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Seattle skyline. Photo by Kevin Lisota.

To say that the interactive media industry has an impact on the Washington economy would be an understatement.

According to a new study from Seattle’s Economic Development Council (EDC), companies that develop games and make applications generated $36.3 billion of total revenue — direct and indirect — during 2013 alone.

The interactive media industry, as defined by the EDC, includes companies like Microsoft, Valve, Bungie, PopCap, and Big Fish — the latter of which was acquired last week for $883 million. Here’s the EDC definition, with a visual example below:

The definition of Interactive Media is ever evolving. In the past, Interactive Media was defined by video games, networked software applications, digital music distribution and other Internet technologies. Today, the proliferation of devices, the ubiquity of screen-based content delivery and cloud services provision was widened the breadth of companies considered part of Interactive Media. Increasingly, the industry is typified by companies who develop and distribute games, applications for mobile devices and tablets, and provide services online including advertisers and retailers. Software development, web development and design, and animation are key occupations in Interactive Media.

interactivemedia

The EDC also noted that the industry paid nearly $6.1 billion in wages in 2013 (average employee annual salary of $91,000) and created 76,000 jobs — either directly or through multiplier effects.

To reach the $36 billion statistic, the study used the IMPLAN model to measure economic impact of the interactive media industry. It noted that the impact “extends beyond jobs and revenues created directly by its member companies,” including increased business activity for suppliers and consumer industries that benefit from household purchases made by industry employees.

Screen Shot 2014-11-16 at 8.18.01 PM“The IMPLAN Input-Output model for Washington, built on detailed information about the spending patterns of businesses and consumers, quantifies these linkages and calculates an estimate of the broader economic impact on the State,” notes the study. “The model accepts the input of direct revenues and applies industry-specific multipliers to generate total economic impact metrics of employment, labor income, and revenue.”

The EDC credited the industry success in part to Washington’s favorable tax incentives and a talented workforce that has attracted out-of-state interactive media companies like GoDaddy, Oculus VR, Jawbone, and others who have set up satellite offices in the Seattle region.

Washington’s gaming climate is particularly strong compared to other areas in the world. From Microsoft to Valve to countless indie studios, Seattle is chock-full of game developers and designers who produce title after title.

Churchill Downs bought Big Fish. GeekWire Illustration; Photo by Jeff Kubina, via Flickr.
Churchill Downs bought Big Fish last week for $885 million. GeekWire Illustration; Photo by Jeff Kubina, via Flickr.

Big Fish COO John Holland made it clear that Seattle is king when it comes to gaming during a panel discussion last year.

“A lot of people like to think that Silicon Valley carries some of that weight, but the reality is that this is the epicenter of gaming, whether it’s casual or core or mobile or PC or console,” Holland said. “The community here is alive in spades. …There is no doubt that this is ground zero for games and will continue to be for a long time, thanks to the esteemed accomplishments of our colleagues.”

Speaking of esteemed accomplishments, Holland’s own company, Big Fish, was just acquired for $885 million by Churchill Downs Inc., a publicly-traded company with interests in online horse wagering and slot machines. The acquisition marks one of the biggest in Seattle’s vibrant gaming community, joining the ranks of IGT’s purchase of DoubleDown Interactive for as much as $500 million in 2012 and EA’s purchase of PopCap Games for up to $1.3 billion in 2011. It also helps cement Seattle’s role in the social casino gaming space.

The study was conducted by Seattle-based research firm Community Attributes. See the full report here.

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