A new survey from Today’s Gamers takes a look into the big money arena of massively multiplayer online games.

The report focused on the U.S., UK, Germany, France, Belgium and the Netherlands. The U.S. boasted 46.0 million MMO gamers, of whom 46.0 percent paid for the privilege to play their online game of choice. Those who did pay to play an MMO spent a total of $3.8 billion on subscriptions, virtual currency, game purchases and other micro-transactions, which works out to $15.10 spent by each U.S.-based MMO gamer per month.

Following the U.S. in total dollars spent on MMOs were the UK ($270.0 million), Germany ($250.0 million), France ($220.0 million), the Netherlands ($65.0 million) and Belgium ($55.0 million). The UK was tops in terms of monthly amount spent on MMOs with a figure of £10.60 (approximately $15.89 U.S.) per gamer.

Germany actually boasted more MMO gamers than the UK, 5.9 million to 4.2 million, but German gamers averaged only £6.70 spent (approximately $10.04) on MMOs per month.

The Virginia Production Alliance (VPA) is a key factor behind two bills passing through the state’s legislature that would see tax credits for movie productions filmed in the state.

While the measures started out as incentives solely for motion picture development, it appears the videogame industry made its way into the talks in a bid to get some backing in the state for game developers. A note on the VPA’s Facebook page stated that the film incentive bills “have been essentially co-opted by the videogaming industry.”

The VPA continued:

The video game industry has injected itself into the incentive conversation this year. This is the first time we have ever heard from them. They are attempting to be included without providing any data or studies as to the Return on Investment or how they may work given the current incentive plan discussions.

The VPA cautioned that they needed more time to learn about interactive entertainment developers and added that, since the bill was designed first for film makers, that group has “earned the right to be the first recipient of incentive dollars.”

A measure was added to the bills that would see game developers able to receive tax breaks in 2013.

The VPA added, “Our world changed today with the addition of digital interactive media to the family. We need to reach out to the gaming industry and make this new relationship mutually beneficial for all.”

Virginia tax credits for film makers would begin in 2011.

The Entertainment Media Council (EMC), an organization launched about a year ago in order to offer mentoring and other resources to videogame entrepreneurs and corporate types has issued a call for charter members.

Charter members who choose to help out the EMC will receive honorary lifetime memberships for their key personnel and will be responsible for “empowering the association and, by extension, the industry as a whole to” increase the success rate of new firms, stabilize the business landscape, explore and create new business models, reduce unnecessary and wasteful layoffs and effect other significant change.”

EMC Founder Morgan Ramsay added, “The path we have chosen is difficult, but the rewards will be great. We are seeking Charter Members, businesses whose leaders believe in our mission, to help us forward.”

The EMC's take on "responsibility," as related to videogame executives:

Since 1976, the industry has been besieged by cause advocates, media watchdogs, and legislators. Despite the fact that most attempts to regulate video games have failed—none of the 48 related bills proposed during the 2008/09 period passed—the demand for socially responsible business practices, from creators to consumers, has never been as strong.

A British ex-pat currently living in Dubai has penned an article that examines what it’s like to be a gamer in the United Arab Emirates.

Josh Brindley wrote the two-part piece for GamesLatest and began by outlining some generalities, such as how Dubai gamers seem to prefer single-player gaming over multiplayer, though the writer points out that this may be more of a factor of Xbox Live not being officially supported yet in the UAE. Sony’s PlayStation network, however, has been supported in the country since the PS3’s introduction.

UAE gamers also seem to prefer the PS3 over the Xbox 360 and sports games over shooters.

Brindley also details how easy it is to acquire banned games in the UAE:

Despite being officially banned, many games can be acquired over the counter fairly easily in the gray market because the gamers demand for it is high, and everybody’s willing to pay to play.

Many expats who’ve just moved into the country don’t know about the grey market games, so they aren’t be able to buy them.

He sums up:

Most of the differences are because gaming isn’t quite as popular as in the UK, but the market is growing rapidly so it won’t be long before most of the differences are resolved. If the UAE adopted some of the methods of distribution the UK uses, then I think the gaming market would grow faster.

Backed by a group of proven independent game developers, a new organization has launched with an aim to buck the traditional game publisher funding model by providing financing to up and coming game creators.

Indie Fund is comprised of Ron Carmel (pictured) and Kyle Gabler from 2D Boy (World of Goo), Jonathan Blow of Number One (Braid), Kelle Santiago from thatgamecompany (fl0wer), Nathan Vella of Capy (Critter Crunch), Matthew Wegner from Flashbang Studios (Off-Road Velociraptor Safari) and Aaron Isaksen of AppAbove Games (Armadillo Gold Rush).

The company’s goal is to, “is to support the growth of games as a medium by helping indie developers get financially independent and stay financially independent.”

Gamasutra has a Q&A on its site with Carmel, who offered some additional insight into the new venture. He indicated that funding discussions are already underway with several indie developers and that Indie Fund is equipped to back “a few games a year for two to three years.”

Carmel added:

Most developers today fund their games by bootstrapping or by signing a publishing deal. In many cases, those indies that sign a publishing deal don't really need a publisher; they just need funding and can easily handle everything else themselves.

Carmel will disclose more information on the project in a lecture at next week’s Game Developers Conference.

|Image from Flickr|

Left Behind Games and Digital Praise have announced the merger of the two companies into a single Christian game producing powerhouse.

Digital Praise has over 30 titles in its repertoire, including Adventures in Odyssey, Guitar Praise, Dance Praise, Light Rangers, and aMazing Bible. The company was established in 2003 and publishes for the PC, Mac and iPhone, in addition to producing online Flash games.

Left Behind Games should be familiar to readers of this site, as we’ve covered their recent entry into the Xbox and Wii markets, in addition to the pilot release of their games in Texas Wal-Mart stores.

Left Behind CEO Troy Lyndon cited four key elements Digital Praise brings to the merger:

(1) strong brands and products, (2) multi-channeled distribution, (3) a solid management team and (4) a history of generating millions of dollars in the emerging Christian video game market, a feat no company has matched.

Philadelphia Mayor Michael Nutter (pictured) has proposed new tax policies designed to make city more attractive to tech firms, including videogame developers.

Nutter unveiled the plan last week in a speech to the Greater Philadelphia Chamber of Commerce, reports Philly.com. The Mayor suggested that tech firms pay taxes only on goods and services sold within the city, which would provide some respite from the current system, in which “a company with headquarters and employees in the city pays more taxes than a company in the suburbs with the same sales figures in the city.”

The altered tax structure does not require City Council approval and will reportedly be introduced in the spring.

Game developer Mike Worth, of Space Whale Studios, located just outside of Philadelphia in Bryn Mawr, Pennsylvania, told Metro International that the current state of tax affairs in Philly is what caused him to locate his company in the suburbs.  Worth, who is also an organizer for the Videogame Growth Initiative, a grass roots organization that has been lobbying for tax breaks in the city, estimates that the city has been losing 40 game graduates a year to other more attractive locales.

Worth is also a candidate for the International Game Developers Association (IGDA) board of directors.

In advance of the (now) ongoing London-based Global Investment Conference, UK Prime Minister Gordon Brown (pictured) gave a shout out to UK game developers.

In a podcast (MP3 here, thanks Edge), Brown highlighted the UK as a “great place to invest,” and then heaped praise on the UK games industry, saying, “We’re leading the way in creative industries… by far the biggest producer of videogames in Europe.”

Brown promised that the conference would not just about “talking shop,” saying, “there will be new commitments of investment off the back of this conference.”

UK trade organization TIGA backed Brown’s comments, with TIGA CEO Richard Wilson adding, “We warmly welcome Prime Minster Gordon Brown’s comments and urge him to act quickly to introduce a Games Tax Relief as outlined by TIGA, for the UK games development industry in the coming Budget.”

Wilson continued:

TIGA has made repeated representations to the Department for Culture, Media and Sport, to the Department for Business, Innovation and Skills and to HM Treasury, setting out the case for Games Tax Relief. We hope that the support of the Prime Minister will ensure a commitment by the Government to the introduction of Games Tax Relief and so guarantee that the UK video games industry remains world leading.

Brown has also found himself a target of Apple Daily, a Hong Kong publication that has demonstrated a growing propensity for serving up reenacted news stories rendered in 3D computer animations. A new book by Andrew Rawnsley alleges that Brown acted the part of a bully on Downing Street, with contentions that Brown threw a slow-moving secretary out of a chair so he could finish her work himself. It was also alleged that Brown had a penchant for striking the headrest in his Jaguar when angry, which frightened aides.

Apple Daily used just these allegations for its latest immersive news piece.

Nielsen has issued results of a study into the entertainment spending habits of U.S. consumers and the amount spent on videogames may come as a bit of a surprise.

The company queried over 3,000 consumers in all for their check on spending habits and found that 4.9% of all household funds allocated for entertainment were spent on videogame content. Nielsen defines videogame content as new and used games, downloadable content, rentals and peripherals. Videogame content had the sixth highest percentage, trailing activities (dining out etc…), TV packages, hobbies, live events, out of home movies and cell-phone related entertainment. The latter category garnered 5.3 percent.

Among households deemed “active buyers” in the videogame category, the monthly percentage of dollars spent on videogame content almost doubled, to 9.3 percent. Entrants in this category also spent less on magazines, books and newspapers (3.4 percent to 4.2 percent of the full group), but were more likely to buy or rent movies, purchase music and—perhaps surprisingly—to participate in sports activities.

Dollars spent on sporting activities among the “active buyer” of videogames segment was 4.1 percent, versus 3.1 percent from the whole group. The  category comprised 24.0 percent of all U.S. households.

Nielson is prepping a full report on gaming, dubbed Nielsen 360° Gaming Report: United States Market, which will be released in March.

The government of British Columbia, Canada has revealed sweeping new tax credits that it hopes will aid the growth of digital media production within its boundaries.

The BC Interactive Digital Media tax credit for game developers proposes a credit for 17.5 percent of qualifying B.C. labor costs. If approved, the tax credit would go into effect for game development projects beginning after August 31, 2010.

Other planned tax breaks include an increase on an existing tax credit for labor costs of foreign film productions within B.C., from 25.0 percent to 33.0 percent, and an increase in tax credits for digital animation or visual effects from 15.0 percent to 17.0 percent.

Kevin Krueger, Tourism, Culture and the Arts Minister, said about the tax credits, “They will serve to help keep B.C. at the forefront of the North American film and television industry, while providing a significant boost for video game production in our province.”

Douglas Tonsgard, CEO of Next Level Games in Vancouver, offered his take to the Vancouver Sun on what the credits would mean for his game development company:

It will do two things. It will stop job losses that have been happening now, and it will prepare us properly for future growth in Vancouver. Before the tax credit, it didn't make sense to grow your business in Vancouver. I know we will be adding people to our company now.

In light of Ubisoft’s recent unveiling of its new digital rights management (DRM) technology, Savy Gamer asked a variety of game industry people for their take on the current state of DRM.

The responses were varied, and shockingly, seemed to be formulated based upon what role the person in question has within the game industry.

TIGA CEO Richard Wilson on DRM and game packaging:

I think that it should be made absolutely clear on the packaging if games require constant internet connection. In time, this will probably be the case.

The PC games market will probably come to depend on this type of technology. Most consumers will probably not find this to be a problem but clearly they should be properly informed before purchasing a game.

Wilson when asked if publishers should make some concessions to consumers regarding the fact that DRM makes games difficult or impossible to resell:

No. It is not the responsibility of publishers to sustain a secondary market in games. In fact, some game developers believe that their businesses have been damaged by the secondary market in games.

Direct2Drive UK Product Marketing Manager Nihal de Silva noted that his service is “DRM agnostic” and was “happy to work with publishers/developers whose products carry DRM as well as those with DRM free products.”

de Silva was asked if he thought customers would be happy with Ubisoft’s new DRM initiative. He replied, “no comment.”

Developer Cliff Harris of Positech Games, which releases DRM-free games, was asked if he thought a lack of DRM contributed to piracy of Positech games:

I don’t think it has made much difference at all. Maybe a few of the more honest people now buy the game rather than pirate it, but this sort of thing is impossible to measure.

It seems any game, even if its $0.99 has a five hour demo and is DRM-free and done by a nobel-peace prize winning game design legend, will be cracked and distributed on day one by some self righteous teenager anyway.

StarForce’s Deputy Marketing Director Dmitry Guseff was asked how long it typically takes a cracker to bypass StarForce’s DRM technology:

If we take huge titles like “STALKER Clear Sky”, it took them 3 weeks to bypass which is very good result for AAA class game. For example “Mount and Blade” is still holding since the beginning of December.

So, basically AAA titles hold around a month, less important titles much longer. I have to add that if we hadn’t implemented some consumer friendly features those titles would have been held much longer.

While Keith Vaz being mocked in absentia at this week’s eForum roundtable on the state of the UK games industry was a humorous aspect of the proceedings, there were also some deep insights to emerge from the meeting as well.

Jas Purewal attended the forum and wrote up a couple of the more interesting notes on his website. Among them, a comment from Shadow Culture Minister Ed Vaizey (pictured) that if the Conservative party comes into power this year, there would most likely be no movement on creating tax incentives for game developers for two to three years. Vaizey reasoned that a focus on correcting the current recession would take top priority and push any talk on incentives to the back burner.

Vaizey also disclosed his hope that TIGA and ELSPA could work together more closely in the future, or even merge.

More coverage from the forum on the topics of tax breaks, digital distribution and education can be found on this page of Purewal’s site.

A report issued by the Washington Interactive Network portrays Seattle as one of the top three areas in the country for game development.

The firm’s Interactive Media Competiveness Study began by analyzing a dozen of the top U.S. locales for game development: Seattle, Atlanta, Austin, Boston, Chicago, Dallas, Los Angeles, Minneapolis, New York, Salt Lake City, San Francisco and San Jose.

Additionally, six indicators of competiveness were used: number of firms, computer and engineering talent, multimedia and animation talent, educational institutions, cost of living and the cost of doing business.

While noting that “there’s no stand alone leader” across all categories when it comes to crowning the best U.S. city for game development, the report labels Seattle, San Francisco and San Jose as the top three overall, then uses the cost of doing business in California as reason for promoting the Seattle area further to the forefront.

The report cites 2007 data showing the Seattle area with over 150 companies or divisions making games, employing over 15,000 people, with growth of 8.0% from 2003 to 2006.

Washington Interactive Network Business Development Manager Kristina Hudson added:

Today, there is no stand-alone national leader in any particular category of competitiveness - which means this 'title" can still be claimed. If our region is mindful of our incentives and taxes - keeping it fiscally friendly to individuals and businesses - we have a good shot at being THE global center of game development.

Based on Gfk Chart-Track sales data, the Entertainment and Leisure Software Publishing Association (ELSPA) has proclaimed 2009 as the second best year ever for UK videogame sales.

Total 2009 sales, lumping in software, accessories and hardware together, totaled 114.2 million units or £3.311 billion (approximately $5.3 billion U.S.). Broken out, software sales were £1.621 billion (approximately $2.6 million U.S.), while console hardware totaled £1.06 billion (approximately $1.7 billion U.S.). The latter figure decreased in year-over-year results due to lower average prices.

Wii games sold the most units in the UK last year, with a figure of 18.0 million, with PlayStation 3 software sales totaling 11.9 million units. The Xbox 360 was number one for 2009 in terms of revenue, gaining four percent over 2008 to total £459 million (approximately $734.0 million U.S.). No unit figure for 360 software titles sold was provided.

6.7 million hardware units were bought in the UK last year, with the Wii selling the most.

The accessory market contributed 2009 sales of £630 million (approximately $1.0 billion U.S.).

ELSPA Director General Mike Rawlinson commented, “The UK videogames market is maturing – we are not seeing such explosive growth as in 2008, a sure sign that the market is coming of age. Consumers are shopping smarter and gaming is becoming more widespread across all demographics.”

Money spent on videogames has exceeded that spent on films in the United Kingdom, according to number compiled for an article in the Daily Telegraph.

The videogame numbers, according to GFK Chart-Track, show that more than £1.73 billion was spent on games for the 12 months ending in September 2009. For that same period, the UK Film Council reported that £1 billion was spent at the box office and another £198 million was spent on DVD and Blu-Ray titles. Only music and television had a bigger year than videogames.

Tom Watson, a former cabinet minister and avid gamer, wasn't surprised by the numbers:

"Like anything digital, Parliament has a very narrow view of video games. Too many politicians think video games are played by teenage boys staying up all night shooting things in their bedroom.

"And yes there are plenty of those, but there also a huge range of people of many different ages who love playing games. The industry has matured over the last decade, and so too have gamers."

What makes these numbers even more impressive is that they do not include the sales figures for Modern Warfare 2, which came out in November.

Industries immune to the economic downturn were few and far between in 2009 and, unfortunately, videogame startup companies dependent on venture capital were not one of them.

Venture Beat reports that funding was infused into 97 videogame startups in 2009—to the tune of over $600.0 million—respectable figures, but well off of 2008 figures. 2008 tallied a little over $936.0 million in startup capital for 112 companies, meaning 2009 was off about 36.0 percent.

The year-over-year drop would have been much worse (55.0%) however if Zynga had not raised $180.0 million in a deal earlier this month.

Averages were also down: in 2008 the average capital raised was $8.3 million per company; in 2009 that figure dropped to $6.2 million.

Venture Beat goes on to list all 97 companies and their dollar amounts raised, where known. The top 5 were Zynga, Playdom, Smith & Tinker, PopCap Games and Zula.

As pointed out last week, The Screen Actors Guild and its members are still without a contract with the videogame industry for voiceover work. SAG membership rejected an identical contract approved by the American Federation of Television & Radio Artists in October.

However, an article in The National takes a closer look at the dispute, asking in its headline if the videogame industry is playing fair.

From one SAG member:

“Before, you were doing three characters dying a horrible death. Now you’re doing 20 characters dying a horrible death,” Dee Baker, a veteran voice actor, told the Los Angeles Times this month. “Not only will this mean less money for more work it’s also going to be a lot more vocally difficult.”

The story delves into how much money videogames have raked in over the last few years and also looks at the writing that goes into the stories of the games: a "very, very long screenplay," in the words of Heavenly Sword story writer Rhianna Prachett.

The article points out that SAG is at somewhat of a disadvantage in the talks, which have been relatively non-existent since the deal was rejected:

Actors say the proposed contract means they will have to do more voices for the same money, but the Screen Actors Guild appear comprehensively outflanked. Currently 89 per cent of actors in games aren’t SAG members, while SAG’s sister union the American Federation of Television and Radio Artists has cut a separate deal with the game manufacturers.

Based on the headline, the article obviously takes a pro-SAG viewpoint, one highlighted by this:

In the video-game industry, which grew out of the computer software business, most workers are employees who don’t receive residuals – additional fees for the reuse of their work – as is common in the movie and TV business. And video gamers don’t think actors are worth the extra cash.

“If you look at the total contribution either in terms of hours that go into the creation of a game or the earnings of the people who make the games, voice talent represents a minute percentage,” the lawyer Scott Witlin, who represented video-game publishers in the recent labour negotiations, told the Los Angeles Times.

With AFTRA on board, it will be interesting to see if the videogame industry tries to work with SAG to iron out a contract.

Billionaire financier Carl Icahn has increased his stake in Take-Two Interactive to 11.3 percent, up from 2.5 percent, according to a filing with the SEC.

Icahn, known for his shrewd business moves, has always had an interest in videogame companies, and this latest purchase has analysts specualting on the future of Take-Two and why Icahn purchased his stake at this particular time. His purchase of 5.9 million shares and more than 783,000 options makes him the company's second largest shareholder.

Earlier this year, Take-Two spurned a $25.74-a-share acquisition offer from Electronic Arts. Now, with Icahn more involved, analysts think something is imminent with Icahn looking to cash in on undervalued shares. With the announcement of Icahn's purchase, Take-Two shares jumped more than 9 percent on Friday to close at $9.01.

According to a Reuters story, analyst Michael Pachter, who montiors the industry for Wedbush Morgan, said that Icahn may force a sale of Take-Two:

"I don't think as an activist he wants to run a company, I think it's much more logical that he would sell the company," Pachter said.

Pachter also said that Icahn has a history with Take-Two chairman Strauss Zelnick, whom Icahn nominated to the board of Blockbuster in 2005.

Another scenario, according to analyst Mike Hickey of Janco Partners, is to sell off parts of the company, such as 2K Sports:

"There's the opportunity to unlock some significant value, they could look at the pieces of the business," Hickey said.

It will be interesting to see what Icahn has planned for the company and how it impacts some of the company's most reconizable franchises, such as Grand Theft Auto and BioShock.

The Screen Actors Guild (SAG) still hasn’t ratified a deal with the videogame industry for voiceover work, which could mean more opportunities for actors in the American Federation of Television & Radio Artists (AFTRA) camp.

Variety reports that current SAG talks are still stalled, with little chance of any forward movement in the near future. Akin Gump attorney Scott Witlin, who is handling the game industry side of the negotiations, said, “We’re still in a state of assessment.”

Videogame earnings for SAG members plummeted 56% last year to $2.77 million notes the article, an extremely small slice of the $2.0 billion earned by SAG members overall. It’s also estimated that 75.0% of all videogame voiceover work is done by non-union workers. In light of no SAG contract, it is expected that more AFTRA members will be utilized within the 25.0% of those unionized.

As detailed earlier, SAG’s rejection of a deal has hinged on pay levels for those providing “atmospheric” voices in games. A proposal called for allowing actors to voice up to 20 atmospheric (or non-main character) voices with up to 300 words per voice in return for pay of around $800 per day. The opposition claims that this would lead to actors doing more work for less money.

AFTRA okayed its deal with game companies back in October.

Falling stock prices and threats to traditional business models (digital distribution & social games for example) have made videogame companies ripe for takeover by media conglomerates.

A column on Fortune discusses the lure of such takeovers for Hollywood-type companies, but cautions that it’s a buyers market and that the conglomerates should be in no rush to pull the trigger:

But there's no rush. Next year isn't shaping up well for the gamers so they may get cheaper. EA will be releasing 30 titles, down from 50. Take-Two, creator of Grand Theft Auto, is expected to report its fourth losing year in the last five. THQ has no breakout hits on the horizon, Wells Fargo notes, and faces another difficult year.

Shares of Electronic Arts and Take-Two Interactive are down 70% from previous highs, while THQ is off 90% the column notes, adding that the current combined enterprise value of the three companies is around $4.0 billion.

EA’s bid to take over Take-Two should serve as a further reasoning behind a wait and see approach for companies like News Corp., Time Warner and Viacom:

But big media can wait. Indeed, it need only look at the bullet EA dodged when it stepped back from a $25.74 a share hostile bid for Take-Two in 2008. That's over three times Friday's closing share price.