Setting the Scene: The Global Gaming Market
The global gaming market is currently valued at €179 billion, with over 3 billion people worldwide actively playing video games. However, the European Union (EU) only captures a small fraction of this market. In 2021, the EU gaming industry was worth a mere €18.3 billion, representing just 11% of the global market. Despite a recent downturn, industry experts predict a compound annual growth rate (CAGR) of 10-12% in the coming years. At this pace, the gaming market is expected to surpass €400 billion by 2030. For the European game industry merely to maintain its current position in global competition, its value must more than double by 2030 (i.e. attain a value of €40 billion), and this requires vision, focus and targeted support for European game developers and businesses.
Societal Challenge: Unlocking Gaming’s Potential Beyond Entertainment
The gaming industry is primarily viewed as an entertainment sector, a perspective that overlooks the significant potential for the gaming industry to contribute positively to other sectors and society more broadly. Currently, key technological developments shaping the future of the gaming industry are driven by non-EU actors. Moreover, non-EU platforms often impose market access barriers on EU creators, a challenge that needs addressing to align with the UN’s Sustainable Development Goals (SDGs) 8 and 9, which focus on decent work, economic growth, and fostering innovation.
Education Challenge: Nurturing Talent to Maintain Market Share
For the EU to maintain and grow its market share in the global gaming industry, access to talent is crucial. This challenge is not limited to the development of specialised game industry curricula. Gaming has a vital, and increasing, role in schools, but many teachers feel insufficiently trained to incorporate gaming into their lesson plans. There is also a need for synergy between gaming and related sectors, as well as with studies in relevant technologies. Ensuring that the workforce is well-equipped with the necessary skills will be key to sustaining the industry’s growth.
Innovation Challenge: Navigating Global Platform Limitations
Global platforms currently pose significant challenges for EU gaming companies, especially in terms of access to data, market entry, payment providers, and distribution channels. To stay competitive, the EU gaming industry must adopt disruptive trends and technologies such as artificial intelligence (AI), third-party payment systems, no-code platforms, and user-generated content. Additionally, EU regulations need to adapt to these technological advancements to create a more favourable environment for innovation.
Business Creation Challenge: Competing on a Global Scale
EU gaming companies are struggling to maintain their global market share, with American and Asian companies leading the way. Both start-ups and scale-ups in the EU face significant challenges, particularly in accessing risk capital. Furthermore, European games often lack visibility in a saturated market, which further hinders their growth and market share. Addressing these challenges is essential for the EU to compete effectively on the global stage.
Impact Goal: Supporting SMEs in Adopting Disruptive Technologies
To address these challenges and stimulate growth, the focus is on increasing the adoption of disruptive technologies among EU SMEs in the gaming sector. The goal is to see a 1.25% increase in SMEs adopting technologies such as AI, no-code platforms, third-party payment systems, user-generated content, and digital ethics by 2027.
Supporting Start-ups and SMEs: A Comprehensive Plan
To achieve this, we plan to support up to 450 start-ups by 2027, with the founding of approximately 150 new companies. We will assist these start-ups in securing future funding rounds, aiming to attract around €16 million from private investors. Additionally, we will offer training and upskilling opportunities to approximately 5,000 game employees by 2027. Some of these companies will hopefully be from the games sectors – depending on applications and the selection of our independent expert juries.
By 2027, EIT Culture & Creativity will also select 25 companies with global scaling potential to negotiate shareholding by SAFE agreements (Simple Access to Future Equity) and long term partnerships with a purpose i.e. beyond return of investment. We can, for example, provide highly experienced board observers and post investment services such as networking with potential clients.
Disclaimer: These plans are depending on the approval of the EIT grant in autumn 2024.
A Welcome Package for Start-ups and Scale-ups in 2025
To further support start-ups, we offer from January 2025 onwards a service package for EIT Culture & Creativity community participants (a yearly member fee of €500). This package includes :
– Access to the entire EIT Creative Cluster network, which comprises universities, research organisations, cities, cultural institutions, and businesses.
– Invitation to two tailored pitching events in 2025 at both regional and European levels.
– Opportunities for tech transfer with EIT CC research and technology organisations, such as Fraunhofer and RI.SE.
– Registration in the EIT CC digital participation platform (DDP) for year-round search, pitch, and networking opportunities and contact person at EIT CC team.
– A training course on the EIT Innovation Ecosystem for the Cultural and Creative Sectors and Industries and the EIT Culture & Creativity, starting in October 2024 or later in 2025.
Conclusion: A Path Forward for the EU Gaming Industry
The EU gaming industry faces significant challenges, from talent shortages to competition with dominant global players. However, with strategic investments in education, innovation, and business creation, there is tremendous potential for growth. By fostering an environment that supports disruptive technologies and by providing targeted support to SMEs and start-ups, the EU can strengthen its position in the global gaming market, creating a more sustainable and innovative future.
For more information mail to investmentclub@eit-culture-creativity.eu
