Viewpoint: The UK video games industry faces difficult changes

Jason Kingsley, co-founder of the British video games studio Rebellion, has been made an Officer of the Order of the British Empire in the Queen's Birthday Honours List for services to the economy.

The honour comes at a pivotal time for his industry, which is gearing up for the next generation of video games consoles while facing disruption from a shift to digital downloads, as well as the rise of smartphones and tablets and the emergence of crowdsourced funding as an alternative source of investment.

To mark the occasion, the BBC invited Mr Kingsley to outline the challenges ahead as he saw them.

I've been making games with my brother Chris and a hugely talented team of people at Rebellion for over 20 years now.

The video game industry can have a tendency to surprise people. Not only does it employ very intelligent, driven, ambitious and talented people, but it is also a key driver for economic revenue on the UK, generating £1bn annually for the country's GDP.

We will almost certainly see the death of physical media as a mass market phenomenon”

Our latest game is holding its own right at the top of the charts in global rankings against the behemoths of the industry which are mostly US-created, and have massively bigger budgets for development and marketing.

One thing that remains unchanged is that there will always be change in our industry.

There have been many challenges, not only to the way games play but in the way they are made and they way they are delivered. Whilst sadly change and the recession has had an impact on UK game developers with many studios closing down, there is much to be excited about for the future.

I co-founded and am chair of the games association Tiga.

We fought for years to gain tax relief for the games industry and, in the last Budget, Chancellor George Osborne delivered this. Whilst the details are there to be finalised, it means developers in the UK are on a level playing field when they compete against their counterparts in countries such as France and Canada where such breaks have been in place for many years.

Gaming is set to change massively over the next five years.

People like playing games, and content creation remains firmly fixed in place, making something out of ideas and hard work, but how people access games and what they play them on is changing.

This is probably not good news for retail but it is good news for consumer and developer alike, thanks, in no small part, to improving data infrastructure, new business models and new technology like smartphones and tablets.

I strongly believe the UK games development sector is ideally placed to take advantage of the massive potential of truly global, relatively cost-effective and almost infinitely scalable distribution.

One of our recent games, Judge Dredd vs Zombies on Apple's App store, was intriguingly being played by 14 people in Mongolia the other day, so we have finally managed to place games in the hands of people in places where sending a box would make it prohibitively expensive.

We are seeing the rapid evolution of new business models. Free-to-play, subscription, episodic, pay-as-you-play and more in-game payment elements will be experimented with.

Some payment methods will die, probably very rapidly, and some new ones will be created, probably equally as rapidly.

Digital distribution will expand and gain in confidence to the point where we will almost certainly see the death of physical media as a mass-market phenomenon.

I hope we will still have boxed collectors editions and special physical products for enthusiasts, but I think this will be the same interest area as, for example, vinyl album collectors, or VHS tape collectors - still viable, eccentric, quite British and wonderful but necessarily more expensive, exclusive and non-mainstream.

Finally, I think we can expect games to become even more socially linked.

Developers will have to think more about the social experience and how they integrate with people's online lifestyles, partly because people will expect to be able to let their friends know what they are doing at that moment, and partly because it helps get their game noticed in a worldwide shop that has almost infinitely big shelves.

There is no doubt that UK developers over the past three decades have worked hard to put the country in a very strong position and it is a platform upon which we can build to ensure computer games have a rosy future for the next 30 years and beyond.

These are difficult and challenging times but these are also exciting times.

Jason Kingsley is chief executive of Rebellion, the Oxford-based video game company he co-founded in 1991. He is also chairman of Tiga, the trade association representing the UK's games industry.