Who is shaping the Turkish gaming industry?

Saw this, played that and developed it...

This article was published on October 22nd, 2017 in Bloomberg Businessweek Turkey as part of a piece titled “Who shapes the gaming world?”. You can read Bloomberg Businessweek Turkey via Turkcell Magazine (Android and iOS).

Computer games have garnered more and more attention in the recent years. Although eSports has a long history in Turkey as well as in the world (Turkish teams and players were attending World Cyber Games events in the early 2000s), it has taken many years for a wider acceptance. We are at a point which my friends who had dreamed of going abroad by playing games back in the day had foreseen. Many Turkish eSports teams were founded by people who were active in the dark years of eSports in Turkey. eSports came to the forefront with the investments of big companies especially Vestel and Vodafone. Bahçeşehir University, which is the pioneer in this prospect, established gaming laboratories and game development departments; and sponsored an eSports team.

However, the eSports became an advertising channel in the grand scheme of gaming. The whole genre is a very small part of the gaming economy. Game development is a bigger economy than eSports. Especially the mobile gaming reaching to non-gamers, made the power and the volume of the game development bigger. Nowadays, a high school student developing and monetizing a mobile game is in fact quite ordinary.

It is a fact that the economic researches on the rapidly growing gaming sector are also in their infancy. There may be some contradictions between the data of companies such as SuperData and Newzoo in this regard. The reasons for this are an already huge sector growing steadily, the companies not disclosing profits, and hardware categorization difficulties (eg there’s no such thing as a game processor, in the case of the desktops and notebooks, generally expensive and fast components are regarded as gaming products). According to these researches, the retired people playing Okey or Candy Crush on their iPads at home, younger people who spend real money on the Clash of Kings are also considered gamers. According to Newzoo’s research, the share of mobile and tablets has increased to 42 percent. On the other hand, consoles have a share of 33 percent, desktops and notebooks have a share of 27 percent.

According to SuperData’s research, eSports economy, which is 892 million dollars worldwide in 2017, is expected to reach 1.1 billion dollars in 2018 with an increase of 36%. Apart from tournaments, prizes and sponsors, amateur tournaments and betting sites are also a part of this economy. This year, 213 million people are watched eSports and in 2019 this number is expected to reach 300 million.

By contrast, the game industry across the globe is an economy that exceeds 100 billion dollars in size (Newzoo research). According to SuperData’s research, the game market in the world only reached 7.9 billion dollars in August, growing by 11% compared to the same month of last year. In the same period, the number of people using platforms like YouTube and Twitch to watch games was 665 million.

While many people think about eSports when the gaming sector is mentioned, it in fact constitutes about only one percent of the whole business. The gaming revenues are entirely in the hands of developers. According to TOGED (Turkish Game Developers Association), 90 percent of the games developed by Turkish companies are sold abroad. Turkey’s annual total game exports amount to 500 million dollars, while the global market share is less than 1 percent. This is certainly not a digging attempt at Turkey. On the contrary, this sector in our country has found its own niche in a relatively quiet way, and shows a serious export potential.

Game Development in Turkey

Tuğbek Ölek, founding partner of Seti Media, who followed the infantile steps of the gaming sector in Turkey and produces content for years in written gaming media stated “The gaming sector is interesting; some countries can’t even exist in it. Turkey is one of the more mentioned countries in this regard. There are eight major markets in the world; they hold about 85 percent of the industry. Asia (China-Korea-Japan) are very strong, the United States is strong; after that Canada, England, France and Germany are following. Our share is under 1 percent, but this is not a bad thing; on the contrary, our growth potential is higher “.

Of course, an important point here is that unlike many technology companies in the world currently the gaming industry can be kept away from being monopolized. It’s much easier to create and distribute games without being a part of a big publisher. “In the past, only publishers earned the money; now developers have a lot of opportunities to publish their games, “he adds.” When the commission of digital stores is deducted, all the revenue from the sales is left for them. In this regard, we can exclude Asia; as there are major monopolistic publishers such as Tencent and Netease in the region. “

Now, with digital stores, when you develop a game, you can sell it in more than 200 countries the next day without the need of a publisher. Platforms such as application stores or Steam on PC now have taken over. If you know how to do marketing and how to make your game appealing on the store page, you can easily make profit. For example, a sales figure of a 100 thousand is not so much for a game. Now add the price of 20 USD into the equation…

Adopting the digital world has made the CDs and DVDs obsolete hence, publishers became obsolete as well. And of course, massive funding systems like Kickstarter also offer developers greater opportunities than ever to make their dream projects. The game Star Citizen, while still in the project stage and not having any concrete material, collected $148 million from the players. This clearly shows the potential for game development and the financial power of the gaming market.

We talked about not needing giant studios or giant publishers to develop games today. In a sense, anyone with a vision, courage and an idea can develop a game in Turkey. “There are about 20 Turkish studios which have offices in Turkey . Apart from that, there are groups of young and independent developers whom we don’t know the numbers of. These groups also make mobile games and generate revenue. It is not possible to identify by the numbers; but we think that there are 200 groups that function this way. Because every day a new group comes out” he says.

Who are the big players of Turkey which export about $500 million of games? When we ask this question to TOGED, we get the answer: “TaleWorlds Entertainment is the biggest developer on PC. A company that has been developing games since 2005 with more than 70 employees. We have more developers on the mobile platform, and some of them are internationally successful studios. First ones coming to my mind are Peak Games and Gram Games. “

Gram Games also formed a game studio abroad. In other words, Turkey is a country that actually has a game developer fabric. There is also a huge government support in this regard. Tuğbek Ölek, “in my opinion, one of the biggest problems of Turkish game developers today is to decide which government incentive to apply. Even Germany and France do not have this much support for their developers “he says. What a good problem, isn’t it?

TOGED explains these incentives: “We can say that the state offers a comprehensive package of support in different scales and forms, ranging from project-based reimbursement support to financial support for experts hired from overseas. Support is provided by different institutions such as Ministry of Economy, Ministry of Transport, Maritime and Communications, TUBITAK and KOSGEB.

These support packages are open for independent developers as well. For example, the Ministry of Economy provides financial support to developers for up to $200,000 for each game project; if you are exporting your game, you can also get up to additional 100 thousand dollars and up to 50 thousand dollars for licensing. In addition, it is possible to get 50% off support for two employee salaries. If you want to open an office abroad, you can also get rent assistance. You can also benefit from multiple support programs at the same time. Apart from these, there are graduate programs in various universities, incubation centers and scholarship degree programs. “

Besides all these supports, game developers can also work in established studios. As a matter of fact, the studios in Turkey are open to further growth; but they can not find the software engineers to develop for them! TOGED claims that this is one of the biggest problems of the industry: “The biggest demand of the sector is the trained work force. According to Tuğbek Ölek, today’s game development sector creates about 2,000 jobs and it is possible to double this number instantly. If of course trained workforce is to be found…

Aside from people who already established their studios, how will the young people work in this highly profitable sector? According to Tuğbek Ölek, the best initiative at this point might be specific certification programs. “These programs can start from a very young age, and can also be done for graduates who are interested in game development,” says Ölek. TOGED has already stated that there is a mobility in this lane: “There are internship programs, academic programs and special certificate programs both made by universities and private business associations. This is a time-consuming process, but continuing and supporting projects in this field will also satisfy this need of the industry. “

At this point, while not comparable to the past, games are still facing prejudice, even if they are on computers and consoles and mobile phones. There are still superstitions like “the games are addictive”. Rare occasions such as people selling their cars to buy in-game goods are portrayed as common occurrences.

Being a gamer is a prerequisite for your game development. My friends from generation who work in the IT and technology fields, have dreamt about developing games when we were young. But they have been discouraged by their parents, they thought it was an impossible dream and something that would never earn any money. Tuğbek Ölek says, “unfortunately, parents don’t take children serious who are going to develop games,” he adds. “There are some things to do to break this. For example, there are attempts to bring PEGI (a system that detects age limits and harmful content of games) to Turkey, but it is coming slowly for now. “

Is eSports Really a Career?

eSports is the third most popular sport after football and basketball in the world. If we put aside clubs, sponsors and awards, eSports is an extraordinary experience for young people competing. In Turkey, eSportsmen can compete in front of tens of thousands of people. This is a very extraordinary experience for a young person. Although there are some definite researches on the physical sportsmen’s peak effectivity (although they vary from person to person, age of peak effectivity is 28 years, after that, it declines from there), there is no such research on eSports athletes. But it is possible to say that an eSports athlete’s physical effectivity (in this case sharp reflexes) can be better when they are young.

So much so that an age of 25 is too mature for eSports, almost an old age to begin. Although the news headlines titles such as “he makes money by playing games” or “she got a sponsorship agreement with this company” are of interest, there are also different sides to this story. Even though there is no shortage of players (there are also transfers from abroad), there are organizational and structural deficiencies in eSports. There are no professional referees, doctors or certified coaches. For the time being the teams only have trainers, gaming house directors and part time dieticians.

“For example, a LoL game which 12,000 people watched didn’t have a professional referee. the referee was a Riot Games employee. (publisher of LoL)” says Tuğbek Ölek and continues:” I’ve taken our teams to WCG (World Cyber Games) organizations for years. We are planning to form our national team but we don’t have any legal infrastructure or a federation yet. The clubs are made up of 2600 square foot houses where people play in. There are also other shortcomings in the sector: for example, lack of staffed eSports writers, reporters, and so on. According to Ölek, these are the steps that will make the e-ports an industry in Turkey. “A career for people between 18 to 25. What will happen to those stop playing after 25? Will they be commentators, coaches? eSports is not a real career at the moment, but perhaps it has become one only for 20 people “he says. “But when all of the things we mentioned get sorted out, when the sector is industrialized, eSports can be a very serious competitor, for example to basketball, across the globe. “

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Yigit Tezcan
In 2015, after a short span in basketball journalism, and a career as a research assistant in Yeditepe University Department of History, Yiğit Tezcan began to work at Bloomberg Businessweek Türkiye magazine as a translator and reporter. He wrote news stories in wide variety of topics including politics, technology, gaming, cars, and motorsports. Dating back to early 2017, Tezcan started paying a greater attention to gaming economy, eSports, gaming media and their business model. And since October 2017, he has also been a freelance writer for the Turkey’s Oyungezer gaming magazine.