Poland Is Gaming Its Export Economy — Literally

Source Composite Sean Culligan/OZY

Why you should care

The next big video game you play might be made in Poland.

It all started with a computer borrowed from a high school.

In the early 1990s, just after the Communist regime collapsed, not many in Poland could afford their own PC. Certainly not the Miechowski brothers, who were born to working-class parents in Lubin, in southwestern Poland. “Grzegorz, my older brother, had some ideas for his first game and wanted to work on them,” Paweł Miechowski, a bearded, focused 40-year-old, tells me. “So he brought the ZX Spectrum from his school.”

Some 30 years later, 11 bit studios, a Warsaw-based game development company founded in 2009 by Grzegorz and his high school friend Adrian Chmielarz, was ranked Poland’s third biggest video game company in 2018, with a revenue of over $21 million, four times more than in 2017. Their flagship video games, This War of Mine and Frostpunk, have together sold more than 6 million copies over the world since they were released in 2014 and 2018, respectively.

Their global success is part of Poland’s dramatic emergence as one of the world’s biggest video game creative hubs. The country’s exports of video and card games went up 750 percent, from $95 million in 2012 to $808 million in 2017, according to the latest data from the Massachusetts Institute of Technology’s OEC database, which tracks global trade. In 2012, Poland was Europe’s 13th largest exporter in the industry. Today, it’s the world’s sixth largest exporter.

Video games have indeed the potential to grow as Poland’s flagship export product.

Sławomir Biedermann, Polish Agency for Enterprise Development

According to Poland’s ministry of development, the country now has some 800 registered video game producers. And with global esports revenue expected to cross $2 billion by 2023, Poland’s journey as a major supplier of video games is only starting.

“Our mother didn’t really believe that this kind of business can succeed. I think, after all these years, she’s changed her opinion,” says Paweł, senior partnership manager at 11 bit studios, with a smile.

His explanation for Poland’s surge in the field is simple: “Ułańska fantazja.” This traditional phrase, which refers to the Polish light cavalry from the 18th century, describes untamed imagination, creativity and the ability to take risks.

But there are more practical reasons too. Under communism, Poland — home of the Odra, one of the best computers developed in the former East bloc — rose as an aspiring technology force. With high-quality technical education and widespread popular science, which included Bajtek, the first Polish computer magazine established in 1985, the country unleashed dozens of IT specialists.

With the fall of communism, a young generation, armed with passion, curiosity and knowledge, added a capitalistic sense of entrepreneurship to that legacy. “We started our business in garages, as many in our generation,” Paweł recalls. “But from the beginning, we wanted to turn professional and make a living out of games.”

The biggest name in the Polish video game industry is CD Projekt, with a revenue of close to $100 million in 2018, and the fantasy novel–based blockbuster series Wiedźmin (The Witcher) on its roster. Eight years ago, when Poland’s then–prime minister Donald Tusk gave President Barack Obama the Wiedźmin 2 game during his visit in Warsaw, many saw it as a diplomatic gaffe. But, in fact, it symbolized the birth of a surprising economic success story.

Paweł Miechowski

Paweł Miechowski, senior partnership manager at 11 bit studios.

Source Dariusz Kalan/OZY

Since the first Wiedźmin was released in late 2007, the series of three games and another four spin-offs have sold over 40 million copies around the world. “Wiedźmin opened the door for Polish video games,” says Katarzyna Sacha, market analyst at PMR, a market research firm. “But it has also set the threshold high for other producers, who must now work harder to be able to cope with the Wiedźmin phenomenon.”

Poland’s video game developers are adapting with the times — and to their increasingly global market. Over the years, sales at traditional brick-and-mortar stores have plummeted as more consumers download games. In Poland, 98 percent of games are produced for export, with their plots designed to be understood on the other side of the globe. Teenagers were the industry’s target in the 1990s. Today, a sizable section of the more than 2.5 billion gamers around the world are well-established 30- to 40-somethings happy to pay more for high-quality products.

“The game industry went through maybe the deepest democratization with the introduction of digital distribution,” says Jakub Marszałkowski, head of the Poznań-based Game Industry Conference, one of Europe’s biggest game expos. “Exporting music, movies, cars or shoes is not that viable. Meanwhile, nearly everywhere on the globe, you can produce games and have almost the same access to markets and chances of success.”

Unsurprisingly, the global interest in Polish games has drawn the government’s attention and support. Poland, the only country in the European Union to avoid a recession during the 2008 global financial crisis, is counting on video games as the next fillip to its export-driven economy. At the moment, the video game industry’s contribution to the country’s GDP is negligible. But Poland’s Prime Minister Mateusz Morawiecki has said the industry in the future could “pull the Polish economy up, and the whole country too.”

That’s a view shared by Sławomir Biedermann, a specialist at the Polish Agency for Enterprise Development, a state-run body established in 2000 to help local entrepreneurship. “Video games have indeed the potential to grow as Poland’s flagship export product,” he says. “Relatively easy to promote, they have a strong dynamic growth, and our producers can use the momentum of a booming global games market.”

The big concern? The growth might be too rapid for Poland to manage. Local universities are not keeping pace with the development of the industry, and companies are now complaining about the lack of qualified specialists. Paweł says 11 bit studios must bring in employees from all over Europe, “from France to Ukraine.”

He insists that video games aren’t just another IT sector industry. “Video gaming is something more and requires other skills than just programming,” he says. “We sell stories and emotions. It is storytelling. It is art.”

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