According to a joint report by the Interactive Software Federation of Europe and the European Games Developer Federation, the European video game sector has witnessed an unprecedented wave in popularity. A total of €24.50 billion was invested in video games across multiple European markets in 2022, marking a 5% growth when compared to the €23.3 billion generated in both 2021 and 2020. Despite China and the United States leading the global gaming market in terms of income and participation, five European nations rank among the Top 10 on the list. This trend suggests that Europe is rapidly emerging as the next great hub for gaming and e-sports, solidifying its position as a substantial market for video gaming services.
The Cyprus gaming industry has been experiencing a rapid transformation, emerging as a significant contributor to the country’s economy and cultural landscape. This Mediterranean nation, known for its beautiful beaches and historical sites, has seen a surge in gaming-related activities, driven by a growing gaming community, supportive government initiatives and a rise in events.
The Aspen Trust group delves into the data and analysis that highlight the growth and potential of the Cyprus gaming industry, aiming to discover optimal strategies for ensuring your business’s sustained success.
Cyprus: Expanding Gaming Community
The Cyprus gaming community has experienced substantial growth, driven by the increased availability of internet connectivity and the widespread adoption of smartphones and gaming consoles. According to Statista’s study on the Video Games market, the revenue is expected to reach US$28.96 million by 2023. Additionally, the market volume is set to grow at an annual rate of 8.50% (CAGR 2023-2027), reaching US$40.13 million by 2027. Furthermore, the number of users is anticipated to reach 428.30 thousand by the same year, indicating a promising expansion in the gaming industry in Cyprus.
1. Mobile Gaming on the Rise:
Mobile gaming has emerged as the dominant Cyprus gaming platform. The convenience and portability of smartphones have led to a surge in mobile gaming app downloads and in-app purchases. The revenue from mobile gaming in Cyprus is expected to reach $9.23 million in 2023, reflecting the significant impact of this platform on the gaming industry. The projected market volume for the gaming industry is estimated to reach $13.19 million by 2027, with an expected annual growth rate (CAGR 2023-2027) of 9.35%.
2. Growth of Game Development Studios:
The growth of Cyprus gaming industry has given rise to the establishment of local game development studios. These studios produce original and innovative games, with a focus on catering to both domestic and international markets. The support from government initiatives, such as grants and tax incentives, has encouraged the growth of these studios.
3. E-Sports as a Cultural Phenomenon:
E-sports has garnered significant popularity in Cyprus, with the Cyprus E-sports Organization (CESO) playing a pivotal role in attracting both players and spectators. The nation has become a hotspot for local and international e-sports events, including tournaments and leagues that draw widespread participation. The prominence of e-sports was further highlighted in 2021 when the Cyprus Gaming Show prominently featured it, solidifying its status as an integral component of the gaming industry in Cyprus.
4. Local Government Support:
The government of Cyprus has been proactive in supporting the growth of Cyprus gaming industry. The establishment of the CGC in 2015 brought in clear regulatory frameworks for the licensing and operation of gaming companies in the country. Additionally, the government’s efforts to promote technology and innovation have facilitated the growth of game development studios.
5. International Collaboration:
Cyprus has actively sought collaborations with international gaming companies and organizations. Such partnerships have provided opportunities for knowledge sharing, technology transfer, and market expansion. Furthermore, international collaborations have strengthened the position of Cyprus as a rising star in the global gaming industry.
Why Cyprus Is a Rising Hub for Gaming Companies
As video games maintain their vital role in the global entertainment sector, Cyprus remains a magnet for international enterprises seeking regional headquarters. With cost-effective services, a beneficial business environment and more, the island is swiftly evolving into a hub for pioneering game developers. These companies are enhancing the gaming experience while shaping culture, commerce, and community dynamics.
1. Favorable Business Environment:
Cyprus offers a business-friendly environment that attracts gaming and tech companies. According to the World Bank’s Ease of Doing Business Index, Cyprus ranks favorably at 54th out of 190 countries (2021). Its efficient company registration process, transparent regulations, and reliable legal system make it an appealing choice for businesses seeking a smooth and secure establishment.
2. Low Corporate Tax Rate:
One of the most significant advantages for gaming and tech companies in Cyprus is its low corporate tax rate. The country’s corporate tax rate is fixed at 12.5%, one of the lowest in the European Union (EU). This competitive tax structure allows companies to optimize their tax liabilities while still benefiting from EU membership advantages.
3. Access to EU Labor Markets:
Cyprus, as a member of the European Union, enjoys distinct advantages in the gaming industry due to the principles of free movement and access to the EU labor market. This means that professionals and talents from across the EU can easily relocate and work within Cyprus’ gaming sector, contributing to a diverse and skilled workforce. This advantage not only fosters the exchange of expertise but also enhances the competitiveness of the country’s gaming ecosystem.
4. Growing Tech Workforce:
Cyprus has a young and dynamic workforce with a growing pool of tech-savvy professionals. According to Eurostat, the country’s youth unemployment rate declined from 16.1% in 2014 to 4.9% indicating an increasingly skilled and employable workforce. Furthermore, the government has invested in educational initiatives, including digital skills training programs, to meet the demands of the tech industry.
5. Startup Support and Funding:
The government of Cyprus, along with private investors and accelerators, has actively promoted the growth of startups in the tech and gaming sectors. Numerous incubators and innovation hubs have been established to support early-stage companies. Moreover, venture capital investments in Cyprus have been steadily rising, providing financial backing for promising tech startups and companies.
6. Attractive Quality of Life:
The island’s favorable climate, stunning landscapes, and rich cultural heritage contribute to an attractive quality of life. A harmonious work-life balance and access to recreational activities make Cyprus appealing to both employees and their families.
Empowering Your Business for Excellence and Growth
The Cyprus gaming industry is on a trajectory of growth and expansion, driven by a thriving gaming community, mobile gaming dominance, the emergence of game development studios, e-sports popularity, economic contributions, and government support. The data and analysis presented herein underscore the industry’s potential as a significant player in the country’s economy and its increasing importance in the global gaming landscape. As Cyprus continues to foster innovation and collaboration, its gaming industry is set to shine brighter in the years to come.
As the Cyprus gaming industry continues to flourish, companies need a reliable and forward-thinking partner to thrive in this competitive landscape. The Aspen Trust Group stands ready to be that partner.
We offer comprehensive services, including accounting, payroll, and more, designed to alleviate the stress of administrative tasks for gaming and tech companies. Our experienced professionals ensure efficient accounting practices, accurate payroll management, tax compliance and more customizable solutions tailored to your specific needs. With our support, you can focus on driving innovation and growth, knowing that your back-office operations are in capable hands. Experience unrivaled customer satisfaction and partner with The Aspen Trust Group to propel your business towards success and a brighter future. Contact us today for unparalleled back-office support.