“Video game development has been included among the creative industries at the legislative level,” says Vasily Ovchinnikov from RVI about the results of 2024

What kind of year was 2024 for your organization? What accomplishments would you like to highlight?

This year, we pondered what exactly we do and the specific beneficial steps we take for the industry's development.

Perhaps it's a kind of mid-life crisis. In November, we turned two, and as far as I know, no video game industry association in Russia has lasted this long.

We continue to grow organically: we currently have over 300 members and experts in our organization. We actively invite colleagues from the industry, passionate people ready to participate in its development and stay informed about what's happening.

This year, some negativity arose as we had to decline some membership applications and founder inclusions. The reasons mainly relate to a lack of connection with the industry, insufficient experience, or unreasonable demands of the organization. We value and uphold a high level of expertise within our community.

One of the most significant achievements was attracting the first corporate investments in the industry for indie studios since 2022. Together with colleagues from the IndieGO accelerator, we successfully launched the IndieGO Start fund with the support of "Rostelecom" to support a currently small niche of video game developers. In the coming months, the fund announced the allocation of 300 million rubles to develop at least 15 projects that will receive funding based on milestones, focusing on completing development and marketing. These projects are in a high state of readiness.

Another significant event was drawing attention to the need for industry support, which led to a response from Moscow's leadership and a request for infrastructure investment. This year, the Moscow cluster of video games and animation was announced, set to open in 2025 in "Skolkovo" at the "Stratos" business center. The cluster will occupy about 40,000 square meters. The Creative Industries Agency (ACI) will manage the site, and ODVGI experts will assist in video game expertise, attracting residents, and content development. This is the first specialized video game hub in Russia focused on game development. Its opening is expected in 2025. Currently, applications from potential residents are being collected, rental terms are being discussed, as well as the possibility of applying tax benefits for hub participants under the "Skolkovo Benefits" tax program.

We conducted a major industry study with Strategy Partners (a consulting subsidiary of "Sberbank"), where we calculated the current market volume in Russia in the absence of such data. No similar studies on the Russian market have been conducted in the past three years, and this data often serves as a stumbling block in negotiations with non-venture investors.

Non-venture investors have heard somewhere that video games are profitable and the market is large, but they don't really understand it. Many initially think it's about esports! Now, "Sberbank," via consultants from Strategy Partners, has expertise. In the future, when the economy stabilizes, it might be worth going for a loan. Game projects should no longer intimidate them.

We formulated and updated the "Five-Year Roadmap for Video Game Industry Development" (ODVGI Roadmap). This is currently the only guide for the entire industry regarding declarations and creations. Much is going off plan, but thanks to its presence, the industry looks more transparent and connected.

We initiated a new project to promote video games through a positive "Green Label," commonly called "Green Labeling." Some games have already received this label. We are currently collecting applications for the next batch and negotiating with content distribution platforms, code stores, and storefronts to highlight these games on main pages and search filters. We invite everyone to join this initiative. Next year, we plan to propose the same initiative to colleagues from associations in other countries.

This year saw a record amount of international work. The most interesting: together with ACI, we managed to organize a stand with Moscow studios at the Indonesian IGDX exhibition. Additionally, we brought representatives from the game industry of Indonesia, Brazil, South Korea, and India to Moscow in December. We organized over 12 meetings, showcasing companies, platforms, and studios. Thanks to all the companies that hosted colleagues and considered joint projects. Hopefully, this will bear fruit.

The governments of Russia and China signed a communiqué on cooperation, which included video games. This was made possible thanks to the extensive work of the Ministry of Digital Development's employees, who succeeded in incorporating this clause into the agreements. It's worth noting the participation of ODVGI: we stayed in touch with colleagues all the time, taking part in all commissions, protocol preparation, and so on. Hopefully, the communiqué will aid those currently undergoing the process of obtaining "Chinese licenses."

We visited China several times. We formed a video game stand at the Harbin exhibition and participated in b2b and b2c events in Guangzhou, invited by the Guangdong Province Video Game Association. But there's still a long way to go before ensuring full entry into China, though steps are being taken in this direction. The aforementioned communiqué from the heads of government meetings, which included video games, is a great step forward. We continue to maintain warm relations with our partners. Also, I can note, from what I can disclose: ODVGI member companies managed to sell their software to Indonesia and games to South Korea, all thanks to contacts and links established in 2022.

We are ending the year with a traditional vote in the Hall of Fame of Russian Video Game Legends. This year, nearly 100,000 people made difficult choices not only for games but also for people who made significant contributions to our industry's development. This year also saw a new category for people in esports. We are grateful to "VKontakte," which supports the public vote for the second year, as well as to other information partners.

How has the Russian gaming market changed in 2024?

Regarding the Russian gaming market, which is geared toward users purchasing games, one can note that services for topping up gaming accounts on various platforms have stabilized. Fees for these services have decreased and equalized. Game codes are now officially sold, for example, through "Buka" and resold through VK Play. This has improved accessibility and convenience for users.

The summer sanctions package from the USA included a specific document indicating exemptions for some sectors not under sanctions, including a particular category of eGaming. Thanks to this, many cautiously began working in this field with non-sanctioned companies from Russia. Generally, considering our large market for PC and online games, as well as Steam's ongoing collaboration with Russian developers and users, the crisis for gamers has not been as painful.

Concerning the market's volume, together with Strategy Partners, and with expert help, we managed to calculate the official data on Russian spending in this area. If anyone missed it, you can explore this study for free here.

In computer clubs, games localized by publishers like "Astrum" and "Lesta" were pre-installed. Thanks to cooperation with the Cyberia Nova studio, VK Play launchers with the game "Smuta" were pre-installed in several thousand clubs. This experience may play a key role in promoting not only online free-to-play projects but also in advertising campaigns for single-player games.

The MTS Fog Play service, announced as "fog gaming" within the company, allowing games on Steam to be played on TVs and weak devices by renting capacities from other users for about 50 rubles an hour, with minimal ping, became fully operational. In my observations, the service works technically well, providing a comfortable gaming experience on devices with limited capabilities.

The topic of landing foreign video games and target collections through ERAI, raised by Umar Kremlev at a meeting with the President, could have impacted the market but was ultimately not implemented. The idea was effectively frozen during six months of discussions involving ODVGI, 1C Game Studios, "Lesta," VK Play, and others.

Ultimately, instead of a position from the industry, a bill by a group of deputies was introduced, regulating and limiting the sector. This bill was not discussed with the industry and sets us back years in building relationships between business and the state. Yes, the bill essentially contradicts the President's orders on supporting the industry, the May orders, and instructions given over the past two years.

We promptly formulated the first official position from ODVGI, presented it to the public, added additional arguments, and sent it to the relevant State Duma committee with a proposal to involve industry participants in working on the bill. We sincerely hope other associations will support our position or form theirs. This is precisely the moment when associations must show their activity, but from what's announced so far, all that's heard is "let's work together on the text." Of course, we will work on it, but it would be great to first work on the purpose, meaning, and interest balance, and then move on to the law's text.

In our opinion, the initiative of the group of deputies looks even worse than the proposals considered a year ago in ERAI. Back then, financial support for the industry's development was promised. Now, the main dangerous points, which require special caution, are negative marking, certified experts, and user identification.

However, it's worth noting that closing the mass market for foreign studio products is perceived as a harsh but overall positive step for domestic developers by many in the industry. This rhetoric is not only heard in Russia but also in other countries, where sovereignty, protection from cultural influence, and support for domestic developers in the domestic market are being discussed.

I presume the initiative from the group of deputies owes its lack of negative reaction from the industry to an experiment with additional negative marking, announced in the fall by "Lesta" and VK Play. In practice, such marking requests from the sector evidently did not arise, nor were there insistent demands from the state.

We then had questions regarding the goals of this voluntary marking — is it aimed at industry development or imposing restrictions? We decided not to comment to avoid irritating industry colleagues. If they want to label themselves with black marks, why not? But perhaps if we had criticized it then, this legislative initiative would not have arisen.

New in 2024 for fans and gamers is the resumption of video game exhibitions like "GameProm," "RED," and the revived "GameCon" from Hobby World. Although many well-known Russian studios currently see no reason to participate, I hope the situation changes. In the absence of large projects, these exhibitions may become centers for attracting fan attention to games.

Were there any changes in the domestic game development that were distinctly felt in 2024?

RuStore began generating income for developers. We confidently recommend it to both foreign and domestic studios that, for various reasons, haven't paid due attention to the Russian store. Today, RuStore is the second-largest mobile store on the local market after Google Play and has every chance to become the leader. This is especially relevant in light of recent news that Google Play is halting payments to Russian developers.

On a sad note: the development of the AppBazar mobile store, a partner of MTS, has been frozen.

On the upside, MTS launched the FogPlay service, allowing users to rent out their computers to other players. Games within Beeline's app are developing. I've heard that more companies will experiment with games within client apps next year.

There is also a steady organic growth of browser games on platforms like "Yandex Games" and AG.RU. Recently, many developers are experimenting with their projects on the Telegram platform, which also helps expand audiences and develop the market.

This year, many projects were included in the register of domestic software, especially after the successful examples of pioneers who decided to classify their games as "domestic software" to avoid VAT on sales in Russia. This became possible after a Presidential decree following a meeting with representatives of the creative industries, where Putin humorously mentioned he plays on weekdays.

The Ministry of Digital Development temporarily allowed the inclusion of games developed on Unity, Unreal Engine, and other foreign engines in the domestic software register. Now, if a game is in the register, one can claim savings on VAT in Russia. This measure is temporary and may be canceled at any time, but as long as it operates, it can be utilized. Even if later the norm is repealed or your game is removed from the register, it will only affect future tax periods; it won't impact previously paid taxes.

For the first time, game development was officially included among the creative industries in legislation. It will be interesting to see what benefits this brings to the industry in the future, as, for now, it's merely a mention of game dev as part of creative industries requiring support. Currently, one of the most effective support measures from the state has been IT benefits provided following the recognition of video games as part of the IT-sector. This allowed for lower taxes, preferential mortgages, and exempting a significant number of employees from conscription.

Recently, some new associations emerged, such as the Association for the Development of Esports Infrastructure (AREI), uniting computer clubs, and the Gaming Industry Association (GIA), now representing the interests of the "Lesta" group.

It's worth noting that the trend of association creation, initiated by ODVGI's example, was precisely what we expected from major market players as a reaction. However, we clearly told all our members that there are no restrictions on participating in other organizations. If you see benefits in this, feel free to participate. We are always ready to assist, but remember that "VKontakte" has its administrative resources and, unlike us, currently access to large capital. The main thing is that this benefits your business and contributes to its development.

We work not just in the interest of our members but the entire industry as a whole. Our members, of course, receive information slightly earlier, learning about new opportunities and issues among the first, and we always consult with them before taking any steps. If desired, everyone has the opportunity to participate in ODVGI's work.

This year saw a significant increase in events like conferences with a B2B component. Some started overlapping, for example, "GameDev" in Nizhny Novgorod and "GameProm" in Moscow. We can't attend every event, so we ask our experts and members to step in for us. The same goes for providing media commentary.

Thanks to all this and small awards and contests, small studios with their creative and innovative projects (indie studios) have become noticeable. They represent our future workforce and the foundation for the industry's future if we don't ruin the situation ourselves.

A positive radiation backdrop for Russian game dev is created by 1C Game Studios with projects like "Caliber" and "IL-2," along with new game announcements like "Tale of Old Rus," "Korea: IL-2 Series," and "War of the Worlds: Siberia."

These projects are accompanied by excellent social media content that interests both users and the industry itself.

Notably, CarX Technologies released a version for RuStore and introduced a PC version of CarX Street. The company gained valuable experience, and we hope they share it with colleagues in some way.

What trends do you expect to see in the Russian gaming industry in 2025?

Of course, the most anticipated event should be the appearance of an "Association of Associations," uniting everyone! Just kidding! Although, maybe it wouldn't be such a bad idea. Many government agencies try to assist the industry, and it would be nice if someone helped them navigate. We do this as much as possible, but having someone with state authority and responsible for coordination would be helpful.

Generally, despite two announcements in November 2022 by Deputy Prime Minister Dmitry Chernyshenko and Minister of Digital Development Maksut Shadaev at two different events (Digital Innopolis Days in Tatarstan and "Digital Diamond" in Yakutia) about the need to develop the video game industry in Russia, these visionary theses haven't yet been implemented.

For us, it's also an experience: even at such a high level, disconnected from the industry, such initiatives might not be realized. However, the emergence of games like "World of Tanks," Warface, and Standoff 2 on the "Games of the Future" project can be considered some result.

In 2025, I highly anticipate business expansion, mergers, acquisitions, and possibly even stock market entries. This would greatly invigorate business activity in Russia.

Increased state regulation of the industry is highly likely. We have supported the status quo as much as possible, but excessive initiatives from colleagues eager to gain favor with government structures, promoting and popularizing legislative innovations, only fuel interest in additional regulation. Apparently, we'll all have to play this game. The decisions made next year will only start influencing after a year, so we'll have time to adjust and understand the consequences they bring.

We hope for increased investment volumes. The issue of the departure of industry-specific investors is still unresolved. Although progress is being made, as I previously mentioned, the IndieGo Start Fund, operating as both a systemic non-venture investor and an industry-specific accelerator, is confirmation. Perhaps, within such collaboration, future investments are warranted (at least for co-financing competition winners for which the President allocated additional funds this year for video games). Considering projects will typically need 45-50% co-investments, this money must arise from somewhere next year.

As VK Play did not manage to attract a large audience to the platform, alternative PC platforms might emerge, strengthening Base from "Lesta" and "Fogame" from "Innova."

For the industry in Russian realities, it would be beneficial to consolidate efforts on one such resource. A year ago, I suggested dividing VK Play among 3-4 major publishers, who could abandon their platforms in favor of a shared one. This way, they would channel their audience to a single platform, earning not only from their projects but also gaining a share from the entire market. Unfortunately, no consensus was reached then, though I believe the idea remains relevant.

New from REC: they are preparing proposals for the President and Government to subsidize or reimburse part of the expenses related to entering new markets with content and IT production. This plan is to cover localization, translation, marketing, promotion, participation in exhibitions, and other aspects, including for video game developers. We wish them luck and help as much as we can. We hope the process won't be overly bureaucratic and will persist for several years. If this happens, it could become a useful tool for the industry.

One of the most unusual and controversial events was the Kaliningrad Region governor's proposal to create a domestic video game console. The amusing point is that he led this initiative himself, already being the Minister of Industry and Trade. At the end of the year, the first meetings in a large composition, organized by the ministry — with state representatives and industry members trying to understand this issue, took place. In 2025, various commissions are likely to form, and the topic will be actively discussed throughout the year. We, as usual, gather opinions, share past cases and history of such projects in other countries, attract experts and insist on conducting extensive research and development (R&D) before launching such a project. Thanks to this "news leak," we learned much about which Russian software and hardware manufacturers have video game industry experience. It turned out there are many enthusiasts and some developments in this field.

In 2024, many games supported in 2022 and 2023 through IRI were released, ranging from free educational and children's projects to commercial games with positive content — from visual novels to strategies. In 2024, projects for support were selected with greater involvement from VK Play representatives, which undoubtedly will affect what we see in the future. As far as I know, in 2025, the selection process will be stricter. Independent experts will be involved.

What are the organization's plans for 2025?

Since we haven't yet found systematic funding sources in the market, we will continue that pursuit. We urgently need those who are financially capable and ready to bridge the world of investments and the development world. Singular cases occur, but no systematic interaction is observed. Additionally, it's important to note that stable studios either are not ready to develop competitors or do anything publicly in Russia. We have ideas to break this cycle, which we will attempt to implement.

From organizational innovations: in 2025, we will be ready to consider admitting as founders those studio founders and general directors who have resolved self-identification issues and who openly work in Russia. As you remember, when the organization was initially established, many left or concealed themselves, resulting in funding only coming from those not directly tied to game development, who were less affected by sanction pressures. Now, we openly invite those ready to invest several million rubles a year in public projects and participate in electing the next ODVGI director.

As I mentioned earlier, significant resources and time will focus on participating in discussions and working on the new "Activities Related to Video Game Development and Distribution in the Russian Federation" bill, which was prepared without industry representative involvement. Currently, it seems not only useless but largely harmful. Lawyers are already noting its contradiction with the President's orders for industry support and development. Therefore, most likely, the start of next year will concentrate on discussing this bill and previously proposed initiatives. We will strive to find a compromise and steer the situation in a more beneficial direction, which will surely reflect on our work.

We have been working for over half a year on the industry's "Developer's Red Book," a sort of "Russian GameDev Book" (RGDBook), where we aim to collect everything a developer might need or find useful working from Russia: industry-regulating documents, laws in a comprehensible form for the average developer, helpful information about colleagues and the market. These are the "red pages" meant to replace the "Live Report" on the industry's state, which we maintained for the first two years. The project is voluntary, with those filling the guide with information doing so voluntarily, sharing their expertise. We are progressing slowly but surely and do not reject additional help from the industry.

The opening of the Moscow Video Game and Animation Cluster in "Skolkovo," planned for mid-2025, should become a key infrastructure project. I hope it sparks similar projects in other Russian regions. We will continue to acquaint the video game industry with other industries — movies, animation, books, and beneficial organizations. We will also continue integrating into non-specialized events to familiarize Russian business and the establishment with games.

A major project we're working on with the Hobby World team is the revival of the legendary "GameCon," where we decided to combine tabletop and video games. We see the benefit of such audience intersections for both industries. The "GameProm" team assists us in its organization.

From personal plans: We announced a book about stereotypes around video games in collaboration with "Bombora," set to be released in 2025. The book will be in an easy science-pop style about the harm and benefits of video games for a broad readership. A large team works on the book, conducting research, gathering interesting comments, and conducting short interviews. The book's mascot, helping readers navigate stereotypes, will be a baby elephant named Dendy.