Saudi Arabia’s Ambitious Move into the $180B Video Game Industry Sparks Controversy

Saudi Arabia’s Ambitious Move into the $180B Video Game Industry Sparks Controversy

Saudi Arabia is making a bold entry into the lucrative $180 billion video game industry, provoking both excitement and controversy. The nation, known for its oil wealth and conservative Islamic traditions, is seeking to transform itself into a global gaming and esports hub by 2030. However, critics argue that the Kingdom’s involvement in sports and entertainment is an attempt to divert attention from human rights abuses and other questionable actions.

Last September, the Saudi sovereign wealth fund allocated nearly $40 billion to establish a conglomerate aimed at making the country the ultimate global gaming and esports destination. As part of this initiative, the fund became the biggest outside investor in Nintendo in February. Moreover, Saudi Arabia recently hosted a high-stakes gaming tournament with a record-breaking $45-million prize pool.

The Kingdom’s foray into the gaming industry has drawn parallels to its involvement in soccer and golf, where it has been accused of sportswashing its human rights abuses. Critics argue that Saudi Arabia, known for its strict punishments, including lengthy prison sentences for online activities, is entering a global community dominated by young and tech-savvy individuals who value freedom of expression.

Some experts view Saudi Arabia’s gaming ambitions as a showcase of wealth and power. Joost Van Dreunen, a professor at New York University specializing in the business aspect of video games, likens it to the Roman Empire’s use of the Colosseum for displaying its dominance. He raises questions about the intentions behind Saudi Arabia’s push into gaming and its architects.

Crown Prince Mohammed bin Salman, a reputed gamer himself, envisions gaming as part of his ambitious plan to diversify the Saudi economy and provide entertainment opportunities for the country’s youth. The Saudi sovereign wealth fund, worth $700 billion, aims to invest $39 billion in the gaming industry, establish 250 local gaming companies, and create 39,000 jobs within the next seven years.

The gaming industry is a massive and rapidly growing sector, generating staggering revenues of $184.4 billion in 2022. Market research firm Newzoo estimates that around 3.2 billion people worldwide play games on various platforms. Gaming eclipses the combined earnings of the global box office, music streaming, album sales, and the top five wealthiest sports leagues.

Saudi Arabia is also venturing into the realm of esports, which attracts millions of fans, celebrity players, and corporate sponsors. Esports tournaments draw massive viewership, with a Singapore event in 2021 attracting 5.4 million concurrent viewers. By investing in esports, Saudi Arabia hopes to advertise its brand internationally and position itself as a progressive and appealing destination for travelers.

However, the growing involvement of autocratic Gulf states, including Saudi Arabia, has stirred controversy within the gaming community. Riot Games, the developer of the popular multiplayer game League of Legends, and Danish tournament organizer Blast Premier both faced backlash from fans and canceled partnerships with Saudi Arabia in 2020. Team Liquid, an esports organization, committed to donating half of its winnings from competitions in Saudi Arabia and the UAE to an organization assisting LGBTQ+ individuals seeking refuge from violence and persecution.

Despite ethical concerns, the lure of financial gains often leads to partnerships between esports and countries like Saudi Arabia. Christopher Davidson, a Gulf expert at the European Center for International Affairs, points out that esports is a globally recognized sport, appealing to a wider audience than traditional sports like English soccer. The involvement of Gulf states presents opportunities for prime advertising and promotes their countries as forward-thinking and exciting holiday destinations.

In conclusion, Saudi Arabia’s ambitious entry into the $180 billion video game industry has generated both excitement and controversy. While the Kingdom seeks to diversify its economy and provide entertainment for its youthful population, critics accuse Saudi Arabia of attempting to sportswash its human rights abuses. The gaming industry’s exponential growth and popularity make it an attractive investment, despite concerns raised by the gaming community. As the Kingdom moves forward with its gaming aspirations, the ethical implications of partnerships and the balance between financial gains and human rights remain key considerations.