App Store Paid Game Revenue At All-Time Low; German Bundestag Approves €50m (£42.8m) Games Funding

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TheGamingEconomy Daily Digest brings you the trending business stories in gaming. In today’s edition: App Store paid game revenue at all-time low; German Bundestag approves €50m (£42.8m) games funding; and Proletariat raises USD$20m (£15.5m) in Series C funding.

App Store paid game revenue at all-time low

The share of premium games revenue on the Apple App Store has fallen to 1.8% as of September 30th 2019, its lowest ever, according to data recorded by Sensor Tower. As of September, premium games had grossed USD$337m (£260m) during 2019, compared to revenues totalling USD$18.2bn (£14.1bn) through the same period for free-to-play titles. The number of paid titles released also declined substantially, with 3225 premium games released so far in 2019, representing 7.3% of total launches, compared to the figure of 39,705 (26.1%) observed in 2014.

Apple Arcade has been cited as a potentially significant factor in the decline, with premium game revenue declining by 13% during the subscription platform’s launch month of September 19th-October 20th. While a decline is typically seen during the period due to seasonal factors, the equivalent reduction in the same period last year was -4%.

German Bundestag approves €50m (£42.8m) games funding

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The German Bundestag has given its final approval to €50m (£42.8m) in funding for video game development in its federal budget for 2020 and the following years. The funds will be allocated to projects by the Federal Ministry of Transport and Digital Infrastructure, with 380 applications received since the government initially approved the funding in November 2018. The game development fund is intended to arrest the decline of studio and publisher employee numbers, which has fallen by 5.9% year-on-year, and to make the German market more appealing for the gaming industry in comparison to other European markets, such as France and the UK. The €50m (£42.8m) subsidy is expected to directly lead to approximately €90m (£77m) in tax and social security contributions, according to game – the German Games Industry Association.

Commenting on the funding, Felix Falk, managing director of Game, said, “The securing of games funding is a clear signal for Germany as a games location. The Finance Committee of the German Bundestag provides the important planning security by fixing the budget for the coming years. The decision as well as the broad consensus display the intent across party lines to make Germany a more vital player internationally in the field of computer game development.”

Proletariat raises USD$20m (£15.5m) in Series C funding

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Boston-based developer Proletariat Inc. has raised USD$20m (£15.5m) in Series C funding to grow the company and to aid the publishing efforts for its upcoming fantasy battle royale title Spellbreak, currently in closed-beta. The round was led by Take-Two Interactive Software Inc. with additional contributions from Spark Capital, FirstMark Capital, and other investors. Proletariat was founded in 2012 and previously raised USD$6m (£4.6m) in a Series A round in February 2015.

In a statement, Proletariat CEO Seth Sivak said, “We’ve been looking for the right industry leaders to work with to help us take Spellbreak and Proletariat to the next level. Michael and Take-Two bring a wealth of experience that will be vital as we expand the team, ramp-up development and prepare to self-publish Spellbreak next year for audiences around the world.”