Depa aims for B30bn digital content space

The Digital Economy Promotion Agency (Depa) aims to drive Thailand’s digital content industry to exceed 30 billion baht in 2019 through tax incentives and other stimulus measures.

Gaming is the largest contribution, followed by animation and character business.

“Thailand’s digital content industry is expected to grow by 13-15% in 2018-19 to surpass 30 billion baht next year, driven by growth of outsourcing production and domestic consumption,” said Nuttapon Nimmanphatcharin, president and chief executive of Depa.

Depa is now considering how to stimulate industry growth through the use of tax incentives for foreign animation companies whose productions are in Thailand to be given a 20-30% return on their investment.

The plan would have to be approved by the Board of Investment.

To stimulate domestic demand, Depa plans to issue digital content vouchers for corporations that use or hire Thaimade characters, animation content or games for a tax reduction.

Depa also plans to do co-production on large-scale projects of at least 100 million baht per animation feature.

Without a government stimulus programme, Thailand’s digital content industry is forecast to grow by 13-15%, with animation, game and character business reaching 27 billion baht in 2018 and 29.3 billion baht in 2019.

Animation is expected to grow by 2% in 2018 and 4% in 2019, while the game sector will grow by 9% in each year. Character business is tipped to grow by 12% in 2018 and 11% in 2019.

The statistics come from a survey commissioned by Depa and conducted by IDC Thailand in collaboration with the Digital Content Association of Thailand, the Thai Animation and Computer Graphic Association, the Thai Game Software Industry Association and the ACM SIGGRAPH Bangkok Chapter.

Thailand’s digital content industry saw 14% growth in 2017, totalling 25 billion baht in revenue, mainly driven by gaming’s 20 billion baht in revenue and 18% growth.

In 2017, animation sector was worth 3.7 billion baht, down 4% from the previous year, due to shorter times for Thai animation in TV broadcasts and a shift to video on demand.

The character market increased 16% to 1.9 billion baht, thanks to the growth of Line stickers and corporations spending to create their own characters.

Animation nonetheless is growing as an outsourced service at many big local studios.

Import and distribution of animation series declined 16% in 2017 and fell by 6% in 2018 and 1% in 2019, due to changes in platform.

IP-owned animation is still the smallest portion, at 86 million baht in 2017 and 94 million baht in 2018, due to a shortage of capital for production.

In the gaming area, local games had only a 5% market share or 19 billion baht in 2017 out of a total of 398 million baht.

The highest growth in gaming business was in imports, which saw 19% growth to 18.5 billion baht, in particular mobile games, worth 12 billion baht, and PC games, at 5.2 billion baht.

In the character business, imported and distributed traditional and digital licences grew by 15% to 1.79 billion baht. The IPowned characters declined from 91 million baht in 2016 to 78 million baht in 2017. Thai-created IP characters grew from 44 million baht to 46 million baht in 2017.