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Stardock Expands, Plans New Title Thanks To Michigan Tax Credits
Stardock Expands, Plans New Title Thanks To Michigan Tax Credits
February 4, 2009 | By Eric Caoili

February 4, 2009 | By Eric Caoili

Software development company Stardock Systems will invest $900,000 in an expansion of its Plymouth, Michigan headquarters that will allow for the development of a new PC title.

This expansion is expected to create 53 jobs at the developer and publisher, whose shipped games include the Galactic Civilizations series and Sins of a Solar Empire. The company was founded in 1991 and currently employs over 60 workers.

Stardock is slated to ship Gas Powered Games' Demigod for PC in March, and plans to release Elemental: War of Magic, an internally developed turn-based fantasy strategy PC game, in February 2010.

The studio is able to fund this growth thanks to state tax credits enacted last April. Though primarily targeting the film and television industry, Michigan's tax incentives also apply to digital media companies seeking help with production costs, infrastructure investment, job creation, and job training.

Several states -- such as Connecticut, Florida, Georgia, and Louisiana -- offer similar incentive designed to attract film and interactive media companies. Europe, Australia, Asia, and almost all Canadian provinces also provide government help for developers and publishers looking to establish local offices.

Michigan's incentives, however, are especially generous, offering up to a 42 percent tax credit for production expenditures against the Michigan Business Tax (MBT), as well as a 25 percent tax credit against the MBT for "base investment" in infrastructure exceeding $100,000.

"The fact that these jobs exist in Michigan today is no accident," says Michigan's Democratic Governor Jennifer Granholm, according to a report from Michigan news site Mlive. Granholm signed into law the bills that provide the tax credits.

"These jobs are here because we put a strategy in place to bring them here - often by beating out other states and other countries to get them."

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David Sahlin
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I wonder how attractive the incentives now look to out-of-state companies.

Tom Newman
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I live in Detroit, and have many friends in California. Cost of living in Michigan is CHEAP in comparison, and this state has a LOT to offer!!! Any developer looking for not only great tax incentives, but also some outstanding real-estate deals should look to Michigan as well!!!

Bart Stewart
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There are some obvious comments that could be made about the smart example for tax policy this sets, but let's let those pass. :)

What is worth talking about is the remarkable contrast between Stardock's success and the layoffs (or worse) occurring in other game development companies. It's very tempting to ascribe some of that success to Stardock's strategic business policies of focusing on developing for the PC platform and eschewing DRM, but it might still be a little early to say that definitively.

Worth thinking about, though.