Saudi Arabia wants to become a benchmark in the video game industry. This interest in electronic entertainment stems mainly from the country's desire to diversify its economy, going beyond oil trade. The government of Saudi Arabia, through a public investment fund, has allocated 38,000 million dollars to turn the country into a new reference enclave for the video game sector.
This public investment fund is managed by a company called Savvy Games Group, which intends to make the city of Riyadh the epicenter of this initiative. Its goal is to start developing big-budget video games, as well as editing and publishing titles created in other countries in the region. Currently, Savvy owns a single development studio with 45 workers. It's been running for a year, and before creating their first game for consoles, they want to develop a title for mobile devices.
In all, the Savvy Games Group conglomerate has five active companies, Bloomberg reports, including companies also focused on esports. Part of Saudi Arabia's strategy is to consolidate itself as the organizing country for esports competitions in the Middle East. And it also owns a company specialized in the construction of stadiums and infrastructures for electronic sports competitions.
Another aspect of Saudi Arabia's strategy involves acquiring already consolidated companies in other countries. Savvy Games Group CEO Brian Ward worked for more than eight years in management roles at Activision and also has experience at Microsoft and Electronic Arts. He knows the sector well outside the borders of the Middle East and, as he points out in Bloomberg, he believes that it is important to gain influence in foreign companies.
For this reason, in mid-2022, Saudi Arabia bought 5% of Nintendo. A figure that, in February of this year, rose to 8.3%, making the Arab country the largest foreign shareholder of the company. In 2022, Savvy also bought 8% of the Swedish giant Embracer Group.
Along the same lines, Brian Ward assures that his intention is to buy an already consolidated foreign company. Take full control. Electronic Arts, for example, is out of reach, as Savvy has a budget of about $13 billion for this operation, slightly more than the $12.7 billion Zynga cost Take-Two Interactive.
In fact, last week, Savvy Games Group bought the Californian studio Scopely, specialized in the development of mobile video games. The acquisition was settled for 4.9 billion dollars and the Californian company will continue to operate independently, although under the umbrella of this Arab company.
The fact that Saudi Arabia is a country that openly violates the human rights of its citizens makes its relationship with some foreign companies somewhat difficult. In 2020, for example, Riot Games, the company responsible for League of Legends and Valorant, canceled a collaboration agreement with Neom, a city under construction in Saudi Arabia. This decision was made after a large negative reaction from some Riot Games partners, workers and fans.
In addition, this initiative from Saudi Arabia also raises doubts in part of the Western public, which wonders how the political and religious conditions of a country like this can affect the development of new video games. They are logical doubts and there is evidence of what could happen. To find them, you only have to take a look at the current panorama. Many video game companies develop their titles based on the censorship rules in China because they know that it is a very important market. Or, in the United States, the Disney monopoly is causing a gradual uniformity in the audiovisual entertainment sector.
Currently, the video game industry worldwide moves around 184,400 million dollars and, according to the consultancy Newzoo, in 2025 this figure will reach 211,000 million. With its bet of 38,000 million dollars, Saudi Arabia wants to get part of this cake with a strategy with three fundamental pillars: intervene in foreign companies, create large own companies and make the country the benchmark for esports in the Middle East.
