Unleashing the Potential of Portugal's Game Development Sector

The Portuguese gaming industry made a significant impact at the recent GDC event, with over 50 delegates from 20 companies in attendance, 14 companies represented in the country's pavilion, and a reception welcoming over 100 attendees. This reflects the country's upward trajectory in the gaming sector, further evidenced by the opening of a games-specific co-working space in Lisbon. The Gaming Hub aims to become a focal point for innovation, collaboration, and growth in the gaming industry, both in Portugal and beyond, according to Diogo Rato, Executive Director of the Portuguese Game Developer Association. In an interview, Rato discusses the impressive growth of the industry, citing official public data that shows a year-over-year increase of over 20% in the number of studios since 2010, and a 33% increase since 2018. Revenue has also seen significant growth, with a compound annual growth rate (CAGR) of 41% since 2010 and 63% since 2018. The official turnover in 2022 was over €38 million, with the number of people working in the game industry growing by approximately 53% each year since 2018. Portugal's gaming industry has its roots in indie development, dating back to the 1980s, with notable examples including Elifoot, one of the first football management games, developed for the ZX Spectrum. Miniclip's establishment in the country in 2010, ahead of the release of 8 Ball Pool, had a lasting impact on the industry, with an increased number of professional developers contributing to games such as Under Siege, MotoGP 13, and Quest of Dungeons. Since 2018, Portugal has experienced unprecedented growth and innovation in the gaming sector, with notable developments including the launch of Doppio, an AR-focused studio, and the acquisition of Bigmoon by Saber Interactive. In 2022, Miniclip moved to a new office with a team of 350 employees, making it the company's largest operation globally. The APVP was founded to contribute to the sustainable development of the local game industry, with Rato highlighting the diversity of the industry, including game tools providers such as Didimo, Anybrain, and Sound Particles. Although the Portuguese industry is not yet as established as its European counterparts, it has grown significantly in recent years, with contributing factors including the country's quality of life, high English proficiency, and the quality and number of engineering graduates. Portugal offers a strong foundation for attracting talent and establishing new game studios, with the country ranking 14th globally in Kearney's Foreign Direct Investment Confidence Index. The country also provides an entry point to the European market for other Portuguese-speaking countries, representing around 260 million people. However, the industry faces challenges, including a shortage of senior-level professionals and limited government support. The Portuguese government offers some support, including grants and subsidies for hiring young graduates and a tax credit of up to 80% for R&D expenses. Nonetheless, game developers in Portugal lack public fiscal or financial incentives specifically tailored to support game development productions, unlike some other European countries. APVP is working with the local administration to explore the implementation of such incentives. The industry also grapples with typical challenges present in many European sectors, including taxation. However, with the industry expanding and collective efforts tackling these issues, it is anticipated that these hurdles will be overcome. The opening of the Gaming Hub in Lisbon is expected to address some of these challenges, providing a space for startups and studios to scale and create synergies between mentors, investors, and other companies in the sector. The hub includes 12 private rooms and 12 coworking spaces, with Fortis Games as the anchor tenant, and is seen as a catalyst for growth, bringing together talented game developers and fostering collaboration. Looking ahead, Portugal's rich culture represents exciting prospects for the gaming industry, with game development education at universities expected to lead to a fresh wave of skilled young talent. In 2023, Pole To Win announced plans to open an office in Braga, creating 60 jobs by 2024, and GlobalStep is set to open a new location in Portugal. With the increasing number of companies contributing to the ecosystem, more businesses are expected to set up studios and establish new headquarters in the country. Efforts by APVP to organize and host B2B events, such as DevGAMM in Lisbon and Gamiberica's first edition in Porto, highlight the vibrant and lively community. These initiatives provide a platform for industry professionals to share ideas, foster collaboration, and exchange knowledge, contributing to a thriving environment for the industry to grow. In conclusion, Portugal's video game industry has witnessed significant market growth, from a total turnover of €5.5 million in 2018 to close to €39 million in 2022, underscoring the industry's resilience and the country's dedicated efforts to expand in the video game sector.