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What's Really Going Down in Vancouver?

August 17, 2012 Article Start Page 1 of 3 Next
 

It's been a devastating summer for the game industry in Vancouver, as major publishers closed studios there: Activision gutted Prototype developer Radical Entertainment, while Max Payne 3 studio Rockstar Vancouver up and relocated to an expanded facility near Toronto.

That's far from the extent of it: Ubisoft also closed its Vancouver office, while Capcom, Slant Six and Relic saw layoffs. This city, once such an active game development hub, is seeing massive challenges, and the threat of a talent drain to currently-thriving Montreal and Toronto, where attractive tax incentives are helping compound Vancouver's challenges.

"Back in the glory days of gaming, Vancouver was Canada's 'it town' where things were happening," says Shane Neville, who has spent 15 years in the city's game industry, with companies including Electronic Arts, before going indie. "People were moving here from all over Canada for jobs. With the oil jobs in Alberta and the incentives in Quebec and Ontario, things are going the other way now."

These factors, plus increasing challenges for so-called "mid-tier" console developers, have combined to leave an entire dev community high and dry, and many fear that a lack of government support alongside incredibly high real estate prices may constrain the flourishing of new small studios that usually follows layoffs at bigger ones.

Vancouver's Matt Toner is a game and transmedia industry veteran, professor at the city's Center for Digital Media, and founder of entertainment tech firm Zeros 2 Heroes Media. This year, he's emerged as an advocate for Vancouver's game industry -- and he's running for public office.

Toner says that at the core of the Vancouver industry's current crisis is the fact the government doesn't understand its needs, and just lobbying won't help within a complex bureaucracy. "One of us" is needed at the administrative level, he believes, and he also worries that the government doesn't have a plan to save Vancouver's interactive entertainment industry.

"Games are a big part of Vancouver's ecosystem for innovation," Toner tells Gamasutra, citing the city's history of diverse "screen-based" entertainment, which includes film, television, and mobile entertainment as well as games. Having also lived and worked in New York City, where a traditional triple-A industry has also struggled to take root, Toner says there are major parallels.

But New York has a plentitude of the three elements Toner views as essential to driving this industry: Clients, talent, and capital. "In Vancouver, we have a lot of talent. Clients, not so much, and capital is in short supply," he says.

"There are two things that result from that: New companies can't raise the money they need to really get going, so they flounder around, and more die than probably need to die," Toner says. "On the other hand, there are bigger companies that have been here -- EA has been an anchor locally -- but the next [size] level down, Rockstar, Radical, Nexon, Relic, Ubisoft Vancouver, have been rotting away pretty quickly."

The landscape of Vancouver has also been affected by the increasing shift in importance for the mobile and social spaces, a trend that's also seen mid-tier console games vacated. "These mid-size companies have been bought by U.S. companies, or other international companies, and what happens is you become a branch plant as opposed to being your own little shop... When you're being managed by a U.S. or a Japanese company, your fate is decided by a spreadsheet."

Meanwhile, more attractive tax schemes are making Montreal a lot more attractive for companies wanting to do business in Canada, with Toronto learning from its example and following suit. "[Ontario] gave Rockstar a sweetheart deal," says Toner of Rockstar's expansion in Toronto at the expense of the Vancouver facility.

Even the film and television arenas are starting to be outbid by other places eastward, says Toner. Vancouver's crediting scheme is under enormous pressure, he says -- it's only half of what's available elsewhere, but at the same time it's significant enough that the government wants to closely control where the money's going.

Toner also says the tax scheme is "queerly worded," and the net effect of all that is that small companies have a hard time actually accessing the money meant to be laid aside to help new interactive entertainment businesses break ground. If more resources were allocated to small businesses it'd be a good start in helping pull Vancouver back from the brink.


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Comments


Rafael Vazquez
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I'm moving up to Vancouver to study a master's degree but in all honesty, all these rumors and bad news really make me nervous about having a career there :S

I really hope we manage to turn things around soon.

Peter Saumur
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First thing you find out is just how expensive it is to live there. Sure, it's relative to where you are coming from, but not that long ago it wasn't near the cost-of-living it is now. Almost on par with California and some European cities.

Mathieu MarquisBolduc
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No kidding. Even with a professionnal salary, I was down to renting a half-basement in the subburbs. But the air is very pure, the scenery very beautiful, and the sushi very inexpensive.

Peter Saumur
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Really hoping to read comments from local industry people from there. I moved away from there in 2003 and have no idea what the local industry looks like now; except for a ton of new animation/VFX studios opening shop there in the last 2-3 years.

Dave Malmberg
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Local Vancouver dev here. Things are much more Social/Mobile based than a few years ago. I know there are some numbers somewhere that point to a large growth in startups and independent studios (read it recently), I'm in one now. It's just not gaming that is seeing this increase in startups, it's right across the tech sector here.

I also worked in the film industry for 10 years and it's very similar there. It's a cyclical system where the productions go where the best tax incentives are which seem to rotate between East (Toronto) and West (Vancouver) about every 7 years. It seems to take governments that long to come up with competing policies/tax breaks to bring back the productions.

Another potential issue is our dollar which is at or near par making it much more costly to do business here. Combine that with the tax breaks that are currently available out east and we see a migration of sorts. I do like the approach that Toner is taking as I don't think many politicians grasp just how much money this industry (gaming) generates and how much it means to the local economy.

I just want to add that I survived 2 layoffs only to be claimed by a third and I was lucky to find work fairly quickly but you have to be ready to adjust and accept that things change. It might not be exactly where you want to be but you just have to make sure you're always learning/growing. It's the only way to stay competitive.

Paul Teall
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Yikes. It's amazing how quickly this has happened. I know a few people who were working at Capcom and Relic, and they've left the city. Crazy, I used to consider Vancouver as one of the top 4 or 5 cities for game dev.

"Now, there are maybe 20 studios that can meet payroll consistently."

That seems a bit low. We've got 36 studios listed here: http://gamejobhunter.com/blog/local-video-game-companies-vancouve
r/. Granted, some of these are very small indie studios.

Jon Chew
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I'm from Vancouver. Page 3 paints a more representative picture of the city's gaming scene and where it's heading. Some of the largest mobile/social gaming studios/publishers like GREE and DeNA are moving in but no one seems to cover it or really care. There are 2-3 large studios closing down or moving shop but there are plenty of new guys, small and big, already moving in.

This isn't a sign that Vancouver's gaming scene is dying. It's a sign that the console-side of the industry isn't doing well (except for maybe EA Sports). There's plenty of growth that is being overlooked.

My suggestion is that if you're expecting Vancouver to be a hub of amazing AAA studios and crazy intense 3D 4D graphics, then you won't find it. But you'll find lean, start up innovation with a scrappy, get stuff done attitude and culture. We recently saw a renaissance of 2D platformers over the last few years. It's just an evolution of games, the people who play games, where games are being players and how they're being players. There's just less fish for the big sharks to eat.

Dan Lupton
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Good article, Leigh.

Without sounding too controversial, I would like to point out that this has been happening in slow motion for a number of years in Vancouver. I lived there for 5 years, and last year I had to move away because there's so much competition for the few jobs that are posted. The talent pool far exceeds the number of available jobs.

I have little faith in government intervention. The problems far exceed the solutions that government is able to provide. Risk/Reward is skewed towards more risk, less reward. AAA Game ideas and titles have been knockoff copies for far too long. The AAA game market is stagnant. Big studios need big numbers to stay afloat, so they ripoff another GTA or MW3 to fill the gap in their spreadsheet, because it's considered "safe". We need new ideas, and new business models. The indies are currently trailblazing these new avenues.

It is also my contention that the new leaders of the game industry will be gamers themselves who don't only look at next quarter's projections to determine success, but rather view success as a journey to fulfill the needs/wants of the gaming market. Right now those needs/wants aren't being met by a large portion of AAA game developers. We are being force-fed games that we already played back in 2004. This is not something that the government can fix. So please don't look to have this problem fixed by our parental figures in office, because they are not omnipotent. I view them as incompetent.

I'm not hating on anyone or any game, or studio. I hope I haven't upset anyone out there. I really liked working in Vancouver. But it's AAA heyday is long over. In the long term I do have an optimistic outlook. We're just going thru a rough patch that will probably last another 10 years. NBD.

Justin Nearing
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I have been in the Vancouver game industry since the start the of global recession, seeing the first crippling hits to EA and how the local industry has grown and adapted in light of new challenges and evolving platforms. Given this perspective, I believe that Vancouver is undeniably the brightest star in the game development industry- just not for AAA traditional console titles.

You don't need to look far to find real signs of optimism and growth in Vancouver, and this article did point out some- the indie scene has absolutely exploded with talented people able to make successful games with one/two person teams. The social/mobile scene (http://www.meetup.com/Vancouver-Social-Games/) has also exploded in the past year, going from non-existent to packed meetings of some of the most talent individuals you can meet.

And it's not just the community that has come together, studios in Vancouver are leading the way in independent social/mobile/free-to-play platforms. Look at Eastside Games (http://eastsidegamestudio.com) or A Thinking Ape (http://www.athinkingape.com/) to see hard evidence of industry leaders. Additionally, traditional AAA studios are making the jump and finding real growth and success in these emerging platforms- just look at Hothead games (http://www.hotheadgames.com/games/new/). By the way, all these studios are hiring like no tomorrow.

Vancouver's game development scene isn't dying, it's evolving. The talented individuals that have made their lives in this beautiful city are not just going to move to Montreal because of some tax incentives, they are actively building products and technology that are defining the future of our industry as a whole. That's why we need more capital like GrowLabs (http://www.growlab.ca/)- we need more risk takers who see the real opportunity afforded here.

Forget the doom and gloom, something big is happening in Vancouver, and I couldn't be more optimistic.

Albert Meranda
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Interesting article, and great comments. Thanks for this!

Munly Leong
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I left for Toronto 2-3 years ago but the tax breaks were just a nice to have. The key things that drove me away from Vancouver especially trying to do the indie startup thing were

- Vancouverites in general have a hostile culture against anything that isn't "outdoors and active", the city may look beautiful but the whole yoga/organic and active thing clashes with real gamers
- Cost of living and inability to buy a house + lack of office space to expand. Even with success you'd be putting down roots in a city that places all companies at unnecessary financial risk
- The women - I'm sure many of you guys know all about it and the general social dysfunctional vibe of the city. I can *definitely* report that things are more normal elsewhere, and at the very least you won't be seeing yoga pants everywhere.

Things Toronto has going for it:
- Real grassroots love of gaming. There are mom and pop shops everywhere, big and avid gamer populace and local events.
- An indie dev scene that is really kicking ass in terms of ideas and projects. Within my first month I thought if anything, this is the city that deserves the game industry not Vancouver.
- At an executive level in film/tv they are highly receptive to "New Media" or "Transmedia" and it's a world of difference if you are more than just hollywood tie-in or licensed projects.
- A LOT more bachelor housing available (if you want to get away from long Vancouver waitlists), which is why I came out here to avoid being distracted by other people's lives. This comes with it's own problems though (See below)

Toronto is not without its negatives. Here are some MAJOR gotchas if you plan to relocate here:
- VERY poor broadband. Teksavvy/Acanac/Distributel are you lifesavers but NOT commonly available and can take up to a month to get set up. DSL speeds can be less than 1kb (not joking) in some parts of the city. IF you can get it at all. Things were so bad here that it inspired me to found a non profit to eventually map the state of broadband around the world http://www.worldbroadbandfoundation.org
- A *NIGHTMARE* to rent for anyone who is legitimately working from home (even in a job capacity) or doing a startup. Vancouver has a lot of self employed web designer types so most people understand it, in Ontario they don't and the immigrant populace are generally from countries or cultures where they have no idea this can be done and you will be viewed with suspicion.

Do not move here without being able to get into an apartment for at least a one year lease. Get a "job" at Staples quickly that you can leave just as easily if you have to if it helps grease the wheels.You may even have to pay the whole thing up front but ultimately it's better to not lose a LOT of dev time like I have. While it's fairly easy to rent from a private owner or roomshare it in Vancouver, in Toronto some of these people are willing to miss one or two months rent waiting for their "perfect tenant" to arrive. Be prepared to spend at *least* $1k in rent (or just get into a condo) to avoid trawling the rental gutters.

Nathan Zufelt
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Munly Leong, did you seriously just list "The women" as a reason to not live/work in the games industry in Vancouver?

Munly Leong
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In reply to Nathan. YES.

This is still an industry of mostly crewed by young guys and the *right* environnment would not just encourage great game development but encourage them to put down roots. That's also how you develop and retain seniority.

Attitudes like yours is exactly why the industry struggles to attract women, much less create stuff that can appeal to them

Bryan OHara
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I moved to Vancouver after graduating last year. I had set my eye on the city a few years previous and decided to use some money I had saved to take a serious shot at establishing a career there. I knew the odds were pretty low, and being an american on an open work visa only made things more difficult.

The city itself is amazing and the extra rent costs are, from my perspective, completely understandable. After a few months of reaching out to my network, I landed a small job in a very, very small mobile games studio. Unfortunately after only 4 months working there the studio, which had been in Vancouver for 13 years, had to pick up and leave. Operating costs were simply becoming too much.

I spent the rest of my year-long visa continuing my search, but my experience reflects exactly what the article states: tons of talent and very few jobs. Soon enough, an offer came from Montreal that I knew was much better than anything I would find in the Vancouver area, so I had to pack it up and call it quits.

I do hope Vancouver continues to adjust and eventually expands again because I plan on returning at some point. Whether to earn a masters or continue my career, who knows?

Kevin Oke
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Vancouver's industry history is actually working against it in this case. Big, entrenched studios with lots of overhead and unfamiliarity with mobile/social now finding themselves swimming against the tide. The shift is happening now, but there is some unfortunate bloodletting going on. It will take awhile, but things will improve. Better tax breaks are a must though.

Jared Shaw
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The long term consequences that are being overlooked..

As someone from Vancouver I can speak directly to this article and a serious long term problem that is being overlooked at this point. When the big studios blow apart a few indie studios and 2-3 man shops are created. Everyone hails that and you find comments like @Jon Chew above (btw DeNA has less than 10 people in their office and most dev is done in Pakistan).

What you don't realize is these indie studios aren't taking on many juniors and new comers to the industry are left high and dry. While a company the size of EA or Radical could take on new grads and spend the time training and developing them because they have the cash, time and people to do it these new indie studios for the most part cannot. The current Lean Startup ethos does nothing to address business's role as providers of mentors and training to our new batch of up and comers either.

If you are a startup bootstrapping it you don't have the money or time to train someone. As a recruiter for the past 8 years the best people I've ever worked with owe a huge part of their success to a mentor or company that took the time to develop them.

The Mid/Sr. level talent crunch we see for developers is in effect only going to get worse if we continue on this path.

David Phan
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Well said Jared. That was one of the big things on my mind when I read this article. The launchpads for learning and growing in this industry are pretty much slim-pickins for the next generation of local developers.

As a bootstrapped start-up, we took in 2 very junior engineers for a few months to help us out. Partly because we wanted to help these guys learn the ropes and mostly because we didn't have the resources to attract experienced engineers. They were big contributors to our game and aside from paltry pay, we did our best to educate them in coding to Agile Scrum development so they walked away with some very solid experience under their belts.

DP

Jared Shaw
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Nicely done, we need more people in business who understand that giving back to the community you work in is essential for it's long term success.

Beyond Good and Evil
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I love how no one ever talks about the GROSS mismanagement that is EPIDEMIC in Vancouver. Studios fail for many reasons, some beyond their control - but overwhelmingly, in my own lived, direct experience, it's because of the people in control and the people running the projects.

You can't just step into real businesses with this "gamer" attitude and think it's going to work in a stable, repeatable fashion. You need experience, maturity, education and real support - not just rebel spirit.

Vancouver is in big trouble, end of story (oh yeah - and the cost of living is ridiculous and the weather sucks and the provincial government is out to lunch).

Don't worry though - things are REALLY looking up.

I'll pass. Every. Single. Time.


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