This article is by Sebastien Darchen, a lecturer in planning at the University of Queensland. It first appeared on The Conversation and is re-published here with permission.
analysis For many years, the Australian videogame industry has been trying to carve a niche for itself internationally. There have been moments of success and moments of decline, but the sector’s true potential has never been fulfilled. But could we now be on the verge of a sustainable videogame industry in Australia? It would seem so – and, to be honest, it’s about time.
The nation’s game industry emerged in the late 1980s and experienced significant growth in the next decade-and-a-half, with the establishment of many game development studios. These studios were located mainly in Brisbane and Melbourne. They included (in Brisbane) studios such as Auran (1995), Wildfire Studios (1995), Krome Studios (1999), Pandemic Studios (2000) and Halfbrick Studios. In Melbourne they included Torus Games (1994), Tantalus Interactive (1994), and Blue Tongue (1995).
But the past few years haven’t been great for the industry, with several pioneer studios in Brisbane, Melbourne and Sydney closing their doors. Among these are Pandemic Studios in Brisbane, which closed in 2009, Krome Studios, which closed in 2010, and THQ’s Brisbane and Melbourne studios, which shut down in 2011. There are three main reasons for the downturn in this sector:
- The rise of the Australian dollar
- Tax breaks for game developers overseas (for instance, the Quebec government in Canada subsidises 37.5% of videogame studios’ payrolls)
- The decline of middle-ground games (that is, games that fall between triple-A titles – such as Call of Duty: Modern Warfare 3 – and smaller, independent games, such as Flight Control).
These challenges collide with the fact that, according to the Interactive Games and Entertainment Association’s (IGEA) Digital Australia 2012 report, 92% of Australian households have devices for playing games (compared to 88% last year) and that Australians spent $1.7 billion on videogames in 2010.
But Australia respresents only 2% of the world market, so Australian game companies need to export if they want to survive. One primary concern with the closure of keystone studios in Australia is the fact many professionals, or “talents”, are leaving to find work overseas. All of which raises the big question: where to from here?
If we look at interactive entertainment in Australia in 2006/2007, the industry’s total income was A$136.9m, with A$116.9m (85% of income) coming from the provision of services to other businesses. Of this service income, 93% came from overseas sources. In comparison, the film and television industry relies less on fee-for-service work.
The film and television industry in Australia has experienced more government support than the video game industry because it employs more people: 13,844 people in June 2007 compared with 1,431 workers in video games. (These 1,431 people were spread across 45 game development businesses, located mainly in Queensland and Victoria.) The fact the Australian game industry was mostly relying on international game studios and publishers (which is especially true for Queensland) is one of the main weaknesses of the industry.
Victoria has been the most proactive in supporting the industry and it was the first Australian state to provide government funding for its game industry in 1996. In 2000, it launched Game Plan, a statement of support for the computer game industry, followed by Game Plan: the Next Level in 2001. With the creation of Film Victoria in 2001 – which administers the Digital Media Fund – Victoria has a long tradition of supporting the videogame industry.
Videogame studios have also had support in Queensland, but to a lesser extent than in Victoria. At the national scale, the Game Developers’ Association of Australia (GDAA) has four objectives:
- To promote the growth of the game industry in Australia
- To represent the interests of GDAA members
- To attract capital and publishers from offshore
- To retain and attract talent in our local industry and to promote a sense of community within the industry.
Since 2006/2007, the make-up and focus of the sector has changed. There has been the closure of studios focusing on console games, and the emergence of many independent developers specialising in online games and games for mobile devices.
As one representative responsible for the game industry at Multimedia Victoria told me: “Our strategy is now to encourage local game developers to develop their own IP [Intellectual Property] through the Digital Media Fund. Australia has never been able to deliver a huge triple-A title … our aim is now to nurture the local industry, even though we are still active in trying to attract international video game companies. The objective is to develop a sustainable video game industry”.
The State of Queensland (through the Department of Employment and Economic Development) is also trying to adapt its policies to the recent changes in the industry. A government ICT business advisor told me: “The attraction of large studios won’t be our main focus … we see the mobile [games for mobile devices] as the way forward … we are also starting to look at the Asian market [Korea, China] … why not try to swap IPs from one country to another, take a successful Australian mobile phone game and ‘Koreanise’ it for the Korean market?”
While there are obviously plenty of opportunities to develop a sustainable video game industry in Australia, the key appears to be an ongoing dialogue between industry and policy advisors at a state level, and an association such as the GDAA. The Australian game industry should “play” with its strengths (local talent, proximity to the Asian market, expertise in online gaming and mobile games, competitive university programs in computer programs, etcetera).
It needs to make the move from being a “contender” to being an international hub for the video game industry.
This article was originally published at The Conversation. Read the original article. Image credit: Mykl Roventine, Creative Commons
Wow, flash back to Jason Hills articles there. Sorry, but it reads like every article I have read for the last 4 years. “Oh yer, studios are closing left right and centre, but there is this huge new mobile gaming industry”
That new industry has far less people in it. It isn’t new, those companies are small compared to what was about. They handle mobile versions of titles to release along with the console versions for like 10 years. They survive because they are small. A hit mobile title will make them millions. Millions is enough to fund a big studio for a couple of months.
Not saying the mobile industry isn’t booming now. But articles like this have been written over and over for years as the industry dies.
Most mobile companies also do nothing to keep talent in Australia. You either want to stay here and want to keep doing games desperate because they pay peanuts and most work is contract. They mainly go after graduates that they can get working 12-16 hour days to be in the industry or experienced guys who don’t want to move overseas and haven’t moved into other areas. Contracts like that work out at under $50K a year, with no holidays, no super, no sick leave, etc, are common.
Not the industry you want to work in if you want a house and family.
Oh, I forgot to mention. A lot of those companies still about are their because of the dishonesty of their management. It seems to be a common practice to go broke, leave the employees without a cent and waiting to get payed out by the GEERS scheme. Mean while the other company that was setup months before the company went broke continues to work on the same project with the same key staff and employs a whole new bunch (even sometimes the same people) to continue the work. One mob has done this at least 3 times already.
I agree with Noddy, everyone’s very quick to jump on the mobile bandwagon these days. That market is getting saturated and it’s getting harder and harder to get your small game noticed without paying someone like Tapjoy to promote it for you.
Students coming out of the AIE are only learning about mobile game development and once it becomes clear that the mobile market is flooded they’ll struggle to find jobs. I recently visited their graduation showcase and a small percentage of the students appear to have picked up the skills to work on anything other than the Unity engine.
What we need in Australia is proper federal government support. We need to have the film tax break extended to cover games as well to make us competitive with Quebec. What we don’t need is state governments paying lip service to trendy buzzwords.
The government makes a big song and dance about providing support. I think the peak was near a million in a year spent helping fund games. 50-100K doesn’t go very far. Also they don’t exactly make wise investments. The agreements usually consist of milestones that must be reached by the title. I have seen a few cases where “games” were developed to meet those milestones with no intention of ever doing a complete game. In fact there is no game, it’s a mock up requiring minimum resources to achieve what is needed to pocket the money. Part of the reason is you have a lot more chance of getting money to suggesting an Australiana product. Make it as lavish as you like because you have no intention of ever really making the game.
I am sure Film Victoria remembers their foray into games in a less than fond manner. How’s Beast Ball going guys? The game where Australian Native animals play football. What? It was never finished? I wonder why.
Key quote from the article: “Australia respresents only 2% of the world market, so Australian game companies need to export if they want to survive”. Hence you should not be specifically targeting an Australian audience with a game… if it sells here, great, but we’re a drop in the ocean.
Krome did meet some success with Ty the Tasmanian Tiger… but that seems to be an exception, rather than the rule.
Oh, for sure. Unless you are realy small you can’t do Australian games except for something like an Aussie footy game. Not a gimmicky one. One that appeals to the footy fan.
I thing Ty just hit the Ratchet and Clank clone spot and those style of games were popular at the time. Nice quirky sort of game but to be honest played like crap.
What’s the going deal at the moment for the AIE graduate? It used to be they were snatched up by people like Thatgame / IR Gurus / Transmission games / Trickstar or who ever they have Pheonixed into now days.
I am not sure why the government never investigated them. Just before the end of a large project they would stop paying their employees, promising to pay them when the game was finished. Go broke just as it finished, the employees were left with no money. The next day the new company would be up and running with the same managers as the one that just went broke. Rinse repeat.
Are there full time places? Contracts? Are they offering decent money yet?
About the best a graduate can hope for these days is a position at Half Brick… as to the money, I have no idea.
Lets hope they can keep going. They were a small company on the verge of going broke for a long time. They lucked out with fruit ninja, but there are only so long it and offshoots of it will last.
(I say lucked out as every game is a gamble to some extent and they have had really only one big hit that is funding them, for the time being) But then again companies have always beem roller coasters. Even Melbourne House who I was lucky to have worked for for many years (they started in the 70s). It took Krome to kill them in the end but they went from having hits and big expansion to shrinking and trying to survive on I’d say a 4 year cycle.
No, the Australian Games industry has no future, not while the Government continues to treat it like it doesn’t deserve to exist, while those flogs over in the Automotive industry who are just looking for an excuse to get the fuck out of here apparently do deserve to, and thus have obscene amounts of money thrown at them that they’ll just piss into the wind anyway.
The problem is these developers made crap games when left to their own devices.
Inevitably this forces them into making loads of licensed shovelware games and eventually that means they lose these contracts to places in Asia or where the currency/tax breaks are better.
Pandemic’s games weren’t great. When the best 2 games they made were in 1999 and 2000, it tells you a lot.
Auran lost millions on Fury.
“licensed shovelware games”
Are you in the industry? I don’t think I have heard the term shovelware outside it.
Scrap that, after a web search it seems to be in common usage. Most of my friends and therefore gamers are from the industry and we’d been using that term for 20 years or more. I guess I am not exposed to enough non developer gamers.
“The problem is these developers made crap games when left to their own devices.” That is very true now. Unless overseas studios fund you on a big title all they can do is use the money they may have made on crapware. Unfortunately there are very few talented designers in Australia. Hey there are some guys who are great. But it has to be a bit lucky if they get to do the game. Some of the studio heads haven’t been the best judge of talent, a lot aren’t (weren’t) even gamers.
Unless I’m very much mistaken I find the excuse of the high Australian dollar a moot point. I don’t recall in 1999, when the AUD was at a significant low – 65c – against the USD, a large jump in games developed in Australia.
Hollywood wasted no time jumping on board to make films here back then (think The Matrix, M:I-2 etc). However, it does have me questioning what deals were done between key players (including the government) to get those films made here.
I’ll go out on a limb and say that industries in impasse (or decline) require nurturing for the eventual (and inevitable) end of the mining boom. This might bring the naysayers out of hiding but the NBN could also be a key factor in all of this.
“Unless I’m very much mistaken I find the excuse of the high Australian dollar a moot point. I don’t recall in 1999, when the AUD was at a significant low – 65c – against the USD, a large jump in games developed in Australia.”
1999-2004 or so were boom times, studios greatly expanded in size. The dollar got down to low 50s in 2002 or 2003. New studios were being opened to US companies or being bought out. Tonnes of work was coming in. I don’t know what your basing your idea that there wasn’t a large jump, but I was there an there was.
You need to get decent lobbyists working for the industry in Aus. Here in Scotland – pop 5m – we have a sustainable games industry because we have strong Scottish government support. Games companies here regularly get £m of funding from or with government backing. We also integrate training and development – I am an academic and a games developer.
Noddy, Mike and Bob…well said! The fact is Aussie developers just can’t churn out a good game. But people are more aware of what goes on in the industry than say 12 years back. I remember the time I went for an interview at IR Gurus (back then). One of the artist I spoke to was great during the first interview, like talking to a fellow colleague in the know. Then came the second interview and that was anything but pleasant.
Was interviewed by one of the three owners. He is a jerk all the way…first thought I wanted to sell him some flowers and tried to show me out the door- then when I told him I was there for the interview, couldn’t find my resume and just started the interview like an interrogation and kept a holier than thou attitude the whole time. There were two other members in that interview but seemed scared to speak out because of this owner.
Another interview with another company, the guy kept photocopying my work and said it was part of the interview process (more like trying to get free ideas) and said he will call me back but never did.
Just be careful of your intellectual property and dignity! There are a lot of terrible people in the industry…not only do they have no talent, they have no decency.
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