West Asia crisis threatens Saudi Arabia's $38 billion video game push

By Cecilia D'Anastasio

 

War in the West Asia is causing concern for the people behind Saudi Arabia’s plans to invest $38 billion to become a global video-game hub.

 

“It’s obviously not helpful for the region to have this escalation and it will change probably or cool the perception of it as being a stable and quiet place where people want to go,” Savvy Games Group Chief Executive Officer Brian Ward said in an interview at the Game Developers Conference in San Francisco Wednesday. 

 

Longer term, Ward believes the region will still be a destination for consumers and investors, when the fighting is done. “Hopefully it will be short lived and we’ll get back to business,” he said. 

 

 

Savvy, a division of the Saudi Public Investment Fund, is aggressively investing in infrastructure to attract the world’s 3.6 billion gamers to the country for competitive esports and other events. 

 

Those plans include a gaming district within Qiddiya City, an entertainment destination being constructed near Riyadh, where Savvy is based. Dubbed “the first city built for play,” Qiddiya features amusement parks, golf courses and studios for creative work. It also includes arenas for video-game competitions. 

 

The tourism initiative has seen some success, with three million visitors across the Esports World Cup’s seven-week run in 2025. 

 

Recent attacks on Saudi Arabia by Iran are impacting business leaders’ faith in the country’s goal to grow into a cultural centre for video games, sports and entertainment — a multi-pronged plan to diversify away from oil dubbed Vision 2030.

 

Savvy has invested more than $13 billion so far, including $2 billion in esports infrastructure. The company has plans to grow domestic video game studios and attract international talent. One of Savvy’s goals is “to try and encourage foreign investment” in the Saudi games industry and “to get big companies to move there, bring leadership and create jobs,” according to Ward. Savvy’s Steer Studios, based in Riyadh, employs about 90 people.  

 

The kingdom’s geopolitics put it in a good position to lead investment in both the rapidly-growing Chinese gaming market as well as the Western market — especially as US officials examine Tencent Holdings Ltd.’s video-game business over potential security risks.

 

Today, 35 per cent of Savvy’s revenue comes from the East, according to Ward. He hopes to bring that to 50 per cent.

 

The Public Investment Fund is also the lead investor in a $55 billion buyout of Electronic Arts Inc., the company behind video games like Battlefield, The Sims and Madden NFL. The deal should close “sometime this summer,” Ward sad, adding that Savvy is not involved directly. However, it’s a “possibility” that EA could move under Savvy one day.

 

The fund recently transferred its positions in billions of dollars in gaming stocks to Savvy — a move Ward said could generate liquidity to fund more acquisitions.

 

Savvy’s not alone in worrying about the war. Wynn Resorts Ltd., which is building a casino in the United Arab Emirates, said Wednesday that it resumed construction after a short pause tied to the fighting. Hotels, apartment buildings as well as military targets have been hit throughout the region.