German Games Funding in International Comparison (game - Verband der deutschen Games-Branche)

Summary

• Almost all games funded in Germany until the end of 2022 had budgets below €10 million (99.3%), suggesting larger companies are unwilling to take the risk of developing bigger titles under the German funding landscape.p.7
• Germany's federal games funding has an annual cap of €50 million (2022), raised once to €70 million for 2023, while the comparison locations offer uncapped tax credits.p.4
• The global games industry generated an estimated €167 billion in 2022 and revenue is forecast to rise to €192 billion by 2024.p.15
• The number of companies in the German games core market rose by 41% from 2020 to 2022, to 878 companies.p.22
• The German core market employs around 11,800 people.p.25
• Revenue from in-game and in-app purchases in Germany grew from €2.38 billion (2019) to €4.46 billion (2022), by nearly 90%.p.21
• With the funding cap, a maximum of eight €100 million projects could be funded simultaneously within one year.p.7

Key insights

1. Direct personnel costs make up around 54% of a game's total budget, indirect personnel costs about 13%, and other expenses up to 33%.p.12
2. Tax credit rates in the comparison locations include 37.5%, 35%, 32%, 34% and 30%, versus a capped fund model in Germany.p.4
3. Around 67% of all German games companies are based in Bavaria (181), Berlin (163), North Rhine-Westphalia (139) or Hamburg (104).p.25
4. 88% of all German games companies have fewer than 20 employees, and large companies with at least 100 employees make up only 2.5%.p.22
5. By mid-2023 the number of companies had risen to over 900, an increase of 46% within three years.p.22
6. Domestic developers account for only 4.2% of total games trade revenues in Germany (2020).p.24