Full Transcript for Is the UK Gaming Industry Falling Behind? Why Mobile Games Deserve Better | Smart & Wright Ep9

but quite frankly, I I feel like especially in mobile, people look at us a bit like a joke. and we need to correct that. And I am definitely gonna fly off the handle at one point today and and rant about the current state of the the bodies of the Georgia speaker-0: Already. speaker-1: But anyway, Adam, what what was in the budget, mate? What changed? speaker-0: It's like it's like triggering you. I like this. speaker-1: Yeah, I I'll get very passionate about this subject. speaker-0: All right, so I got I got a few bits. I'm gonna read it. I'm not gonna pretend like I'm not reading it. I am reading it. first, the UK government is recognizing that development incentives need to evolve. Hell gaming is evolving quicker than anyone thought. Just look at our previous episode on AI jailbreaking consoles. You can see that it's evolving pretty quick, like by the day at the moment. games are no longer simply products that are developed, launched, and finished. live service, ongoing content, development and community operations are increasingly important parts of the business now. I mean that's that's kind of just saying that catching up with the rest of the world and and also mobile. Like I mean to me it feels like before I go on to the second point, it feels to me that mobile, if anything, is an afterthought to to government to any of these organizations, it feels very much that it's about the creative view of things, the the you know, the the the Oscars, the artistic, the the this is this is the the creative part of what we do. which of course it is, but there is creativeness in mobile games too. and I do think absolutely when you look at countries like Turkey, which is the prime example of the moment with how the government is embracing gaming and really pushing very hard on behalf of gaming, you can see the difference that that makes to a lot of the companies and how they're they're flourishing at the moment. speaker-1: Mm-hmm. Yeah, agreed, mate. Agreed. I think mobile, as we all know, is the larger part of the revenue profile of gaming as an industry, right? Mobile does make more money than PC and console combined. We also know that gaming is bigger than sports, music, and movie combined. So what we're saying is the biggest segment of entertainment revenue globally, over all of the art forms, is mobile gaming. And yet speaker-0: It's not you look at you look at the pressure. speaker-1: Numbers are sexy. Numbers are sexy, you're right? Numbers are sexy, but sexy. speaker-0: It doesn't come across that way to the press. You look at any gaming press, apart from perhaps Neil, you know, they're they're they're not speaker-1: Yeah. speaker-0: mobile focused at all. Like you know, they they don't focus on mobile pocket pocket gamer Neil stuff. There there's slight exceptions. But for the majority, there's no sort of mainstream mobile news. It just doesn't happen. speaker-1: Yeah, and and and look I get it, I get it, there's a lot of I think in the UK especially, 'cause we were at a mature gaming market, right? we've been making games here since the seventies, right? and obviously I I worked at Quali and and David Darling, my old boss, you know, he was creating, you know, games in the speaker-0: interview him. That that that's such an amazing story. speaker-1: look, very, very, very smart man. him and his brother were making two million a year at twenty in the late seventies, right? And two million a year in the late seventies, we're talking by today's standards, I don't know whether it'd be fifty million between two of them or something like that. speaker-0: Well as some of the games which moulded my upbringing. speaker-1: Yeah micro machines, man. Micro machines, that was David's but but we we have a very mature gaming market, mate. There are people who have been in gaming for forty years in the UK, right? Of when we can we can and that is tremendous. I'm so proud of our country when it comes down to our history. But I feel because of of a long standing history, we are slower to move forward, right? speaker-0: This happened this happened years ago with the internet, right? Companies like Woolworths they went under. that was a high street staple, everybody as a child can grow speaker-1: They can mix. speaker-0: It was amazing. They went under because they didn't adapt to the to the new world. Now it feels like the entire UK gaming industry isn't adapting to the new world. speaker-1: Yeah, I just I I think I think ultimately there is i is is a couple of things why I think it is, mate. One, it's the people in the the entities. So you've got Tiger, you've got BAFTA, you've got UK, and these three, you know, organisations, they are predominantly run by people that come from 30, 40 years of gaming experience. So mobile was not on their on their list, man. they come from they come from PC console. So they know how premium works, right? They know, okay, this type of game is indie, you sell for this price point, you sell on Steam, you sell in store, they understand that part of the entry massively. But but again, times have moved on, right? And what we're seeing now is over the last fifteen years, mobile has become the biggest part of the pie. And now we're also seeing the evolution of AI centric games. And and a lot of these people are a little bit living in the past. And I hope that each of those three organizations that I've just mentioned and and look, shout out to Tony Clark, BAFTA, Google, you know, X PlayStation. Tony is, you know, he's pushing stuff forward. I you know, I really like what he's doing. But and also, you know, Nick Button Brown and and some other people are trying to generally push stuff forward. But I still feel like I still feel there's, you know, some some people holding it down and and they want us to focus on on PC console because they believe it's this, artistic, artisan, like, it's uber creative, like things we can be proud of. and and for me in particular, Adam, like,

yeah, like w if would I be as proud, more proud, or less proud, launching a game on console, which I have done, or on Switch, which I have done, or on mobile, which I've done many times For me it doesn't really matter. yeah, maybe if I could work on a game like Ghost of Jeshima, Ghost of Yotai, which is visually absolutely incredible, right? Like there is there is something absolutely beautiful about those sort of games. But at the end of the day speaker-0: Is that is that where the is that where this distinction lies that mobile isn't real gaming? You know, I've heard I've heard that quite a few times over the past and you go I I went to the UK event last year and you you know there's there's the majority of the building is is PC console and then there was the the one room in the basement that was talking about mobile. Now like I understand the it's not as sexy to talk about. You know, it i i someone at GTA it's someone at Rockstar sneezes. And that's in the news, but it it's it's not the same for the mobile side of the business and I get that. But that that works for the mobile side of the business in some ways as well, of course, because it's not covered in mainstream media. speaker-1: Yeah. It's it's two billion in development projections, like which I've seen, right? speaker-0: But it's non comparable to anything else. speaker-1: No no but but let's okay, let's let's let's look at this. Let's break it down very simply, right? GTA six is about two billion in production, right? And maybe maybe it will do two and a half to three billion within a certain time frame. I don't know what it will be over lifetime, mate, because GTA five is still selling units now, right? Shark cards are still being sold now. speaker-0: I was gonna say I'm the currency, yeah. Yeah, yeah. speaker-1: So I don't I don't actually know how much GTA V has made over its lifetime, but the fact is they keep reselling it, and the I think one of the reasons they they pushed GTA six out was because they didn't want to affect GTA V, which is still such a cash cow. But they're say, if we compare GTA six that costs two billion in production and maybe makes three billion in the first year or two, then we then we look at Royal Match, right? Like the production cost cannot be more than a few hundred million and it's been going for a number of years and that game is making billions, right? So Royal Match, as a match free game, will probably make equal or if not more than GTA six. So is there is there not something truly magnificent about that? Like is there not something incredible that more people will play Royal Match than GTA 6? Like the accessibility to it, the amount of people that play it, like The the Dow of these games or the the people that will have download these games will be more than people that purchase GTA six for hundred dollars. So speaker-0: Well, it's accessibility, isn't it? it is accessibility for sure. There's so many more mobile devices than there are games consoles. That's that's speaker-1: But but mate, it still doesn't change the fact to me that, more people, more average people, right, are playing mobile games. Therefore, it needs some damn respect on its name. these organizations, again, we were just looking at the Tiger Awards, or I was just looking at the nominations for the casual game of the year. There's not a single mobile game in there, Adam. you're telling me there's you're telling me that there's no no casual games on mobile that d deserve to be on on that list as casual games on mobile are is much bigger than casual games on PC console. you're crazy, mate. You're crazy. what are you doing? What are you doing? Whoever's running Tiger, give me a phone call. I I'll give you some selec I'll give you some names for next year. speaker-0: Well let's do that. all right, I'm gonna go back to reading. Secondly, we have finance is becoming a central concern. Between the proposed scale up and fund and IP back lead lending and increased tax relief, there's clearly an effort to address the difficulties studios face raising money. I think one of the biggest things for me is really the the obviously I come from that side of the business, but is the user acquisition costs. And if you look at what Turkey's doing in giving giving relief where it actually matters for growth, for very fast sustained growth, that is probably one of the best things that I've ever seen a a country's government move into. really sort of knocking off fifty percent off of user acquisition bills, platforms, SaaS providers. I I think speaker-1: Deductions on rent. Yeah. speaker-0: It's it's phenomenal. It gives the opportunity to to a speed boost. You know, the we we talk about incubators for for entrepreneurs and stuff. That's probably one of the best the best forms of incubator you could possibly make ever. speaker-1: Yeah, exactly, man. And and look, the the Turkish government are just so smart when it comes to this stuff because effectively what they're doing is they're helping studios get from zero to one, right? Which is the hardest part. And then the idea is Exactly, speaker-0: Moved when they get to a certain size, I think, isn't it? speaker-1: exactly. It's all it's all capped to a certain size. So when when they get to a point where the studio can stand on its own feet or it's in a high growth mode, right? Then then obviously the Turkish government will eventually get paid. millions or hundreds of millions or tens of millions in tax through the transaction, right? If they if they were to, you know, Loom games, for example, selling to to what was it, Scopley, like, you know, the government's gonna come and get their pound of flesh then and they obviously helped them out in the beginning. But they're gonna make so much money because they're helping companies get to that point. It's speaker-0: Yeah. Exactly. speaker-1: the hardest thing, man. The hardest thing is going to zero. speaker-0: Everybody at the end of the day.

it especially with grows the entire economy. speaker-1: You've got you've got understanding as well. V C money is not as accessible. It's nowhere near as accessible as it used to be. So you can't go like I remember four or five years ago, Adam, you could go with a deck. no no game. Just a good team and deck and you'd get five million. Now that just doesn't happen. that's speaker-0: Well especially if you had a an X an X scopey an X. speaker-1: You're a secondary, etc. blah blah blah. But that doesn't happen anymore. So so but basically all of these new studios, they're told you have to bootstrap. And bootstrapping's really hard. Like if you don't come for money, you've not had an exit before. You don't have the funds to put twenty K burn into a studio for two years. Like you know, who's got a quarter of a million dollars out of their own pocket to to do this stuff? Yeah, yeah. for you know, for a year. And and yeah, so so the the government No, so basically more people or less people, sorry, are founding companies, which that is bad. we need more entrepreneurs. We need more people creating businesses. We need Europe to grow. not just in gaming, but across most a lot of different sectors. So, you know, the the government need to get better and it's not just about also kind of saying these things, it's about making it easy enough to to to so people can do it. Right? Yeah. So if you say, like speaker-0: There's also one thing one thing somebody was telling me the other day, one thing about the Turkish initiatives they they give the the sort of the refunds or the rebates at the end of the month. Like it you don't have to wait till the end of the tax year to yeah. So when obviously when you're spending out on user acquisition and you're waiting three months for that for that return to come back, speaker-1: That's speaker-0: you have the ability to keep moving. Which I think is one of the biggest issues that we face in the UK at the moment is that you have to wait a year in order to be able to get any tax rebate. speaker-1: Yeah, it's it's a real problem, man. Look, cash flow is is the lifeblood of businesses at the end of the day. And, you know, if you it's the same with scaling UA. If if you haven't got it, you can't spend it, right? So even if you say, my PL T V at day three sixty is X and that r that results in a hundred and thirty percent ROAS, if you don't have it in the bank in month zero, then you can't spend it. Right? So this is why UA debt financing is in and has become so popular, because it helps that And ca it helps improve cash flow. And we ourselves did a deal with Metica at the start of the year and that has helped speed things up. And if you're if you're fortunate enough to have a game that's profitable, I strongly advise you to look at UA funding, right? Because it's US speaker-0: I would I would say you as long as you understand, as long as you understand the the risks that are associated with it and the return, you know, the how your game's gonna perform, you you have to have a good understanding of that. speaker-1: better than giving up twenty percent a year for speaker-0: A hundred percent. speaker-1: five million, don't be wrong, there's there is differences. Sometimes you need like obviously f in our case, the money is only going towards UA, right? We can't like take money from them and use it to on salaries or scale the team or whatever. So sometimes, you know, in the in the beginning you can't can't do that. Your game's not profitable. You need the money to be spending on other things, etcetera etcetera. So so you have to raise money, right? And and V C exists in in every sector for a reason. but but yeah mate it's it still comes down to the fact that you know we as a country and not and again not yeah I would even just say this about UK, I think Europe in general as well. Like we we need to be better, like you know, Finland has business Finland and they do investment matching. So you know if you raise like 150 angel Rand, business Finland will double that to three hundred, and that's amazing, right? That's great, but you still need to get the hundred and fifty first. speaker-0: Yeah, you've still gotta get there in the speaker-1: So so like I I do feel like there has to be some some government level improvements if we're gonna see the same level of success as what Turkey has done from from the top down, right? speaker-0: I don't want this to just be slagging off the UK games industry 'cause Yuki and Tiger do some fantastic stuff as well. And one thing that I've really liked recently is the partnership with Discord. I think that is very interesting because it acknowledges that helping studios make games isn't enough. And one of the biggest problems is discoverability. Yeah like They obviously starting to understand this. My my only concern is the Discord is more angled towards PC console just by its very nature. By nature. Yep. So again, it's still it's still that side of the pendulum, but I would really like to see that sort of becoming more and more of a thing and and linking with lots of different providers rather than just Discord, but and trying to like just Think a little bit about the mobile side of the business. speaker-1: Yeah, like I said, mobile needs more respect on its name. It's very frustrating as me who has spent ninety percent of my career in mobile and I have had stints in in PC console. My I started in PC console and when I was a quality I worked with alongside Ben Forrester who was VP of of PC Console and I've invested in PC console company. So I've got I've got some some stake in that, but it's just again, it's just quite depressing, mate, that the the larger industry and the bigger and again it's not just not even just our own local organizations. I think if you look globally at them, if you look at the big gaming award ceremonies, they're you know they they're only putting up numbers of of of PC console games and and mobile doesn't get the

respect it deserves. Even though as we already discussed, it's making more money, more people are playing it. You know, yeah it's it's it's very frustrating for me because my whole thing has always been I want as many people playing our games as possible, right? Like we build games because we love games and games create a positive emotional response with people's lives. peop it's an enjoyment thing. So for me, I want more people playing than speaker-0: matter. The graphics don't matter in that. speaker-1: Exactly. speaker-0: Or do you think they do? Sorry, I I'm putting words into mouth. speaker-1: Look mate, I think I think it's horses for courses. I think if look I I play much more mobile games than I do console, right? And I have I'm a PS five player, I play FPSs, I play RPGs, whatever. I play the big big titles. But I spend more of my time playing mobile games and is th the level of enjoyment speaker-0: It does we're old though. in terms of in terms of it's easier to speaker-1: I w I wish I had more time to speaker-0: play on the iPad or the phone than it is to to get in front of the C V sometimes. speaker-1: then arguing mate, like you said, it's I I play a lot of Pokemon like trading card pocket right and it's been out for two years now it's done over a billion in in revenue right and I've spent hundreds of pounds collecting all of the cards. So since it started two years ago I have collected all of the cards basically I've spent fortune, over a grand probably doing that because I want to do that. I love collecting things as you can see from my shoes. So So I'm perfect. I'm a a perfect person for that for that. And aga again, thirty years the thirty year anniversary of Pokemon and I I'm at thirty nine years age. I remember when Pokemon came out, it was a massive, massive thing in my life. I collected all the cards, I was into the TV show, mate. Me and my kids watch it. and so, I've spent more on mobile than I have on PC console in the last five years, right? Yeah. I've played more mobile than I do PC console. And quite frankly, I get the a similar level of enjoyment. I would say probably a slight more enjoyment playing PC console because of the type of experiences you have, right? And storytelling and and and all of the escapism that comes with that. But equally, I'm getting a lot of fun. I made really enjoying playing Forex on mobile or collect T C G's on mobile, mate. So so for me speaker-0: Yeah, yeah, agreed. I mean what would I I'm I'm kind of interested to get your thoughts on like what if you were in that position, what would you do right now? speaker-1: Honestly, I would look at whoever the the kind of the boards of these companies are, mate, or the elected committees, and I would say, like, how does like look at the profiles of these people? If there's ten people there, how many of them are coming from historical PC console, right? How many of them were were you know working at Team Seventeen thirty years ago? Right? Yeah, yeah. And and and like how many of the people in the in that committee are people that have successfully launched games in the last ten years, if so what games they are. Is mobile a component of this, right? And I do think there needs to be diversity on these panels and it not just from, you know, male, female, whatever, like diversity in the in the type of games, the genre of games, the the and the what speaker-0: Yeah. speaker-1: I think I think These companies need to the next time they do these 'cause if if you've got ten people who only know PC console making all of the decisions, you're not going to get consideration on mobile. No. So speaker-0: Course speaker-1: so I think all of these and again I I shout out to to Tony Clark and and Nick Button Brown because they're involved in some of these organisations and I know they're trying to make changes and it's it will take time, but quite frankly they need to hurry the fuck up and get more mobile people involved, or I'm gonna start ranting. Again. speaker-0: We do like a good rant from you, Justin. speaker-1: I I do mate. I fly off the handle, I'm easy. speaker-0: Cool. Well we should probably leave it there before we get into any more trouble. Fab, thank you very much. Speak again soon.