25 Years of Ubisoft

It is when Yves Guillemot lists the companies that Ubisoft first worked with that you realise just what an achievement it has been to simply survive for 25 years, let alone prosper.

He recalls deals with Domark, Elite, US Gold, Telecomsoft and Ocean – all now either defunct, absorbed by mergers, or far from the mainstream games market.

Only two of the publishers that he mentions from those pioneering days are still front and centre in today’s industry: EA and Activision.

So, 25 years in the business is an anniversary worth noting and an achievement worth celebrating, especially as it coincides with probably the most successful period in the firm’s history – a fact acknowledged last night (April 7th) at the MCV Awards where Ubisoft scooped the Grand Prix.

After a tough period that saw the 2009/10 sales fall 18 per cent to €871m and a net loss of €44m, it has recently hit top form with the Just Dance franchise, Assassin’s Creed Brotherhood and Michael Jackson: The Experience all selling strongly.

For its FY11, which ended on March 31st, sales will go back up above a billion euros and it will return to profitability.

Guillemot, however, has his sights set even higher – on the top spot, in fact. He says: Now we are number three, and our aim one day is to beat those guys.”
Those guys being the official Big Two: EA and Activision? Yes.”

That’s quite a task… Well, we got from number 25 to number three, so we think that we can continue and that it is possible. It’s not certain, but we are taking the steps that we think will take us there.”

Guillemot speaks softly, and there’s no hint of bravado or bluster. He’s not saying it will happen, he’s not promising or threatening. He’s just saying, quietly, that Ubisoft is a true global gaming giant; that it will continue to create games that win market share and build its business; and it’s currently doing that so damn well that it is looking ambitiously up at the only two companies clearly ahead of it rather than nervously around at the half dozen or so around the same mark.

First though, that journey from 25 to three…

How was Ubisoft founded?

My parents had a company that sold products to farmers. They had a deal with their kids that they would pay for their education, but they would all then work for a couple of years at the company to help change it.

Two of my brothers, Claude and Michel, finished their studies and they started to look at opportunities that were more interesting than just buying and selling farm equipment and services.

One New Year’s Eve Michel was in the UK when he saw that the retail price in the UK was 40 per cent less than they were in France.

He thought maybe there’s a way to sell those products and make a bit of a margin in between. So he started a mail order company in France, called Guillemot International. He was buying products from US Gold, Ocean, Gremlin, companies like that, translating them and selling them in France.

Then, because his prices were very attractive, some retailers asked him to supply them.

Quickly after that we decided we should start properly representing publishers as their French distributor, and that we should start creating our own video games. That’s when we created a new company. We took the initials of all our girlfriends’ names to make the name of Ubisoft.

What was more important then, the distribution business, where you represented UK and US companies in France, or your own development and publishing business?

Initially, the distribution business was bigger, but the goal was always to finance the publishing through the distribution. We did it to have enough to pay for more investment in our own product.

All the money we made through distribution was invested in our own games and very soon after the company was formed it was fifty-fifty in terms of publishing and distribution.

And when did you make the transition from a French distributor and publisher to an international firm?

In those early years we did publish some very French-specific products, but we did a deal with Epyx in the US and Electronic Arts and they started publishing our titles.

Certain products helped us gain a more international reputation. Jimmy Connors Pro Tennis Tour was an excellent game that was a big step forward for us.
We also bought the licence to do a Game Boy version of Star Wars which got us to number one in the UK and also helped us realise how big this business really was.

Then in the mid-’90s Rayman was a real global hit that became known in all countries.

What are the significant differences between the company you founded and the company you run now – and what remains the same?

What remains the same is that we’re always a challenger. We are not the biggest, we need to find ways to win market share and be more creative and agile than our competitors.

We’ve always considered creativity, using new technology and entering new markets quickly as the way to gain share and be recognised.

What’s changed, of course, is the size. We now have 6,000 developers around the world, which is the second largest resource in the industry.

Bringing things up to date, the industry has been surprised by the success of Just Dance over the last 15 months or so. Has it surprised you?

The level of success took us by surprise, yes. The fact that it became a phenomenon took us by surprise.
When we created Raving Rabbids, the dancing mini game was always popular, first internally and then with consumers, so we knew we had to do a spin-off and launch it worldwide.

When we were building up towards the launch it was always a huge hit with our employees, particularly women, so we knew it had potential. We didn’t think it would be as big as it has become though, no.

What has been the secret to the game’s success?

The most important thing is having fun together, just dancing. You do have to perform and it does track your performance, but it doesn’t matter very much, you just have fun. It’s not about telling you whether you’re good or bad, it’s about the feeling you get from playing it.

Do you worry that it might suffer the same ‘faddish’ fate of the musical instrument games?

I put all those products in the category of ‘Family Games’ and I think it is a trend-driven category. After a while the consumer tends to feel that he ‘already has’ a game and the publisher needs to come up with new reasons for them to buy. There has to be major innovation in the content at that point or the sales will die.

So I think it will be strong for four or five years and if we manage to make it more appealing at that point then maybe it can continue to progress, but maybe it will become a different type of game.

New hardware will also come into play and give us the chance to do new things.

Another brand that has stepped up recently was Assassin’s Creed. Was Brotherhood a breakthrough product for the brand?

It was, and that is because we invested more in the product. It was a real focus for us and I think we delivered a better experience.

Will there be a new Assassin’s Creed game this year?

Yes, but we have not announced the details yet. All I can say is that it will be something interesting around the Assassin’s brand.

What other product highlights would you pick our for this year?

The return of Driver will be a highlight, definitely.

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