine Telesford who leaves us this year after covering Claire’s maternity leave for almost a year.
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our members 1C UK Ltd 3MRT Ltd 505 Games Ltd Activision Blizzard UK Ltd AGI World Ltd AIME Ltd AppyNation ASP Solutions Ltd Atari UK Publishing Avanquest Software Publishing Ltd Awillys Ltd Bigpoint Marketing Ltd. Birmingham City University – Gamer Camp Birmingham Science Park Aston Blazing Griffin Blue Graphics Ltd Born Ready Games Ltd Brand Culture Sport and Entertainment Ltd Casual Games Association CCS Media Packaging CE Europe Ltd Centresoft Ltd ChangYou.com (UK) Company Ltd Channel Four Television Company Ltd Codemasters Ltd Creative Assembley De Montfort University Disney Interactive Studios UK DNA Easy Interactive EJW Creative Ltd Electronic Arts Ltd Eurogamer Network Ltd European Gaming League FatBob Games Ltd FC Business Intelligence Ltd. Focus Innovation Focus Multimedia Ltd Future Publishing Ltd Game Central GAME Stores Group Ltd GameHorizon Games Aid Games Britannia Gem Distribution Ltd Get Games Online Ltd Google UK Ltd Green Man Gaming Harbottle & Lewis LLP Hardlight Hasbro Europe Ian Hamilton Design & Consultancy Indigo Pearl Ltd Intent Media Ltd Interactive Opportunities Ltd Internet Advertising Bureau Jumpstart UK Ltd K7 Media Ltd. Kalypso Media UK Ltd Kantar Worldpanel Koch Media Ltd Konami KPMG Licensed 4 U Ltd Ludus Magnus Majesco Europe Ltd Makieworld Ltd. Mastertronic Group Ltd Mediatonic Ltd Microsoft Ltd Middlesex University Mind Candy Ltd Multiplay
Namco Bandai Partners UK Ltd National Film & Television School NCsoft Ltd NESTA Nintendo UK Ltd Nordic Games GmbH Norwich University College of the Arts OK Media Ltd One Thumb Mobile Ltd OnLive Ltd OPM Response Ltd Osborne Clark LLP Piggyback Interactive Ltd Playdom Inc. PlayMob PQube Ltd Railsimulator.com Ravensbourne College Reloaded Productions Replay Events Ltd Revolution Software Ltd RIE Studios Ltd Ripstone Rising Star Games Ltd Scottish Enterprise Secret Sauce Ltd. SEGA Europe Ltd Sheffield Hallam University Six to Start Ltd. Soccer Manager Ltd Somethin Else Sony Computer Entertainment Europe Ltd Sony DADC UK Ltd SpecialEffect Ltd Splash Damage Ltd. Sports Interactive Ltd Spotless Interactive Square Enix Ltd Take2 Interactive Software Europe Ltd Tandem Events Ltd Target Media Ltd Team Dignitas Tecmo Koei Europe Ltd Teeside University - School of Computing The Games Tribe Ltd The Stationery Office Ltd THQ International Ltd Trion Worlds Europe Ltd TT Games Publishing Ubisoft Ltd Unity Software Ltd University Centre Grimsby, Grimsby Institute of Further & Higher Education University of Abertay Dundee University of Bournemouth University of Glamorgan; Cardiff Sch of Creative & Cultural Industries University of Hull University of the West of Scotland University of Wales, Newport (Skillset Media Academy Wales) VGM Virgin Media Ltd Warner Bros Interactive Entertainment White Room Games Ltd World Gaming Executives Xiotex Studios YoYo Games Ltd Zenimax Europe Ltd / Bethesda Softworks Europe Ltd
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