With the objective of diversifying its economy, Saudi Arabia is seeking its place in the increasingly lucrative video game market by increasing investments, sometimes unexpected.
Betting on video games and establishing itself as a leader is Saudi Arabia’s major project. The country has had the entertainment sector in its sights for several years. It has invested colossal sums since the first equity investments in the gaming video sector in 2021 – nearly $38 billion, according to The Japan Times. An investment that is not a coincidence.
The Saudi Arabian Public Investment Fund (PIF) notably owns 7.54% of Nintendo (according to a regulatory filing dating from early October 2024) and 9% of Electronic Arts. But it also has its shares in other big names in entertainment: Activision Blizzard (Call of Duty), Capcom (Resident Evil, Street Fighter), Take Two (GTA) ou encore Koei Tecmo (Dynasty Warrior). Investments that will only accelerate, according to the Japanese press agency Kyodo News.
A gradual entry into the sector
It must be said that the fund is expanding its strategy. He is now transferring all his shares into his investment company specializing in video games and esports, Savvy Games Group.
In 2022, the kingdom also acquired the prestigious Japanese publisher SNK (King of Fighters), via Prince Salmane’s foundation. A flagship of Japanese video games, against a backdrop of significant popularity of fighting games in Arab countries.
Ambition and money also give the Gulf country the means to destabilize the entire industry, as when it finally refused a $2 billion deal to Swedish giant Embracer. The turnaround, revealed in May 2023 by Axios, forced Embracer to liquidate a large part of its assets and split into several entities.
And Saudi Arabia’s appetite is growing. In an interview given to Kyodo On the occasion of the Tokyo Game Show at the end of September, the vice-president of Savvy Games Group, Prince Faisal bin Bandar bin Sultan Al-Saud, mentioned “the possibility” of buying more shares in several Japanese video game giants. However, he clarified that he did not want to rush share buybacks by emphasizing “communication that goes in the right direction” with his partners.
Savvy carefully places its pawns, including in emblematic companies like Nintendo. Investments which may surprise, but which now make the Saudi fund the second shareholder of the queen Japanese video game company.
A very long-term vision
This is a turning point in the country’s economy which is gradually turning away from the oil industry to favor digital entertainment. An initiative that is consistent with the Saudi Vision 2030 plan, a plan which aims to diversify the country’s economy, while significantly increasing its global influence.
Often criticized by human rights protection organizations, the Saudi attempt to establish itself in video games could resemble a sort of diversion, with, as a first point of view, the organization last summer of the first ever esports world cup in its capital Riyadh. An event bringing together teams from around the world on different games, with $60 million at stake. The country has also taken over the esports Olympic Games which it will organize between 2025 and 2037.
Above all, Saudi Arabia has been working on the major Qiddiya City project since 2019. This site near Riyadh will be a place of entertainment with the development of a Formula 1 track or a theme park on Dragon Ball. By focusing on video games and esports, the city shows that it also aims to become a stronghold of the video game industry.
