Games are popular across the Middle East; from consoles to mobiles, the region’s youth are tapping away scoring points, navigating their way through first-person shooters and tilting their phones to race.
According to data from Abu Dhabi’s media free zone authority twofour54, the gaming sector in the Middle East and North Africa (Mena) region is growing faster than the global average, outpacing Russia, China and even South Korea and is set to triple in size to US$4.4 billion by 2022. PwC, however, has a more conservative estimate for the growth of the market.
“Globally, the entire videogames market will be worth $93bn by 2019. In Mena, it is smaller at $1.76bn, but it is growing at a faster pace than the rest of the world,” says Philip Shepherd, a partner at PwC.
The sector presents a lucrative opportunity for advertising and subscription revenue and various institutions are now pumping money into creating an ecosystem for mobile and console gaming as a means to create a more local market.
Leading the way is twofour54, which has established a games academy to train local developers and cement Abu Dhabi as a regional centre for content creation for the sector.
“The majority of gamers spend time downloading free-to-play games [apps] but start paying, via in-app purchases, once they are immersed in the game,” says Maryam Al Mheiri, the chief operating officer at twofour54.
“Games like Candy Crush Saga and Game of War generate around $1 million a day in revenue. In this region, consumers will increasingly expect international players to Arabise their content. These figures start to build a picture of the market opportunity in the region for gaming companies.”
Development in the region has taken a two-pronged approach – there are those who prefer to develop their own games, tailored to the local market and drawing from narrative threads of the region, while others prefer to localise global games.
“A mixture of both would be the best way to go,” says Mohammed Al Shawwa, a research manager at Arab Advisors.
“[Localising] has proved successful for a number of games, especially due to the fact that the content of the game is localised and does not contradict norms and traditions of the region, in addition to some of these games being international ‘hits’ that are of high quality.”
But these games have not been developed with a regional focus or audience in mind, so there is a market for locally produced content.
“And this is where regionally developed games can excel – by developing games that, from inception, are based on the culture of our region and on matters to which the Arab player can relate,” says Mr Al Shawwa.
The argument in favour of developing games locally is the control that the region can have on the narrative of the games and the characters within them.
“It will definitely have a positive effect, especially on young children here in the region,” says Mr Al Shawwa. “Moreover, Arab players will be able to relate more to a character that shares their background, as they feel that they are similar to them.”
But there is still a long way to go. Pay-to-play offerings are still quite under-used in the sector. In Egypt, 30 per cent of internet users are regular online gamers, but just 5 per cent pay for them. In the UAE some 17 per cent of those who play games online pay to do so.
“The ‘freemium’ model is dominant in the region,” says Mr Al Shawwa. “Gaming companies need to get a huge base of players in order to be able to generate revenue streams that would be enough to sustain their business.”
The number of mobile gamers has grown substantially thanks to the adoption of smartphones across the region. The UAE has the highest smartphone penetration rate in the region, at about 80 per cent.
The Arab Advisors Group has conducted a number of surveys focusing on mobile applications in Jordan, Egypt and Saudi Arabia in 2014 and 2015. Part of what the surveys covered was the amount of time mobile application users spend playing mobile games. In Jordan, about 47 per cent of the respondents who play mobile games spend between one and three hours a day doing so, while some 33 per cent spend less than an hour a day. As for Egypt, 71 per cent of mobile game users spend between one and three hours playing games on their mobile, which is similar to Saudi Arabia, at 74.2 per cent.
Currently, mobile games, played on tablets and smartphones account for a third of all global games, but that is set to grow to half in the future.
“The Mena region has the highest mobile smartphone penetration rate in the world and the mobile market is growing year on year,” says Ms Al Mheiri.
There are close to 530 million mobile phone users in the Middle East with an overall smartphone penetration rate of about 39 per cent.
Twofour54 has developed a programme specific to the gaming sector, attracting eight gaming companies, including Ubisoft, to its campus to develop games for the region and the wider market.
Ubisoft set up in Abu Dhabi in 2012 with a strict global outlook and now employs 60 people in its studio.
“Our main goal is to develop for the global market, that is one point we stress – our focus, development and vision is for a global audience,” says Yannick Theler the managing director of Ubisoft Abu Dhabi.
Since its arrival, Ubisoft has worked with the academy and local producers and designers to create its first game for mobile – CSI Hidden Crimes, an online free to play game.
“It was really interesting and challenging for the new team. It was the first project for the studio and for the majority of employees – it was the first time they were developing a game and the first time developing for mobile,” says Mr Theler.
Since the launch in May 2014, the game has racked up close to 30 million global downloads and won several international awards, making it one of the most successful mobile apps fully developed and produced in the Arab world.
While the region has yet to produce a game that rakes in billions in revenues, there is now the potential and ability to contribute evermore positively to the sector.
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