Bridget Brennan reported this story on Friday, October 9, 2015 12:24:49

KIM LANDERS: Australia's interactive games industry is worth $2.5 billion but there are concerns video game developers are now leaving the country.



They say a lack of government investment is beginning to hamper what could become a lucrative export industry, as Bridget Brennan reports.



(Sounds from a Metrocide)



BRIDGET BRENNAN: Metrocide is a Australian-made video game set in a dangerous virtual dystopia.



The game was created by two Sydney brothers, Rohan and Leigh Harris, who started their own company Flat Earth Games three years ago.



Leigh Harris says they sell a range of successful games which are available on iPhones, laptops and tablets.



LEIGH HARRIS: That one did well enough that we were able to fund our third and now we're working on our fourth and fifth, still operating under our own steam.



BRIDGET BRENNAN: As game developers, the Harris brothers are a part of a massive global industry, tipped to eclipse the film industry soon, it's already more lucrative than music sales.



Around the world, the interactive gaming industry is worth a whopping $77 billion.



Australia's industry accounts for about 3 per cent of that trade: last year, retail and online sales of video games came in at about $2.4 billion.



But Rohan Harris says despite that success, it's been tough to get support from private investors.



ROHAN HARRIS: It's very difficult, because while there's a lot of money in the tech start-up, you're adding a creative element with video games, which a lot of people who are looking to invest in things are a bit concerned about.



BRIDGET BRENNAN: The Australian Interactive Games Fund, which awarded grants to developers, was scrapped by the Abbott government in last year's budget.



Leigh Harris thinks that was a mistake.



LEIGH HARRIS: Had it been allowed to run for the full three years that it was originally supposed to, it would have been self-perpetuating as the funds were reimbursed from people that had got funding from there before.



So we were one of the very lucky few people to get money on that one round when it came about and as a result of that, we've not got our own company, and we've been running it for years. But ever since there, there's been very few places for indies to turn to to get that initial infrastructure going.



BRIDGET BRENNAN: Melbourne game developer Trent Kusters agrees. His game Armello launched to critical acclaim. He runs his own independent studio called League of Geeks.



TRENT KUSTERS: I think reinstating Federal Government support, financial support is the first thing and then I think as well acknowledging games as not only as a huge, huge market and industry with export potential, I mean, like you know, internationally the games industry is making billions and billions of dollars, but it's also that it's the aesthetic form of the generations that are coming up now, you know, of my generation, the generations below me and even the one above the average household, the average age of the Australian gamer is what, you know, like 33 or something like that.



So it's something that everyone games now.



BRIDGET BRENNAN: A Senate inquiry is looking at ways to encourage Australia's burgeoning gaming industry.



The Games Developers' Association of Australia wants new tax incentives, similar to those available to producers and investors in the film industry.



Anthony Reed is the association's chief executive.



ANTHONY REED: It's most likely produces an offset that is already for film and TV right now. There is that incentive from government that a percentage of production would be returned through the tax office, but what they return in that, they get you know, tenfold back from revenues generated by sales of the game.



That money comes directly into Australia off games that are made by Australian creators.



BRIDGET BRENNAN: What do you need to be competitive in an environment where countries are trying new things all the time to encourage investment?



ANTHONY REED: I think you've hit the nail on the head. The lack of investment is a massive issue because it stifles growth. We don't have the level of sophisticated investment community in more risk-inclined creative sectors that we see in Canada or in the US or in Europe and the UK.



BRIDGET BRENNAN: Mr Reed says Australia's gaming talent is world-renowned.



But, many home-grown gaming success stories are now working overseas.



ANTHONY REED: And a lot of the contractor work that Australia or the Australian industry had relied on then vanished, and the only opportunity without that support and incentive from government to, you know, to maintain the industry, you know a lot of our talent went overseas to further their careers, so its quite interesting now if you look at some of the most successful games in the world, whenever you see a spokesman come up, invariably they have an Australian accent.



We have Australians in really high positions in these amazing companies all over the world. I mean that's just a testament to the talent that exists here.



KIM LANDERS: Antony Reed from the Game Developers' Association of Australia, ending Bridget Brennan's report.