Last week, EA was honored to welcome the German Deputy Foreign Secretary, Dr. Werner Hoyer, to our Redwood Shores, California campus. Dr. Hoyer sat down with EA CEO John Riccitiello for a wide-ranging discussion about the political and regulatory climate around gaming in Germany. The two also discussed game ratings and steps that could be taken to strengthen the game development industry in Germany.
Dr. Hoyer, who has been a Member of the German Parliament since 1987, has a specific interest in the topics under discussion because the German branch of EA is located within his constituency in Cologne.
Riccitiello started the meeting with a brief summary of the current state of the industry. He then dove into a discussion of two dynamics that are fundamentally changing gaming right now: huge improvements in digital graphics and the rapid proliferation of mobile technology and mobile gaming.
As Riccitiello explained, “People aren’t just playing on consoles or PCs anymore.” A decade ago the market for games was around 200 million people; with the proliferation of smart phones and casual browser-based games on PCs, the audience now measures more than 1.5 billion people.
Meanwhile, industry sales worldwide are pegged at approximately $55 billion, and are projected to grow to $82 billion by the year 2015; video games have out-grossed motion picture box office receipts for some time now.
Speaking specifically to the climate for games in Germany, Riccitiello noted that many policy makers hold an outdated view of the industry — one that focuses exclusively on developing content for children. What this fails to take into account is the way that both the industry and video game consumers have matured over the years — the average age for EA gamers is now 29 in North America, 30 in Europe, and 31 in Germany. While the gaming industry still needs to provide parents with tools they need to protect their children, policy makers must also recognize that video games are very much a part of today’s mainstream culture, and that the majority of modern consumers are adults.
Dr. Hoyer acknowledged that some policy makers need to be educated in regards to this shift in demographics, but pointed out that there are also many younger people in government that grew up playing games and who already understand the situation. “All this is changing quickly,” said Hoyer.
The two also discussed the relatively small number of development studios in Germany. “Germany was, at one point, more substantially involved in game development,” Riccitiello stated, “Now most of the development is concentrated in Scandinavia and the UK. I think it’s possible to see more of the industry come back to Germany. The country’s gaming sector is surprisingly underdeveloped and it doesn’t necessarily have to be.”
EA’s German headquarters in Cologne employs 140 people, and while it’s estimated that there are only 10,000 people working in the gaming industry in Germany, there are over 23 million active gamers in the country; the current market size for video games in Germany is over 2 billion euros per year.
Next, the two discussed game rating systems worldwide, including Germany’s position as the only EU country that has not adopted the pan-European PEGI system. It is EA’s view that competitive systems are confusing to consumers and inconvenient for developers and publishers who have to make content decisions for each market. In Germany, games that would receive an M-rating in the US, or a 17+ in the rest of Europe, face the threat of “indexing” — a system that makes it extremely difficult to purchase and play the game. EA believes that the complexity of indexing pressures adults in Germany to purchase games online from other markets, such as Austria and Switzerland, instead of making their purchases locally.
Hoyer stated that “negative attitudes about violence will persist in Germany but I believe in the gaming industry.” He added, “It's disturbing to have market inequities within the EU” and expressed his intent to probe the ratings issue upon his return.
When the meeting ended, Riccitiello thanked Dr. Hoyer for taking the time to visit EA headquarters. This dialogue between EA and the German government marks another step toward the creation of policies that are good for both developers and German gamers.