Boost For Game Development Sector As First Round GDSR Recipients Named

NZ On Air has announced the recipients of the inaugural round of the Game Development Sector Rebate (GDSR) – established to boost ongoing development and growth of the game development sector, and keep game studios and industry talent in Aotearoa New Zealand.

Thirty-two studios will receive just over $12million in total rebates in this inaugural general registration round. Alongside an initial Pilot Phase, carried out at the end of 2023 with a small number of studios to finetune the administrative process, this brings the total amount of GDSR rebates to date up to just under $22.3million.

The GDSR was established in Budget 2023 with $40m per annum over four years to support the game development sector. It reimburses 20 percent of eligible expenditure incurred in New Zealand, capped at $3m per annum per studio.

The Ministry of Business, Innovation and Employment (MBIE) has policy responsibility while NZ On Air is administrator of the rebate.

"The game development sector currently contributes over $400 million annually to our economy," says Chantelle Cole, NZ On Air GDSR Programme Director. "With this new support, the sector has an incredible opportunity for growth. Before the GDSR, New Zealand was at a very real risk of losing studios to countries such as Australia."

Cole says studios have indicated they will use the rebate for talent acquisition and retention, paying internationally competitive salaries, launching new games, creating new intellectual property, and reinvesting in their New Zealand operations.

"Research on similar schemes worldwide shows some countries seeing a two to four dollar return for each dollar invested,” says Cole. “Given the games industry primarily focuses on weightless exports, this translates to substantial revenue and tax income for New Zealand."

While MBIE will review the GDSR after two and four years to gauge early impact, NZ On Air engaged leading international consulting firm Nordicity, which has experience with similar schemes in other territories, to perform an initial assessment.

“In Year One of the GDSR, our modelling estimated that reinvestment could potentially increase the following year’s labour pool by upwards of eight percent on 2023’s total labour,” says Kristian Roberts, CEO of Nordicity. “That shows the ability of a rebate such as this one to mitigate against talent attrition and studios relocating – and even lead to the growth of existing studios.”

Roberts also points out that any growth in the game development industry could also spill over into other adjacent industries.

“Growth in the game industry can cross over in terms of skill sets and consumer preferences into immersive media development such as real time systems development, virtual production and animation, the eSports sector and game streaming,” says Roberts.

The NZ Game Developers Association (NZGDA) says its members believe the rebate will elevate the industry to new heights.

“Our NZGDA industry survey showed that prior to the GDSR being put in place, nearly 50 percent of NZ game studios were considering moving their operations to Australia,” says Carl Leducq, Chair of the NZGDA. “Though the real impacts of the GDSR will become clearer over the next few years, it’s already resulted in studios continuing to do business in NZ and ignited a new wave of interest and investment for our members.”

One of the successful first year applicants, Runaway, says having this rebate available is extremely significant for businesses such as theirs.

“It will allow us to hire and retain more people and pay more competitive salaries,” says Zoe Hobson, CEO of Runaway. “That will enable us to produce more products, faster, and provide stronger growth in industry revenue. It’s already had a positive impact on our team’s growth and our product pipelines.”

Chief Financial Officer of game studio PikPok, Lance Burgess, says the GDSR has enabled them to keep the team together in New Zealand and continue developing multiple titles.  

“The GDSR will enable future dividends for the wider economy such as boosting both employment and export earnings; and to the Government in the form of increased tax revenues.”   

NZ On Air chief executive Cameron Harland says the agency is pleased to have played a key role in building the rebate and bringing it to the sector.

“There is a growing alignment between the screen, games and music sectors – all spaces NZ On Air operates in,” says Harland. “We have been funding children’s games for several years, so we already had an understanding of the sector and its growth potential. There are also many synergies and much we can learn about audience engagement across the sectors.”

The next round of the GDSR will open towards the end of the year. To find out more, go to the GDSR page on the NZ On Air website.   

Rebate Decisions 

• 2Up Games
• A44
• Balancing Monkey Games
• Beyond Studios
• Blind Squirrel Games
• CamShaft Software
• CerebralFix
• Deep Field Games
• Digital Confectioners
• Dinosaur Polo Club
• Dreamloft Games
• Gfactor
• Grinding Gear Games
• Hashbane Interactive
• Janzen IP Co
• Flightless
• Mighty Eyes
• Mytona
• Niantic Aotearoa NZ
• Ninja Kiwi
• Outerdawn
• PikPok
• RiffRaff Games
• RocketWerkz
• Runaway
• Sharpmind Games
• Space Rock Games
• StaplesVR
• Synty Studios
• Usual Suspects Studios
• Wētā Workshop
• Zero King

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