Could this rising sector be the industry's most significant new market? Develop investigates
The Middle East is a misunderstood region. The national newspapers would have you believe it’s a place defined by bloodshed, civil unrest, religious fervour and terrorism.
Even the most liberal minded of those from outside the vast geographical area that stretches from Northern Africa to Western Asia can find it hard to shake from their minds the clichés that thousands of reels of television footage have etched into the conscience of the Western psyche.
It’s certainly a place with its fair share of problems, but the reality for hundreds of millions of its residents isn’t as alien as you might think.
Technology in many parts is just as prevalent as elsewhere, to the point that smartphone penetration in the United Arab Emirates alone has reached a staggering 200 per cent.
Across the pan-Arab world 60 per cent of the population is under the age of 25, and subsequently the appetite for mass media culture is near insatiable.
Countries like Dubai are awash with investors, and in spite of the regimes that caused the Arab Spring, there are open-minded governments with a view to welcoming Western culture and industry.
And yet the games industry in the area is only just beginning to blossom.
UNITED THEY STAND
“In the area there is a huge interest in video games, and a huge market. For a long time there have been a lot of people in the region that love games and want to develop them,” confirms Yannick Theler, general manager of Ubisoft’s new Abu Dhabi studio.
Theler, a ten-year Ubisoft veteran who first joined the company at its Swiss studio, is undertaking the huge task of establishing and building an enormous development team in the largest city in the United Arab Emirates.
And he isn’t afraid to admit that – despite the opportunities available – building a games industry in the Middle East is going to take a monumental effort.
“Until now people here interested in making games only had two options. They could either leave the area and go to the US or Europe, or, more often now, they could try and set up with other people and try to make those games. The second option, though, left them lacking in expertise. It was very hard until now.”
Fortunately for Theler and the other pioneers taking a bet on the Middle East’s games industry, an ambitious media hub centred in Abu Dhabi City has been conceived with a view to establish the area, and wider region, as a globally relevant destination for games development, TV, film, animation, and numerous other industries.
“For whatever reason historically there hasn’t been the infrastructure here in the Middle East, but there’s a huge effort to change that, which is something TwoFour54 is doing here in Abu Dhabi, but to serve the wider area,” says Wayne Borg, COO of TwoFour54.
“We want to build that hotspot that attracts young creatives, whatever field they are in, and is seen as a place to come where you’ll find support, infrastructure, and a community of people that understand what you are doing. It’s a place that’s conducive to and supportive of producing great content.”
For now the focus in building the region’s industry to a globally relevant size focuses on creating culturally relevant content for the Middle Eastern audience, be it through culturally reappropriating triple-A IP from the rest of the world, or creating original IP and content targeted exclusively local tastes.
This is something TwoFour54 is devoted to, and a specialty the likes of Abu Dhabi studio Jawaker excel at.
Jawaker, however, isn’t afraid to admit more far reaching ambitions, and refuses to limit its horizons at the geographical and cultural boundaries of the Middle East.
“We focus on building card games for the Middle East and North Africa region, and currently have 13 of the most popular ones on our website, but our infrastructure is quite flexible and we could consider expanding globally in the future if we deem the option feasible,” explains Ahmed Abdel-Yaman, operations manager at Jawaker.
Out of context, a confident developer with far reaching plans isn’t that uncommon. But the idea of a future where games built within a Middle Eastern cultural frame of reference permeate the global games industry could lead to a thrilling diversification in the themes and experiences Western players can access.
“The culture is quite different here, and that could mean that with the operation we have here we could see, in a few years, some very different new ideas and new perspectives on design that could reach the rest of the world,” offers Ubisoft’s Theler. “That is a very positive thing indeed.”
“Many of the companies working here are looking at Arabic content, but there’s an international viewpoint and international content is very much on the agenda,” adds Borg, who believes that the more the area can internationalise the more it can take advantage of being connected with the knowledge and skills of the rest of the world.
“We’d love to encourage the spread of this content globally,” he continues. “For us the ultimate signature of success would be that content conceptualised and created here would be exported to the rest of the world.
"I don’t think there’s any reason that this region can’t participate in a process that exists across much of the rest of the global games industry.”
Of course, where there is so much opportunity there is also a great deal of challenge, and the companies across the region are happy to admit they have a long way to go.
“It is not easy to find the right staff, as the region lacks the educational programs in fields such as sound engineering, animation and game level design,” says Mohamed Sanad, marketing executive at Egyptian studio Nezal.
“We have to find some passionate people who are self-learned by reading some books, watching videos and so on.”
TwoFour54’s new Gaming Academy in Abu Dhabi City serves as part of the solution to the lack of suitably experienced local talent (See ‘Develop Like an Egyptian’ panel, right), and sets the United Arab Emirates metropolis apart as a leading destination in the region.
However, many more similar games development savvy educational establishments will be needed to satisfy the wider area.
And then there’s the no less important matter of generating revenue from the games, publishing and distribution models most suited to the Middle East’s unique make-up.
“One of the biggest challenges we faced was monetisation,” explains Jawaker’s Abdel-Yaman.
“Credit cards have low penetration rates and most people in the region don’t trust using them online yet. Other solutions suffer from low regional availability, impracticality, or large fees, forcing developers to implement and maintain a large combination of solutions.”
Furthermore, some say investment and understanding in the commercial worth of the games sector locally has a way to go.
According to Robert Fisser, Sony Computer Entertainment Europe’s vice president of sales and commercial development for the European, Middle Eastern, African, and Australasian territories, the status of some elements of the industry – in investors’ minds at least – need reprioritising in the Middle East.
“The region does not see the level of investment that could be justified,” he says, going on to offer examples of areas that need to be recognised as warranting a greater emphasis when cash is divided.
“Marketing budgets, events, and company headcounts come to mind.”
REASONS TO BE CHEERFUL
Others, however, are upbeat about the changing attitudes of investors, and are confident that not only cash-rich UAE businessmen are stepping up to support games with funding.
“There’s a lot of gaming start-ups here locally and we’re even investing in some of those start-ups,” insists Borg. “We’ve just invested in a couple such as Jawaker.
“For young start-ups here there is a lot of activity in the gaming space, and I think, certainly from a global investment standpoint, they can see some of the world’s leading games companies making an investment and establishing a presence here, and that’s a testament to the viability of the games industry in the region.
"I believe there’s a lot of investment interest in the opportunities here, both for investors locally and globally.”
Furthermore, in the United Arab Emirates, developers almost without fail speak warmly of the support they receive from trade bodies.
The authorities realise the potential the industry has to bring more money into the area, and provide a wealth of support for international companies looking to establish themselves in the region.
And unsurprisingly, it is again TwoFour54 that is setting the standard in supporting and facilitating investment from overseas.
“The Government of Abu Dubai, through TwoFour54, is looking to develop many different industries here, including an international media hub,” asserts Theler.
“They are putting a lot of energy, expertise and effort into this. They are a huge help to companies thinking of coming here to make use of the potential here.
"They helped Ubisoft a lot with finding a location and sorting out visas. We are very well supported, and very well welcomed.
"There is so much enthusiasm from people here; from small companies and then people like Sony. There is excitement and people are motivated. It’s been a very positive surprise.”
And in an incredible twist, even the inspiring, often distressing events of the 2011 Arab Spring have helped games developers.
While the global games industry pales in comparison to the significance of the events that toppled dictators throughout last year, there has still been a positive impact on the fortunes of the area’s up-and-coming developers.
“I think Facebook’s decision to add Arabic language boosted the social games market as the Arabic users are increasing steadily,” says Nezal’s Sanad, before delivering an insight that is quite remarkable.
“The other thing that helped us was the revolutions in the region, that made many people join Facebook and see what the tool is that helped people in revolution.”
Civil uprisings, it turns out, can also offer a way for consumers to discover new gaming platforms, and the Middle East is a place where that has already happened.
And with money, enthusiasm and a huge market fuelling the booming Middle Eastern sector, things look set to keep getting better.
Develop Like an Egyptian
While Abu Dhabi is the undisputed king of Middle Eastern and North African games development hot spots, other hubs are springing up in the least obvious of places, and serve a growing audience.
Mohamed Sanad is marketing executive at Egyptian studio Nezal, and he has been telling Develop why the region has emerged as one of the world’s most fascinating games development destinations currently active.
What makes the Middle East a great place to make games?
I believe that Middle East and North Africa market is a blue ocean, but it is largely underserved when it comes to original gaming content developed specifically for it, as almost all games are translated into Arabic from famous games in the US or EU.
There are not many games that use the regions cultural elements that make the player feel at home. The market has shown great capacity and is growing steadily.
What are the challenges faced as a developer in the Middle East?
The main challenge is to find and attract the required talent. The other challenge we faced was the market data and statistics. There is very few, if any, information about the social gaming market in the Middle East.
What are the area’s key strengths?
Basically, the lower salaries in Egypt compared to other places like the US or Europe make the development costs much lower.
Are their good quality educational establishments relevant to games development in Egypt?
Not at all. There is not a single place in Egypt to teach you game level design or sound engineering; you need to learn this by yourself or pay tons of money to join an institution in Europe or America, if you are interested in such field.
It is also hard to find a good animation studio to teach you game animation. Most of our employees in these areas specifically are people who have passion and went a very long way to get the required knowledge by themselves.
What advice would you give to a young developer considering setting up a studio in the Middle East?
My advice would be to not copycat other global games and try to come up with ideas that fit the cultural elements of the region.
Another piece of advice is to work hard to find the good talent that fit in with games development. You have to be a gamer. It will be easier if your employees are gamers.