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More exhibitors at Gamescom Gaming industry tries to shake off post-corona blues

21.08.2024, 18:34 Listen to article

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The interest is huge, but the funding in Germany is poor: this is how the situation surrounding Gamescom 2024 could be summed up. The industry generates enormous revenue, but hardly any from games made in Germany. Internationally, too, not everything is going smoothly, as the VR dilemma shows.

The world’s largest computer games trade fair, Gamescom, attracted tens of thousands of people to the Cologne exhibition halls. After it started with a show on Tuesday evening, company representatives and game fans flocked to the stands of the more than 1,400 exhibitors – that was 15 percent more than last year. At the stands, visitors could try out new games and talk to developers. The queues at the areas of Microsoft Xbox, Ubisoft with its game “Star Wars Outlaws” and Capcom with “Monster Hunter Wilds” were long.

In the coming days, the rush at the public fair will probably be even greater, Saturday is already sold out. The fair ends on Sunday. In 2023, 320,000 people came to the industry event. The games industry inspires many millions of people every year “with great enthusiasm for innovation and creativity,” wrote Digital Minister Volker Wissing on X. It develops “cutting-edge technology that has applications far beyond games”.

The unofficial kick-off took place on Tuesday evening with an opening show in front of a specialist audience and the media, in which a new part of the “Borderlands” game series and details of the next part of “Call of Duty” were announced. Industry heavyweights such as Microsoft and Tencent from China are represented in Cologne, but not the Japanese companies Sony and Nintendo – the reasons for this remain unclear.

The presence of large US technology companies is striking. The opening show, Opening Night Live, presented the series “Secret Level”, which is due to be released on Amazon Prime in December and combines various worlds from the gaming world. The Netflix game “Squid Game: Unleashed” is also being advertised at the fair.

VR games want to get out of the niche

There are also new products from the virtual reality sector: The action game “Batman: Arkham Shadow” is being advertised; it can only be played with the Quest 3 VR glasses from Facebook’s parent company Meta.

It has long been expected that this visually promising area will emerge from its niche, but VR games have not yet become a real box office hit. Ultimately, it is a kind of chicken-and-egg problem: There is little demand because there are few applications, and there are few applications because of the weak demand. The VR glasses that used to be incredibly expensive are now available for less money, so it is possible that mass business is gradually emerging. With the Batman game, at least a new attempt is being made.

Billion dollar games business

At Gamescom, young people are the main visitors. The booth for “Civilization”, a strategy game from the studio Firaxis, is downright nostalgic. This is the seventh edition of the classic game, which will soon be released. The first edition of Civilization dates back to 1991.

Computer and video games are a billion-dollar business: last year, people in Germany spent almost ten billion euros on games, hardware and online services. In the first half of this year, the business, which had experienced a strong growth spurt during the Corona years, weakened. Overall, increased costs and weaker demand are weighing on the industry, which has scared off investors.

Gamescom is an international meeting place, German developers only play a minor role – only about five percent of the money spent on games in Germany goes to games that were developed there. The industry association Game, which organizes Gamescom together with Koelnmesse, is calling for more government support.

In Germany, around 12,400 people work in the games industry in around 950 mostly small companies. Domestic companies include Deck 13 from Frankfurt, which has around 90 employees, Rockfish Games from Hamburg (35 employees) and Envision Entertainment from Ingelheim (Rhineland-Palatinate, 18 employees).

According to the Games CEO Lars Janssen, the industry has good prospects. Interest in games is increasing, says the association representative. It is not just young people who play on consoles, computers or smartphones. “There are more and more people who are still playing in their 50s or 60s or are even starting to play.” The games in the industry are so diverse that completely different interests can be catered to.

Federal funding policy under criticism

Janssen is also the head of the studio Deck 13, which has released action games such as “The Surge” and “Atlas Fallen”. Some time ago, the company received a commitment from the Federal Ministry of Economics to receive almost five million euros in funding for the development of a new action game. The payment will be made gradually over several years, and the game – project name Foxtrot – is scheduled to be launched in 2027. The company was lucky in a way, because the Federal Ministry of Economics has been suspending funding applications since March 2023 – new applications will probably not be able to be submitted again until early 2025.

Felix Falk, managing director of Game, the association of the German games industry, referred to disputes between the Ministry of Economic Affairs and Minister of State for Culture Claudia Roth. As a result, no applications could be submitted yet. “This is particularly frustrating in the challenging situation.”

The current funding freeze has meant that some studios are no longer internationally competitive, said Falk. “The money has simply run out.” Roth and her party colleague, Economics Minister Robert Habeck, must “sit down urgently and reach an agreement so that the companies can finally access the funds.”

This dry spell is a nuisance for the Game industry association. “This is really a disadvantage for many companies here in Germany,” says association representative Janssen, calling for a reliable and continuous funding policy. Representatives of the federal states – such as Bavaria’s Digital Minister Fabian Mehring from the Free Voters – are also very critical of Berlin’s approach. Federal Minister of Economics Robert Habeck, whose department is responsible for games funding, was expected to attend on Wednesday evening. He will open the fair with North Rhine-Westphalia’s Prime Minister Hendrik Wüst and Cologne’s Mayor Henriette Reker.