Now that Brexit has become a reality, there are bound to be both short term and long term knock-on effects for the UK Games Industry. As a studio that has benefited immensely from our European friends in terms of trading, hiring, funding and inspiration, there is a strong possibility Tag will suffer from the decision to leave the European Union.
Despite our immediate disappointment we must look beyond the current uncertainty and work towards a stronger UK Games Industry, protecting the support we have fought so hard to win and working together for our mutual benefit.
Whilst the weakened pound has set alarm bells ringing in financial markets, on the flipside it will at least provide an immediate boost to any studio being paid in non-sterling currencies. Any sustained weakening of the pound will help to make British studios stronger in the short to mid-term, as most UK developers export their services globally and our industry is already very competitive on a cost/quality basis. A devalued pound is only going to make the UK an even more compelling proposition for buyers, which is especially beneficial for studios that work on a “work for hire” basis, or for art/engineering outsourcing companies.
When we consider teams that are self-publishing and generating own IP the picture changes dramatically however. Many in the UK industry have made use of EU creative or technology grants at one time or another, and there’s a real danger that the end of this financial support will prevent many of these more ambitious projects from getting off the ground. Likewise the increased cost of ad inventory for studios running their own user acquisition could negate any benefits experienced from a weakened pound. This is especially relevant in the F2P market, where ad inventory sales is the largest single cost for companies. Our concern is that this puts us on a path that will potentially hinder creativity, innovation, self-determination and risk taking within the UK industry and move us back towards being nothing more than a collection of development sweatshops.
In terms of the movement of talent, many in the industry are voicing concern, but we’re remaining cautiously optimistic. As a company we pride ourselves on bringing in creative people from all over the world and freedom of movement helps us find the best of that talent. Maintaining strong trading terms with the single market will require us to maintain these open borders, so we’re confident that going forward we’ll still be able to cast the net wide when recruiting with minimal friction.
There are other considerations to take into account. The future of Games Tax Relief and R+D Tax Credits is already being raised by concerned parties and there are plenty of other unanswered questions.
Like all industries across the UK today the games sector is looking at a future trading environment that could be quite turbulent in years to come. Despite the fear and uncertainty Tag remains excited at the prospect of continued partnership with our European neighbours and friends despite today’s vote.