MFG: VFX and Games Industry in BW is Young, Successful, and Growing Rapidly

Baden-Württemberg has become the most important location for animation and VFX in Germany. This is the core message of a new study by Goldmedia, commissioned by MFG. The success of funding is also visible in the games sector.

However, the successes in the games industry were already evident in previous evaluations by the Game association regarding the most popular gaming locations in Germany. For many years, Baden-Württemberg has ranked behind Bavaria, North Rhine-Westphalia, Berlin, and Hamburg—by far the four largest games locations in Germany. Baden-Württemberg certainly owes its status as the undisputed leader of the chasing pack to the funding policies of MFG Medien- und Filmgesellschaft. MFG has been providing targeted support for the games industry for many years, with its budget steadily increasing. However, the southwesternmost state of the republic is even stronger in the fields of animation and visual effects (VFX).

To reinforce this status—and perhaps also to demonstrate the impact of its funding—MFG has now presented a new study conducted by the Berlin-based market research company Goldmedia. The study is based on industry surveys concerning revenues and developments in 2022.

The most significant message of the study for MFG is undoubtedly this: Baden-Württemberg is the leading location for animation and VFX in Germany. There are 85 companies in this industry in Baden-Württemberg, employing 2,550 people. By way of comparison, according to Goldmedia, in 2022, Bavaria had 40 companies employing 1,200 people in the animation and VFX industry, Berlin had 65 companies employing 1,950 people, and North Rhine-Westphalia had 43 companies employing 1,300 people.

According to MFG, its position at the top of Germany’s animation and VFX locations is mainly due to its funding policies. Although Baden-Württemberg spends only half as much on (film) production and VFX as Bavaria, Berlin, and North Rhine-Westphalia, more than half of its funding is allocated to VFX and animation projects. In fact, Baden-Württemberg invests more in these two areas than Bavaria, Berlin, and North Rhine-Westphalia combined.

"In 2014, we were the first federal state to introduce a highly effective funding instrument specifically tailored to the animation and visual effects sector, thereby creating the conditions for the high growth of this industry," says MFG managing director Carl Bergengruen.

According to the Goldmedia study, the games sector in Baden-Württemberg is also developing positively, even if it still lags behind the other federal states mentioned here. In 2022, the games industry in Baden-Württemberg generated a total turnover of 190 million euros. Of this, 113 million euros came from games publishing, 55 million euros from games development, and 9 million euros from games services. The remaining 13 million euros in revenue were not further classified.

The sources of these revenues are noteworthy. Seventy-eight percent of the revenue was generated by in-house productions, while 13 percent came from orders from other EU countries and 7 percent from Germany. Most of the commissioned work was for clients in the audiovisual media sector. For MFG, this is an indication that the games industry is also benefiting from the success of the VFX, animation, and film industries in Baden-Württemberg.

In the later stages of the analysis, Goldmedia also examines the most important company figures, the funding programs offered by MFG, and the industry's needs. The study also compares Baden-Württemberg with other national competitors like Bavaria, Berlin, and North Rhine-Westphalia, as well as international VFX/animation hubs such as Paris, Greater London, and British Columbia, Canada.

The complete study (in German) can be downloaded from MFG's website.