Are you worried about the problems that come with scaling up? There are plenty of cautionary examples of UK developers such as Argonaut or Kaboom! who went bust because they over-expanded.

JK: It's definitely an interesting problem and one I should probably think about some more, but it's not as if we've been actively looking to expand. These have been opportunities that popped up and we've had work we could take on, so the new locations are actively contributing to the whole of Rebellion. Also, although technically we are four locations, soon we will be three. I suppose it is a concern as we move forward. Should we consolidate further, or should we stay as three sites? My feeling is that each of the studios has its own flavour and can add something to the mix.

Oxford is much bigger than the other studios too. It's more than twice as big as the next largest and a lot of our technology is done here, although not all. Each project contributes, so the Derby studio worked on a botanical system for their game - a jungle renderer if you want. They led on that and it got integrated back into our main Azura engine technology, so everyone else can use the jungle renderer. We also have very strong senior management. There's a head of production across all of the studios, a head of programming across the studios etc, and each studio has its own head of production, programming and art.

As for some of those other companies you mention, you get the impression when they looked at the future, they didn't believe the bad times were coming. I think you have to be realistic and you have to make strong management decisions early. But so far, so good. There's no shortage of new projects.

One PSP game currently in development at Rebellion is
Star Wars Battlefront: Renegade Squadron

JK: As the industry gets older, you find yourself in the situation where some of our staff have been with us for 15 years. They have a family and kids at school. As a business owner, you have to be really careful. Sometimes you have to lay people off but you shouldn't do it lightly. You have to think about the ramifications. Suddenly we're not mucking around with young men's lives where if they get fired, they can just fuck off to Montreal and start again. Potentially, if things go wrong, we're affecting our staff, their partners and their children. It's a sobering thought. Sometimes you do think; 'Oh, can we just be small again?'

But there are advantages that come with size. If it's coordinated properly, you end up with something where the whole is greater than the sum of the parts. For example, you can get overlap of technology so we might be doing project A, which is sci-fi shooter, and project B, which is a historical shooter. Some of those technology elements will be the same, so you can reuse them and then focus your production resources to really push the sci-fi and the historical aspects. In that way, both games can benefit more than if you were doing just one game at a time.

JK: We bought 2000 AD because we wanted to rescue it, and because we wanted to continue to make comics and graphics novels. It's a solid business. The bank loves it. Every week it sells 20,000, 30,000 copies, whatever the exact number it is. And we're doing these 300 page monthly reprints of the Judge Dredd stories - The Law in Order. They are selling in high numbers.

We've also got our paperback books imprint, Abbadon. To some degree, we're just mucking around with ideas but it's still creating intellectual property. It's much cheaper to commission a book than it is to make a computer game. In fact, I recently had a TV producer on the phone asking if the rights to one of the books are available. We've done did bits and pieces with movies too, although that's something we've since backed away from, but it was good fun. We made a movie. It got everyone fired up one summer. Lots of our staff got dressed up and it made its money back. But to be honest, 97 percent of our business is making computer games.