Schemes for digital gaming fling doors open to US$45 billion global market

By introducing measures aimed at boosting investment in the digital games sector, government is tapping into a global US$45 billion market, which is set to complement the already established Malta-hub for iGaming.

Delivering his Budget on Monday, finance minister Tonio Fenech announced an initial €150,000 investment into a Malta Games Fund, which will provide for marketing the island as a strategic base for digital gaming companies to operate from.

While tax credits will be offered to local companies which will commission educational digital games, government will be extending tax incentives to professionals in this sector.

Foreign game directors or designers in the sector who would shift to Malta are set to benefit from a 15% flat rate in taxation. The scheme is also directed to academics and researchers.

The digital gaming sector is set to complement the success obtained by Malta in iGaming, which according to government's estimates - published in Monday's Budget - has earned the national coffers €47 million in taxation.

Digital gaming incorporates the creation, design, marketing, downloads, mobile apps, subscriptions and gaming on social networks.

Over the past three years, the sector is said to have generated US$45 billion globally, with a number of countries, namely India, Canada and the United States racing to design attractive packages to host the domains.

The sector is governed internationally by the Entertainment Software Association (ESA) which has also included authorship as a key profession.

Video game development and authorship, much like any other form of entertainment, is frequently a cross-disciplinary field, which primarily includes programmers and graphic designers.

Over the years this has expanded to include almost every type of skill that one might see prevalent in the creation of any movie or television program, like sound designers, musicians, and other technicians; as well as skills that are specific to video games, such as the game designer. All of these are managed by producers.

In the early days of the industry, it was more common for a single person to manage all of the roles needed to create a video game.

As platforms have become more complex and powerful in the type of material they can present, larger teams have been needed to generate all of the art, programming, cinematography, and more.

This is not to say that the age of the "one-man shop" is gone, as this is still sometimes found in the casual gaming and handheld markets, where smaller games are prevalent due to technical limitations such as limited RAM or lack of dedicated 3D graphics rendering capabilities on the target platform (e.g., some cellphones and PDAs).

With the growth of the size of development teams in the industry, the problem of cost has increased.

Development studios need to be able to pay their staff a competitive wage in order to attract and retain the best talent, while publishers are constantly looking to keep costs down in order to maintain profitability on their investment. Typically, a video game console development team can range in sizes of anywhere from 5 to 50 people, with some teams exceeding 100.

In May 2009, one game project was reported to have a development staff of 450.

The growth of team size combined with greater pressure to get completed projects into the market to begin recouping production costs has led to a greater occurrence of missed deadlines and unfinished products.

The market is huge, and so is the potential for Malta.

MaltaToday is informed that government has already engaged consultants who together with Malta Enterprise and the Malta Financial Services Authority (MFSA) are to draw legislation and packages to attract digital gaming companies.