A lot of video game companies operate out of the United Kingdom, and they're now being faced with a stiff new reality that sees the U.K., leaving the European Union over the next two years. Some of them are worried about how Brexit is going to impact the business of gaming.
According to Game Informer, the U.K's gaming industry supports more than 18,000 jobs from 2,000 different companies across multiple cities, Providences, regions and countries. The U.K., pulling out of the European Union has been seen as a terrible thing by some, a good thing by others, and a frightening thing by a few.
The reality is that we really won't know what the real effects of this pull-out will be like until around two years from now when things finally settle down and the separation is made complete. According to Dr. Jo Twist, the CEO of the United Kingdom Interactive Entertainment trade commission, it was mentioned to Game Informer that the Brexit vote will bring some measure of uncertainty but the future of the United Kingdom's gaming industry will be centered around digital distribution, so that uncertainty is padded in the security of a steady direction...
Ukie is committed to ensuring the UK is the best place in the world to make and sell games, and although this decision and the political uncertainty it brings will have an impact on our businesses, it is important to remember that we are already a globally successful sector and a leading exporter in the digital economy,
Ukie will continue to work hard with colleagues in government to ensure we continue to have the best possible business environment and we will be following developments closely as well as advising members as they unfold.
Some developers worry that this could have a lasting impact on the sales, exports, remote hiring and pricing of the U.K's gaming industry.
Eurogamer talked with a few more developers and market insiders who were a little more skeptical about the doom-saying going around. They felt as if it would be at least two years before things settle enough where we can get a full, detailed idea of what the political landscape will look like, and how it will affect the hiring and taxation of games, as well as the selling and trading of games.
Given that the U.K., is home to some of the biggest and most prominent video game studios in the world, such as Rocksteady Studios -- the makers of the Batman: Arkham games -- and Rockstar North -- the makers of titles like Red Dead Redemption and Grand Theft Auto -- some aren't too worried about where the U.K., will stand when the dust settles. Good games will sell.
Eurogamer managed to get word from Piers Harding-Rolls, the analytical director at IHS Technology, who explained that the biggest hump that the U.K's gaming industry might face is pricing... specifically when it comes to hardware, saying...
There has been at least one example in the past where UK pricing has been increased, specifically for console hardware, in response to a weak pound. Any currency exchange rate swing is more likely to impact console hardware pricing over software, as margins on hardware are generally tighter than on software.
It's worth noting that we have the most competitive retail environment for games sales in Europe and this keeps our games pricing low compared to mainland Europe. I wouldn't expect the recommended retail price of games on existing platforms to change if the pound's weakness continues, but there may be a moderation on discounting based on reduced margins.
Commenters are divided across multiple sites based in the U.K. They're unsure what will happen, but a few are curious about importing games from U.K., based outlets such a Play.com. Will the change in the value of the pound affect import/export sales? Will a drop increase exports? Will a rise increase imports?
The only major and consistent worry that some people are having is with tax breaks for start-up studios in the U.K. Will the breaks stay? Will they go? For the most part, any region with a growing games market has maintained tax breaks on video game start-ups, from Canada to Australia. It would seem unlikely that the U.K., would change taxation to weaken one of their economy's strongest assets.
As mentioned near the top of the article, the worry over game sales shouldn't be too bad given that the global trade market for the gaming industry is mostly centered around digital distribution. Despite the whole fear-mongering from the Brexit vote, things will likely stay business as usual for the most part, especially if gamers keep buying games and developers keep making games.