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South Africa's gamers mean business

South Africa's gamers mean business

More businesses are turning their attention to South Africa's R100 million-plus gaming industry and looking to invest in games to empower employees, differentiate brands and add value to customers.

The industry has experienced steady growth over the past few years, recording 17% in 2017 says Jade Mathieson, creative lead and game designer at Sea Monster.

The company participated in the Make Games Africa Conference hosted in Cape Town recently, a chance for game developers across the continent to network and engage with leading thinkers.

It is a diverse space says Mathieson, comprising casual mobile gamers to serious console and PC players, and the criteria is straightforward – it depends on how much money a person spends.

"While the individual purchases in mobile and casual gaming are relatively small, they all add up. As a consequence, most gaming revenue in South Africa comes from the mobile/ casual gaming space. According to PwC, app-based social/ casual revenue accounted for 17% of total video games revenue in 2013, and 46% in 2017, with the forecast for 2022 being 70%," says Mathieson.

Beyond the consoles themselves, console gamers spend money on titles, in-game purchases and accessories. PC gamers can spend tens of thousands of Rands building the 'perfect gaming machine'.

While the stats suggest consumer-driven gaming is a money-spinner, what is the B2B link?

Essentially the industry is making money but just a fraction of that revenue goes to local developers, which is why some are focusing their attention to the B2B space.

Training and recruitment

According to Mathieson companies are using games for their recruiting process or to challenge high school learners to gain the skills required for entry into the market.

She refers to Sea Monster's 'Working at Heights VR' project as an example of how gaming is being used in training.

"Developed for ArcelorMittal, the experience is designed to test for fear of heights by exposing prospective employees to a realistic simulation of the ArcelorMittal Vanderbijlpark plant where they are taken to heights and asked to perform a series of tasks," Mathieson explains.

"Typically a company will approach us with a problem they're trying to solve, and, if the best way of solving that problem is to build a game, we will do so. These can be either once-off projects or ongoing retainer projects, with continuous updates."

Scale of ambition

South Africa's game development space is relatively small, Mathieson adds. "It tends to be more collaborative and supportive than competitive. How much a title costs depends on the scale of your ambition. If you want to make a simple web-based or mobile game, you can do so relatively cheaply. The more complex the game, the more time and resources you need to put into it."

An 'AAA' game like Grand Theft Auto V can cost upwards of US$250-million to make, she says. "Obviously those costs are completely untenable for South African development houses, meaning that local developers lean toward producing smaller, indie titles."

That doesn't mean these titles can't be well-produced and profitable notes Mathieson. "Broforce, from local studio Free Lives earned around R30-million, for example. We have world-class game developers in South Africa, they're just working with fewer resources than some of the international gaming giants."

Investor risk

Much like the scenarios built into the game titles being developed, developers are faced with several challenges to reach higher levels in the industry and achieve success.

Mathieson says games are expensive to make, and the likelihood that a game will be a commercial success in a highly contested market can't be guaranteed.

"Understandably, there are very few investors willing to take on that risk. Most countries have other forms of funding available to indie developers through government grants etc. In South Africa, we either need to try self-fund development, be very lucky, or make games for clients as a service. Because there are few local gamers that mange this – we're only able to capture a very small percentage of the local spend."

Mathieson says augmented and virtual reality are still in their infancy when it comes to game design.

"Interestingly, some of the most cutting-edge work here is being done in the B2B space as brands look to use these technologies to stand out."

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