Germany’s Gaming Industry Is A Serious Business

The National Numbers

Germans are known to be very fond of gaming: roughly half of the 81 million population is an active gamer, and chances are that he or she (half of the gamers are women) will be playing on his or her computer. Floating devices such as tablets and portable gaming consoles are becoming increasingly popular, as well as smartphones, but personal and laptop computers remain the devices of choice. Cross platform gaming is also common. Germans aren’t only fond of playing: they’re also glad to pay for this kind of entertainment. About 70% of gamers (the highest percentage in the world) pay for their video games and in 2013 game sales were higher than both music and movie box offices.

Germany is not only a land of players: it’s also very active in the production and distribution of video games. With 320 companies and over 10.000 employees in the value chain, the industry is steadily growing and it doesn’t seem to be slowing down anytime soon. In fact, the market size of the worldwide mobile gaming industry alone is expected to double this year, compared to 2014, and the growth of the industry in Germany is line with the global trends.

It currently accounts for 5% of the global game sales and the only concern seems to be the lack of support from the Government and the inadequate offer for education in the field. It’s a common complaint across the industry that the Government is failing to recognise the full potential of one of the most dynamic and creative industries in the country. It’s not a small concern, but it’s also true that Germany can rely on an ever-growing flow of creative talents from abroad, so the industry is unlikely to collapse for lack of workers.

The Local Industry

Thanks to big companies such as Bigpoint Games, dtp Entertainment, and gamigo, all founded between the late ’90 and the mid 2000s, Hamburg is one of Germany’s biggest gaming clusters along with Cologne and Berlin.

According to the Hamburg Startup Monitor there are only 24 gaming startups based in the city, which is a very small minority compared to other sectors such as commerce, media, and services, but this handful of publishers and developers employ one third of the whole startup workforce. This data is not that surprising considering that Goodgame Studios alone employs over 1,200 people and it’s the single most successful free-to-play gaming startup in the country. The second biggest player in the local gaming industry is InnoGames, with 350 employees and six successful browser games.

As mentioned earlier, the international component is extremely important both for production and distribution. Both companies distribute their games worldwide, but they also rely on international teams. Employees from 30 different countries work at InnoGames and from 60 at Goodgame Studios. Another factor that will shape the future of the industry is the increasing competition among companies, whether affirmed or startups, and it’s likely that their growth strategies will involve more and more investment in Marketing, Business Development, and Data Analysis, and that they will try to expand their user base to segments of the population that are not traditionally gamers.

Further Info

For a list of all gaming startups in Hamburg, you can check out the Startup Database of the Hamburg Startup Monitor. For more insight about the German gaming industry you can have a look at this infographic from 2014 and this other one from 2015.

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