After luxury hotels and football stars, now it’s the turn of gamers. Saudi Arabia is a player to be reckoned with in the coming years in the video games sector. For several months now, the Wahhabi kingdom has made no secret of its ambition to become one of the world’s leading strongholds in this industry.
The latest manifestation of these intentions came on October 24, when Crown Prince Mohammed Bin Salman, known as “MBS,” personally announced that an e-sports World Cup would be held in Riyadh starting in 2024, with the most skillful players competing in popular games. He described it as “the natural next step [aimed at enabling Saudi Arabia] to become the world’s leading video game and e-sport hub.” In 2023, the country on the Persian-Arabian peninsula was the first to offer a video games competition (Gamers8, in the summer), offering a record total prize of $45 million (€41.4 million).
Acquiring studios worldwide
In September 2022, the Public Investment Fund (PIF) – Saudi Arabia’s sovereign wealth fund – announced the allocation of $38 billion to invest in the games sector. This project is part of the Vision 2030 plan, which aims to reduce the kingdom’s dependence on oil revenues. By the end of the decade, Riyadh aims to attract or develop 250 video game companies, creating nearly 40,000 jobs. The sector could generate 1% of the country’s gross domestic product.
Spearheading this strategy is the Savvy Group, owned by the PIF and chaired by “MBS” himself – known to be a video game enthusiast. Brian Ward, an industry veteran who has held senior positions with some of the biggest names in the industry (Activision, EA, Xbox), has been recruited to take the helm of the company.
The company aims to acquire studios worldwide. Its biggest acquisition to date was Scopely (Monopoly Go! Scrabble Go) for $4.9 billion in April. It also acquired shares in Swedish conglomerate Embracer for $1 billion.
The PIF has also invested in the elite of the global video games industry: it owns more than 8% of Japan’s Nintendo and has made major investments in Activision Blizzard (with a stake valued at the end of March at $3.2 billion), Electronic Arts ( $3.2 billion), and Take-Two ($1.7 billion). Only its stakes in luxury electric car manufacturer Lucid ($9.4 billion) and Uber ($3.1 billion) can rival these amounts.
Saudi Arabia’s investment is justified on several counts. With more than one in six inhabitants under the age of 30, the country has a large number of gamers. In fact, 70% of the population reports playing video games. What’s more, the authorities see the development of this industry as a way of spreading their culture. That’s why they are developing training programs for young people in the video game industry.
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