UK video games industry: Overview

Approximate read time: 5 minutes

1. Overview of UK video games industry

The UK video games industry is estimated to contribute between £6bn and £12bn to the UK economy in terms of GVA and to support around 73,000 jobs. The lower estimate has been set out by the industry trade body Ukie for 2025^[1] and the higher estimate comes from a 2025 study published by the University of Portsmouth, commissioned by the industry’s trade association TIGA.^[2] As a comparison, estimates have been published that the music industry contributed around £8bn in terms of GVA in 2024 and the legal sector contributed around £38bn.^[3]

Both TIGA and Ukie have also pointed to the regional benefits brought by the industry, with studios and publishers spread across the UK. For example, TIGA stated:

While the capital is responsible for the largest share of GVA [gross value added] at 38% (£2.1bn), regional hubs make hugely significant contributions, including the North West (£443mn), Scotland (£393mn), West Midlands (£362mn), East of England (362mn), Yorkshire & Humber (£253mn), North East (£200mn), East Midlands (£171mn), South West (£126mn), Northern Ireland (£52mn) and Wales (£27mn).^[4]

Video games include games played on a range of platforms, including PCs, consoles and mobile devices.

The industry is made up of companies covering development, publishing, technology and specialist support services. The Institute of Chartered Accountants in England and Wales (ICAEW) explains that the largest sector in the UK is game developers, with these operating either as publisher-owned studios or independent studios.^[5] Publishers then provide the financing, marketing and global distribution. Many games publishers are multinational organisations based in other countries, such as Electronic Arts, Nintendo, Sony and Microsoft. The ICAEW states that “whilst the UK market includes multinational publishers and platform holders, it remains heavily weighted towards small and medium-sized enterprises (SMEs)”.

Notable publishers and developers in the UK include:

• Rockstar North: A key developer of the Grand Theft Auto games, based in Edinburgh.
• Sports Interactive: Developer of the Football Manager series, based in London.
• Frontier: Publisher and developer based in Cambridge, which has released games including Rollercoaster Tycoon and Formula 1 Manager. The company is listed on the UK’s alternative investment market [AIM].
• Team 17: Publisher and developer of a wide range of games, including the Worms and Overcooked series. Team 17 is also listed on the UK’s AIM and, based on its market capitalisation, is valued at around £400mn.
• FuturLab: Based in Brighton, it has developed and now publishes the popular PowerWash Simulator series. PowerWash Simulator 1 sold around 17mn units worldwide.

UK consumers spent £8.76bn on video games in 2025, a 7.4% increase on the previous year.^[6]

2. UK development for overseas companies

The video game Grand Theft Auto (GTA) 6 is due to be released on 19 November 2026. It is expected to be one of the biggest media releases of all time. Development costs have been estimated at over $1bn and some analysts predict the game will generate between $3.25bn and $5.2bn of revenue in its first week of release.^[7] The game’s predecessor, GTA 5, was released in 2013 and made $1bn in the first three days of release and over $8bn by 2025.^[8]

The GTA games have been primarily developed by Rockstar North in Scotland, although GTA 6 is being developed worldwide (including at Rockstar North). However, the publisher and owner of the franchise is US-based. A similar situation of UK-based development but overseas publishing or ownership also applies to several other large game franchises, such as the Fable games and the Football Manager series.

In an interview with the Game Business, then minister for creative industries, media and arts Ian Murray was asked whether this development and ownership setup was an issue for the UK.^[9] He responded:

Only partially […] I’ve been to Take-Two [the US owners] in Manhattan and all they talk about is that Grand Theft Auto 6 is being built in Scotland, essentially. You gain from the jobs. You gain from the skills. You gain from the economic activity. You gain from the prestige. […] Yes, you want the intellectual property to stay in the UK. But actually, for us, in terms of the sector plan, the jobs, growth and the skills, having [these games] made here is a big, big part of that.

Mr Murray also highlighted how a similar situation applied to certain high-profile intellectual property in other sectors.

3. Supporting the UK video games industry

Mr Murray was talking to the Game Business to publicise the UK government’s announced £28.5mn of funding over the next three years for the UK games fund (UKGF).^[10] The fund is open for applications for UK games developers and is intended to support the growth of the industry, to create new jobs and skills, and develop new intellectual property.^[11] It is part of a suite of commitments set out in the government’s ‘Creative industries sector plan’.^[12]

UK-based video game makers may also be eligible for tax credits under the video games expenditure credit (VGEC) scheme. These expenditure credits are claimed at 34% of qualifying expenditure; this is worked out at the lower of either 80% of total core costs, or the amount of UK core costs.^[13]

However, challenges remain. For example, TIGA has highlighted difficulties for the UK games industry in recent years and believes it needs more support.^[14] TIGA’s recent findings indicated a fall in the number of people employed in game development and in the number of UK studios. Its recommendations to address these issues included:

• Enhancing the VGEC. It suggested a rate of 53% on 80% of qualifying costs for projects up to £23.5mn. It believed this could increase GVA by £482mn and create 6,952 jobs. It estimated it would cost £135mn but could generate £156.4mn in tax revenue.
• Increasing the VGEC rate to 39%. It estimated this could increase GVA by £436.2mn and create 6,291 jobs.
• Raising the proportion of VGEC qualifying expenditure. It claimed increasing the proportion of qualifying expenditure from 80% to 100% could increase GVA by £731.7mn and generate 10,551 jobs (including 1,292 developers).
• Increasing the value of the grants available under the UKGF.

In answer to parliamentary questions on VGEC rate levels, the government has said it is not currently considering raising these rates.^[15] Exchequer Secretary Dan Tomlinson stated:

Video games companies already benefit from a generous video games expenditure credit (VGEC) of 34%. In 2023–24, £327mn of corporation tax was relieved through video game tax relief. This generous tax support sits alongside the Department for Culture, Media and Sport’s new £30mn games growth package, designed to back the next generation of start‑up studios and talent and attract further inward investment.^[16]

4. Read more

Other issues readers may be interested to read more about include:

• Loot boxes in video games and links to gambling; see: House of Commons Library, ‘Loot boxes in video games’, 13 August 2024
• Concerns over working conditions and attempts at unionisation; see: BBC News, ‘Union urges GTA 6 maker Rockstar to address working conditions’, 30 June 2026

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Image by Ella Don on Unsplash.