Download BC Video Game Industry

BC Video Game Industry
September 18, 2012
Rick Griffiths
Partner, Media & Technology
Global entertainment and media market
(US$ millions)
Segment
1999
2005
2009
2016
27,407
137,582
228,060
493,390
5,316
25,758
60,558
188,069
N/A
141,885
185,901
290,596
101,254
146,170
148,560
254,745
Recorded music
35,247
34,525
26,372
25,274
Filmed entertainment
60,971
79,717
85,137
99,657
N/M
29,402
52,507
82,976
78,605
71,475
80,184
179,419
154,887
181,224
45,487
43,190
56,244
Internet access: wired and mobile
Internet advertising: wired and mobile
TV subscriptions and license fees
TV advertising
Video games
Consumer magazine publishing
Newspaper publishing
Radio
PwC
Slide 2
Global internet access
PwC
3
Video games globally
Shift from console to online games
PwC
Slide 4
Video games in North America
Online growth lagging Asia but climbing
PwC
Slide 5
Video games in Asia
Online growth far exceeds console growth
PwC
Slide 6
Video game spending (US$ millions)
50000
45000
40000
35000
30000
25000
20000
15000
10000
5000
0
2007
2008
2009
2010
2011
Global console/PC games
PwC
2012
2013
2014
2015
2016
Global online/wireless games
Slide 7
Miscellaneous relevant video game industry data
2011
BC
Quebec
Ontario
Total jobs
3,882
8,236
2,600
Companies
83
86
96
Console
86%
77%
62%
(CES)
Estimated Canada jobs data
1998 (PwC)
4,000
nk
nk
2009 (PwC)
3,100
nk
nk
2007 (CES)
52%
26%
16%
2011 (CES)
28%
53%
17%
•
Estimated company data
BC
PwC
1998
2011
2013
(PwC) 41
(CES) 83
(DigiBC) 90+
Slide 8
BC GDP 2008
GDP
Employment
GDP per
employee
Forestry and logging
2,027
17,300
117,168
Wood products
2,594
33,600
77,202
Oil and gas extraction
7,795
2,200
3,543,182
Mining
4,468
14,100
316,879
Retail trade
11,380
263,000
43,270
Tourism
7,068
131,400
53,790
High tech
10,508
85,580
122,786
3,039
171,109
Video games (PwC) 520
Source: BC Stats; millions of dollars
PwC
Slide 9
Canadian Digital media tax incentives
BC
Quebec
Ontario
Manitoba
Nova
Scotia
17.5%
No
37.5%
50%
40%
100%
40%
No
50%
No
30%
150%
30%
No
-
-
-
500k
-
-
Restrictions
-
-
-
-
$500k or
$15k per
employee
-
Eligible Marketing &
Distribution
-
-
40% up to
100k
-
-
Qualified Direct
Provincial Labour
Expenditure
Contract Labour
included
Maximum Credit
PwC
Prototyping &
development
50% up to
$100k
PEI
New
Brunswick
Slide 10
Observations since mid 90s
• The big console studios built this industry but are under severe
pressure
• Small and mid size companies’ recent growth is significant – the
landscape has diversified
• Complementary digital media industry growth is strong (social
media/VFX/animation)
• We still grow companies to sell
• Venture capital is thin but angel capital is robust
• A united voice of the industry has been slow
• Little political vision or leadership
PwC
Slide 11
To sum up
• Global domination of the internet
• Digitization of all entertainment & media
• Maturation of console business
• Explosion of mobile/social business
• Small can compete with big and become big quickly
• BC is no longer number 1
• Over-investment in high cost structures and console?
• Poor political championing and competitive economic policy?
• Vibrant community of world class talent
PwC
Slide 12
The Challenge
Are we are at the end of the beginning or…
• I am really proud of this industry
• The industry has evolved radically and rapidly
• But… digital production talent is now global
• Lower cost structures are now vital to big studios
• Companies can/will go anywhere – governments want this industry
• But… we have come from nowhere to become a world class player
• Spawned a vibrant ecosystem with little help
• But… the ecosystem is creaking and we’re maybe losing our edge?
• But… we are in the entertainment and media industry’s sweetest spot
• Are we happy, or if not, what are we going to do about it?
PwC
Slide 13
© 2012 PricewaterhouseCoopers LLP. All rights reserved. In this document,
“PwC” refers to PricewaterhouseCoopers LLP, an Ontario limited liability
partnership, which is a member firm of PricewaterhouseCoopers International
Limited, each member firm of which is a separate legal entity.