Interactive digital media (IDM) is a $3.8-billion industry in Canada according to a report released this week, and a large majority of the companies surveyed are projecting future revenue growth.

The Canadian Interactive Industry Profile 2012 delves into the economics of those that are in the business of creating digital content for the purposes of entertainment, information or education. It was presented at the Interactive Ontario’s X-Summit programming at nextMEDIA on Tuesday.

Though the study uses data from 2011, the findings are still relevant, says Serge Landry, CEO of the Canadian Interactive Alliance / L ‘Alliance Interactive Canadienne (CIAIC). The projections that came out of it – like those in the gaming industry – hit the “bullseye” for 2012, he says, which proves the projections are on point for this past year as well.

Part of the reason the study took so long to consolidate is because of a revised methodology from reports released in 2006 and 2008. The change includes a narrower definition of the IDM industry, excluding “enabler” firms such as software developers, distributors and service providers that don’t have a direct impact on the products or services that users participate in.

Despite the difference, Nordicity, the analytics and consulting firm in charge of the data, came up with a methodology for comparing some top-line findings from the 2008 CIIP report. What this showed is that although the total revenue in the industry grew by 59%, the total number of jobs fell by 4%.

Landry says this could be because of a shift in the industry towards contract work.

“Right now there’s more and more freelancers working on contracts so they’re not counted as much in the total headcount,” Landry says. “They’re still working on the industry but on a different role.”

Gaming represented the largest chunk of revenue – about 43% – for the core IDM companies surveyed in the study. And it’s an industry that’s growing.

“The bread crumbs are falling from these big studios,”  Landry says. “Some senior developers finally wants to take their destiny on their own hands –  submit a project to CMF and get funded. That whole chain of events can assure a steady growth in revenues,” he tells Playback.

“Just last week when CMF announced the financing for the Experimental Stream in Quebec … two of them were totally new for me. And I know almost everybody in this industry.”

Other key findings:

• Just over 80% of companies projected at least 10% growth in revenue over the following 12-24 months and more than half (56%) project revenue growth of 25% or more over the same period.
• There were approximately 1,684 core IDM companies operating in Canada as of 2011, the majority of them concentrated in Ontario, British Columbia, and Quebec.
• Mobile devices were the most targeted platform, with 75% of companies creating core IDM products for mobile platforms
• Almost 57% of revenues generated in 2011 were directly related to export sales, with U.S. being the largest market
• The biggest limiting factor for growth in the industry is lack of affordable capital, followed by the availability of senior management people with technical digital skills, monetization expertise and cross-platform development