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A Digital Gaming Strategy for Malta A DIGITAL STRATEGY FOR MALTA A Report to guide a National Policy in the setting up of a Digital Games Industry in Malta in accordance with a range of references. Digital Gaming Strategy for Malta Report Version 2.0.1 Date: 1st February 2012 1 “A Digital Gaming Strategy for Malta” is an independent Report prepared by Games Audit UK Ltd. The Report does not necessarily reflect the views of Malta Enterprise, the University of Malta and the Malta Council for Science and Technology, on whose behalf it was prepared. Extracts from the document have been removed due to confidentiality and data protection issues. © 2012. All rights reserved. Copyright Games Audit (c) 2012 Page ii A DIGITAL STRATEGY FOR MALTA Our Team Professor WILLIAM LATHAM IAN SHAW CEO of Games Audit Ltd, Director of Games the leading operational Technology Consulting. and technical due Across a 20 year career Diligence Company for Ian has shipped games investors, banks and selling more than 50 completion bond million units, including companies. While CEO of Harry Potter, Formula-1 leading games developer and Kinect. Ian was Computer Artworks previously Chief Technology Officer of William produced the hit Electronic Arts Europe, Publishing Playstation and Xbox game The Thing based Development Manager at Microsoft, and Head on the cult movie for Universal Studios. He is of R&D at Bullfrog Productions. Professor at Goldsmiths (University of London). HEATHER CHANDLER Dr. GORDON CALLEJA After producing Associate numerous hits for Professor and the Electronic Arts, Head of the Ubisoft, and Center for Activision, Heather Computer Games founded Media Research at the Sunshine in 2005, a IT University of full-service game Copenhagen. Gordon currently teaches on the production provider. During her time in the Media Technology and Games MSc Programme industry Heather has worked on numerous at the Center for Games Research. Gordon has titles, including Sacred 2: Fallen Angel, Two published extensively within the field of Games Worlds, Monster Madness: Grave Danger, Research primarily in the areas of game Rainbow Six 3: Raven Shield, and eight games involvement, immersion and presence, in the Ghost Recon series. She is the author of narrative and game ontology. He has recently several books on game development and a published a book on game involvement and frequent guest speaker at conferences and immersion with MIT Press titled "In- universities. She graduated with honours from Game:From Immersion to Incorporation". Vanderbilt University and received an M.A. from the USC School of Cinematic Arts. Page iii Copyright Games Audit (c) 2012 A DIGITAL STRATEGY FOR MALTA CHRIS LEEBETTER NICK GIBSON Currently Director of Founder and Director of Directed Research, Chris Games Investor was previously Director of Consulting is a specialist Programmes for Digital games research, corporate Markets and Enabling finance and strategic Technologies at ITI management consultancy Techmedia, and Scottish Enterprise. Among numerous advisory assignments, Chris advised Enterprise Ireland on how to improve the innovation capability of RICK GIBSON companies in the digital media and games space. As a member of the Technology Founder and Director of Advisory Group, Chris developed a technology Games Investor strategy for Scotland published as “Towards a Consulting is a specialist Brighter Future”. Chris previously worked for games research, over 18 years at technology consultancy corporate finance and Sagentia in Cambridge. strategic management consultancy, Nick and Rick have Professor FREDERIC FOL LEYMARIE advised over 80 international clients (including Professor of Computing 6 government departments in 2 countries) at Goldsmiths with specialist analysis of the games industry, (University of London), authoring or editing a broad range of research Co-Director of the post- reports published by Screen Digest, the UK graduate program in government, two trade bodies and NESTA. Computer Games and Entertainment at Goldsmiths College. Current research JEANINE RIZZO projects include ProGen (procedural modelling of 3D cities in games) in Associate, Fenech & collaboration with leading UK Games Fenech Advocates in Developer Rebellion Valletta. Jeanine practices in intellectual property law, copyright, trademarks, patents, design rights, art and cultural heritage law, and entertainment law. She is also a lecturer on Intellectual Property Procedure, Diploma in the Laws of Procedure, with the University of Malta. Copyright Games Audit (c) 2012 Page iv A DIGITAL STRATEGY FOR MALTA Executive Summary Goals. In May 2011, Malta Enterprise, on behalf of the Digital Games Initiative Group comprising ME, MCST, UoM and the Creative Economy Working Group, contracted the UK company Games Audit Ltd to undertake research, interviews and analysis to deliver a report required to guide a national policy in the setting up of a Digital Games Industry in Malta in accordance with a range of references. The aim of the report was to work at two levels, firstly to attract foreign direct investment (FDI) and secondly to identify ways of stimulating, supporting and expanding the local games industry in Malta. Exciting Opportunities. The worldwide games industry (valued at $49bn in 2010 more than doubling in size since 2005 due to substantial growth in both retail and network gaming) is expanding rapidly and is expected to experience a CAGR between 2010 and 2014 of 9% but is fragmenting at the same time with many emerging new platforms and technologies - varying from console to tablet, mobile to online and social and associated new business models. “Gamification” is even extending game play elements into other software applications and apps. The expanding games market and its central role in the Creative Industries presents many opportunities for Malta but also challenges. Methodology. The methodology used to produce this report included Games Audit using its own expert in house staff combined with a number of industry experts from the UK and USA. Standard research methods such as comparative analysis, gap analysis, and modelling were used to build on conclusions from important face to face interviews. Director William Latham and Gordon Calleja spent considerable time in Malta in July and August 2011 carrying out local audits and interviews. The help of Maltese companies interviewed was much appreciated and local audit work was supported by Jeanine Rizzo from Fenech and Fenech Advocates. The International consultations included interviews with leading games industry figures at the E3 Games Conference in Los Angeles (the largest global annual games conference) in May and the Develop Games Conference (the leading European Games Conference on casual and mobile games) in Brighton, UK in July. Other interviews, such as with major game publishers, were secured through the teams extensive personal contact network. Work by Rick and Nick Gibson, in addition to looking at games industry trends, included analysis of existing fiscal incentives such as tax incentives offered by other territories to attract games companies. A range of countries were analysed and evaluated including Canada (Quebec), Singapore and France with the purpose of identifying specific fiscal incentives offered that Malta could choose to adopt or adapt. Overall Findings. The overall findings of the report showed that Malta has a very early stage games industry, with small and energetic companies who are highly motivated to do well, often aided by Government incentives and occasionally EU Grants. A small number of related companies in advertising, localisation, editing, audio, legal, and finance give indications of an early stage industry framework for outsourcing and collaborative work that could expand. The strong IT industry with over 200 operations in Malta provides a sound technical context for games development work, experienced technical staff available with specialist skills relevant to the growth areas of the games industry including analytics and data mining expertise. Where additional support is needed to cover any small games specific skills gaps, short training courses are provided by educational establishments. The recently started and commendable annual “indie games” competitions are also assisting in developing skills, enthusiasm and team work around games at a local level in Malta. Page v Copyright Games Audit (c) 2012 A DIGITAL STRATEGY FOR MALTA The industry consultations revealed that international games companies view the low games industry headcount in Malta as a major concern, it also revealed that the existing “refund on dividends scheme” offered by Malta which offers tax refunds on the dividends that are paid to company shareholders was viewed as a strong benefit by small / medium privately owned games companies subject to knowing what other incentives are on offer. Malta Enterprise’s strong history of, and ability to, rapidly engage with companies interested in locating to Malta and where appropriate construction of large scale bilateral investment deals to the benefit of Malta and the relocating company will be an important element of growing the Digital Games industry moving forward. The industry consultations revealed that currently games companies knew little of what Malta offers in terms of incentives and opportunities and that significant marketing is necessary in the games industry press and at games industry conferences. The report goes into depth on other feedback from the international consultations. Transferable
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