New Industry Analysis

Polish Gaming Sector an International Hit

Newzoo estimates that the Polish gaming industry is worth over 500 million US dollars, not surprising given how in recent years Polish gaming studios have created a name for themselves on the international stage. The country boasts more than 300 game design studios.

Witcher, created by CD Projekt, is one Polish game that has seen immense success, while another studio making an impact is 11 bit, creators of This War of Mine, and their more recent release Frostpunk.

Released in April, Frostpunk immediately jumped to the top of the best-selling list on Steam (a social entertainment platform). The rankings on Steam are based on customer reviews which come only from those that have purchased the game. Polish news magazine Rzeczpospilita reported revenues from sales paid off all production and marketing expenses (estimated by the company at over 10 million zloty) in just a few days.

A number of the studios in Poland are listed on the Warsaw Stock Exchange, although a majority are listed on the alternative NewConnect Stock Exchange. The three largest studios based on capital are CD Projekt, known for Gwent: The Witcher Card Game as well as Cyberpunk 2077; PlayWay who will release a new game Agony in 2018; and 11 bit studios, who have seen their share price increase by over a third since the launch of Frostpunk.

Poland is ranked by Newzoo as the world’s 23rd largest producer of video games. China and the United States continue to lead the way with markets worth over 32 billion US dollars and 25 billion US dollars respectively. The entire industry is forecasted to be worth 143.5 billion US dollars by 2020.

“More than half of this will be generated by the mobile segment. This is the only segment whose value has been steadily growing over the past few years,” says Remigiusz Kościelny, the president of Vivid Games. He adds that in the coming quarter, two new titles from his studio will be distributed on the iOS and Android platforms. In May, the action game Space Pioneer will debut, followed in June Metal Fist. In turn, in August, the studio’s portfolio will be joined by Gravity Rider. “For both Vivid Games and the entire mobile industry, summer is a very good, certainly not dead, period. Users of consoles and PCs go on holiday and switch to smartphones and tablets, looking for entertainment during travel and holidays,” adds Mr Kościelny.

Marcin Kwaśnica, president of Cherrypick Games, concurs and further supports Mr Kościelny’s stance.“That is why we organise special events in games and make the game more attractive,” he says. “Thanks to this, holidays are even more enjoyable and players stay with us for longer. Even after returning to everyday duties.” He adds that Cherrypick Games sees a clear trend in the growth of women’s participation in the gaming market.

“Interestingly, women prefer mobile devices. Currently, two out of three women choose a smartphone or tablet as their preferred platform, and that is where we operate. This year, the premiere of My Beauty Spa: Stars & Stories will take place, which has a chance to become an even bigger hit than My Hospital,” said Mr Kwaśnica.

“New development opportunities and market niches are opening up, which development studios will use to overcome the situation of a massively growing market saturation, to diversify revenues and increase ROI,” says Jacek Głowacki, development manager at iFun4All. “The hit of the last few months have undoubtedly been productions representing the so-called Battle Royal, such as Playerunknown’s Battlegrounds and Fortnite. When it comes to hardware, the Nintendo Switch is unrivaled.”  Adding to the need for development and a change in models is the growing interest in in augmented (AR) and virtual (VR) reality gaming. The sector remains underdeveloped and has not exploded just yet. “VR is generally accepted, but only in a certain part of the market,” says Łukasz Rosiński, a member of Farm 51’s supervisory board. “Developers earn by making simple mobile games which are cunning and interesting. They produce games for VR more so because the technology is there. However, they do not earn as much because the number of consumers that own VR equipment is still limited.”