Develop sits down with the region's leading lights to discuss how the area is facing new challenges

Midlands focus: Centre of Excellence?

Develop: A continual concern for the entire industry – and the theme for Birmingham’s recent Launch conference – is the transistion to digital. How well positioned are the Midlands area studios and service providers in this regard?

Philip Oliver, Blitz Games Studios: I think what Birmingham is doing with this Launch event and incubation centre is actually fantastic for start-ups.

When you are a start-up you can now have creative and technological people create games, and they know how to create games. Although when it actually comes to running a business we’re kind of the worst people as gamers.

I know because I didn’t do well originally. But I think creating an environment like this and a network of people, supply chains and business leads is fantastic, so I think this particular centre is very good in helping with that transition.

The Midlands games industry is home to some of the UK’s most well established studios. Does that strength in the traditional sector mean the challenge of digital is especially tough here?

Maybe so, but I think for all kinds of companies it’s a common challenge. What I’m encouraged by is how many new start-ups there are here, and we’ll see in two or three years time how many survive and how many will thrive, but its really encouraging. There’s a lot of entrepreneurial spirit around.

Matthew Hidderley, Birmingham Science Park: That’s right. And I think we just need to encourage that more. There really are some fantastic studios in the Midlands.

If we can all use our resources a lot better and accept that, actually, if we do support these small start-up indie studios then we as an industry will be far better off going forward.

So maybe some formal program where we get a lot more industry mentors to get involved with not only this incubation program in the Science Park, but wider afield as well could be done. And that can be done remotely through tele-presence or through physical presence and conferences as well.

Oliver: With any start-up there is a mortality rate and there is no getting round that. I always used to tell everybody just don’t do it, don’t start your own business, because the mortality rate is quite high.

Everybody is quite optimistic and thinks it’ll work out, but you only need one thing wrong to pull you down. You can get nine right; but get one thing wrong and you’re out.

But I have changed slightly with digital distribution because the barrier for entry, and the amount you need to invest before you come to market has been reduced so considerably that it’s now an affordable risk.

But what I would actually say is make sure it is an affordable risk; don’t mortgage yourself so ridiculously that if anything doesn’t work that you are screwed.

Trevor Williams, Playground Games: I was talking to Oli – the CEO of NeonPlay – yesterday about how they kept going and how you can generate revenue quite quickly.

He had no seat capital. It was a risk because they did it on their own money, but they were able to release a game, and because the game was successful, they were able to generate revenue quickly.

Whereas the big console business is quite different, you have to generate a lot of cash up front before you get it in return.

Speaking to the CEO of the Birmingham Science Park, David Hardman, it seemed apparent that finding investors that are specifically interested in investing in technology companies, and funding in this area in general, has been hard, even in contrast to the rest of the country.

Williams: We’ve always found it hard. I’ve founded three start-ups and we’ve always done it with our own money. We’ve tried hard to get other money; we’ve just never been successful.

Hidderley: We find that with the old fashioned traditional engineering companies, the investors are a lot more open; they know the business models.

But we find that investors generally just do not understand games and technology businesses as much. We’re churning out a lot of entrepreneurs and good ideas but they just do not understand games.

Jamie MacDonald, Codemasters: I think that’s fair, but I think that’s common to the UK generally. We all have friends on the west coast of the US, and it seems as long as you have some decent ideas and a decent business model you can get the funding. Even in other parts of Europe it’s easier.

Hidderley: We’ve got an Oxygen accelerator program. They’ve been with us for 13 weeks and we’ve pumped £20,000 into each business, and then we’re trying to get investors in to come and see those people and their response is very difficult.

We’re doing an investment day in London, Birmingham and Manchester, but they just don’t seem to understand technology as much.

Williams: I think some of them have also been burned as well; so some of the guys who liked the sector just don’t want to come back again.

Iain Harrison, GamerCamp: I think it leads into the Government not giving any help to the industry in this country.

I’ve got a friend in Scotland who was at Realtime Worlds when it shut and he’s done a start-up. He was telling me the amount of help he’s got off the Scottish Government is phenomenal. They’re paying £10,000 towards the wages of every member of staff he takes on.

MacDonald: It’s an interesting one isn’t it? Over the years I’ve had quite a lot of involvement with government. But you know, it’s a dead hand.

Oliver: We got very close with the cultural cash credits. We eventually got the R&D tax credits being applied to video games, which was very good, and then we got better terms and squeezed more out of it over the years.

So I actually do think we got somewhere, but its nothing compared moneywise to £10,000 per employee.

Pete O’Donnell, Freestyle: We’ve all been in games so long, and if you went round this table and asked, in three years time where should we put our resources? What game should we make? No one would know.

So if I’m a venture capitalist guy, and someone asks me for £50,000-to-£1 million, it’s like ‘I don’t know’ and I live and breathe computer games.

It’s so hard for them because they just haven’t got the level of expertise and level of knowledge that we’ve got, and we don’t even know.

The thing we don’t want to be like is the UK film industry. They have got used to the idea of huge public subsidy, and to what effect?

I saw a stat the other day where around a hundred films made by the UK film industry last year weren’t released theatrically. You think, why is it put there? Basically it’s a big job creation scheme for that industry.

Why do we put up with it? I guess its because MPs like to go to film premieres and hang about that crowd.

Rich Eddy, Codemasters: And gaming still isn’t referenced as a cultural item. Music, films and books are all cultural items; that’s why anyone can go and plug any TV show, and music as well, which is still a commercial product, and that’s why they can promote on the BBC.

Games are just a basic commercial white goods product you cannot be seen to be promoting.

Oliver: The cultural tax breaks, they obviously got approved for about a week before the new Government came in, and then got taken away.

But they weren’t saying it wasn’t cultural, but saying we need to save some money. Which is a bit short sighted because I think it would have made them more money in the long run.

Part of that was because somebody – a big known publisher which I’m not going to name here – didn’t want games to be culturally classified, and went in at the highest levels of government to have that undone.

As for the skills and the talent available in the Midlands, do you feel particularly well supported? Or is it the same everywhere?

It’s the same as everywhere in the UK. I know that there is the Livingstone-Hope report, and their number one thing is to get programming back into the national curriculum and I so want that to happen because I do think that is the biggest problem of our industry.

And in fact its not just our industry. It’s going to affect the whole bloody country because everybody needs people to be able to work on computers, and not just work on them, but work under the hood as well.

We’re just going to end up not being able to because we’ve lost it for 15 years and now we can’t even hire the teachers to teach it.

Everything’s just broken down so badly now that it’s going to take a hell of a lot to put it back again. There’s a shortage of supply in the UK in general of programmers.

I think when it comes to universities, they’re keen and they want to because they know they’ve got the courses, but they just can’t get the students in and filter out the good ones.

People have applied because it’s a games course but they can’t show their talent. There’s no tools for them to, and no starting point.

In some ways the Midlands is actually quite good because you can actually pretty much recruit from anywhere in the country.

I would imagine there are certain parts in the country with extremities that are going to find their catchment area smaller. But the Midlands catchment area is pretty much the whole country.

MacDonald: GamerCamp is a great idea because of the fact that it’s post-graduate only and it teaches some real skills to be used in the industry.

It has been a scandal really the amount of money that’s been wasted on undergraduate courses on kids that will never get a job in the industry.

In the console world – maybe I’m old fashioned – I like people to have really good first degrees from good universities in computer science, then they can do a gaming course.

Let’s not forget that we are competing in a global industry so we have to compete with the best in the world. We can’t do that with people who are not up to it.

Oliver: I was at a talk that Frontier’s David Braben gave and he was saying that he recommends everybody who wants to get into game programming go into a computer science course because you’ll get enough skills and be respected by the games industry. But more than that, you’ll be respected by every other industry.

The problem is if you go on a games programming course, if you get into the games industry well done, but actually your odds probably aren’t that good, and if you don’t, you’re screwed. It’s worth nothing, which is a problem.

MacDonald: But just as a counterpoint, because I know that David and Phillip were talking about this before, let’s not forget that there are other much needed skills in the games industry.

Oliver: Yes, there are, but what I was going to say was that programming is always the bottleneck. It always has been at Blitz and I think it probably is at most these places.

When it comes to the artists, we need very good artists, we hunt for good artists, but there are enough coming through that it’s not the thing that holds your business back. On the programming front, it holds your business back.

MacDonald: I take your point, but I’d also say over the last ten years the biggest skill problem is in the design discipline just because there wasn’t anywhere you could actually train to be a game designer.

Are there other industry challenges the Midlands needs to focus on?

Oliver: One contentious issue is that lots of the microstudios have come about because they lost their jobs at the big studios and can’t get back in and therefore are just doing this whilst they’re looking.

Williams: I half agree with that. I think that the fact that someone lost their job gave them the opportunity to do that. I think some people choose to do it rather than go back into a big studio.

So there’s a feeling that microstudios have perhaps been romanticised, and may be a symptom of another problem rather than a glorious paradigm shift?

Oliver: There was some minister talking about it up in Dundee or Manchester who was like ‘wow this is brilliant, there’s all these companies.’

But the main reason all these companies are here is because the big employers have gone down. When you look at how many now have jobs now versus how many did have jobs, it’s horrendous.

MacDonald: But it’s a good thing. I’d rather that than they all go to Montréal.

O’Donnell: The thing for me about digital development studios and start-ups is there is not enough information being pushed about digital publishing. This is my big problem.

The guy from Google said you can publish your game in five minutes. His point is that you can upload your apps easily, but that doesn’t mean anyone’s going to buy it.

All these start-ups can make these great games but it’s so difficult to get out there.

Alex McLean, Codemasters: If I was a business partner for a start-up and I didn’t see a significant allocation of spend against marketing or something like that, I wouldn’t consider their effort credible.

I would just ask the question: ‘How will you succeed without that allocation of spend?’

O’Donnell: I think it’s such an important part, even for GamerCamp as well. We can get all these guys that want to start their own studio and that’s fine.

But we need such a big part of it to be business and how you’re going to sell, turnover, when its going to come in, the cash flow etcetera, and hopefully that side of it is being covered as well.

MacDonald: One does have to accept that publishers do do something.

A Rare view

Develop asks Rare’s senior studio director Craig Duncan how he feels about the Midlands industry and how developers can face the challenges ahead.

Is it a good thing so many microstudios are setting up in the region, or is this a symptom of problems such as the fall of big studios?

Ultimately more studios of any shape and size is great for the industry. It’s all about economics; a larger studio has the potential and bandwidth to create an experience that can change the landscape, appealing to a larger business opportunity and audience, but that opportunity requires more investment.

A microstudio usually targets smaller experiences or parts of projects that it is hopeful it can get the funding, traction or opportunity to cover a smaller business cost.

There will always be a need for all sizes and spectrums of games, and more competition will drive higher quality that is fundamentally driven by the talent and expertise within studios, so it’s a good thing.

Should young devs be taught more about business and publishing side?

Absolutely. Making a game is only half the story, and greater appreciation of business opportunity and publishing execution will help developers of any level to understand where opportunity lies for them.

Business and publishing are both hugely specialised and varied subjects that need real expertise and focus in any studio.

Has being situated in the Midlands contributed to Rare’s success?
Being a first-party Microsoft studio, we look at ourselves as a part of a global company as well as a Midlands company, but here is great in terms of connectivity for UK and worldwide travel.

The new generation speaks out

Distorted Poetry

Formed in February 2011 by James Booth and Steve Parkes, Distorted Poetry develops games for handheld and mobile devices, recently releasing Petri-Dash on the App Store.

Booth says there isn’t enough financial support for developers in the Midlands as it stands, after Screen WM closed down and Creative England waits to start its funding schemes.

He states, however, there has been great support from Birmingham City University and GamerCamp, the latter of which has trained up four members of the small studio’s team.

He adds that one recent improvement in the area is the number of business incubation programs that have started.

Distorted Poety itself was formed through one of these programs, called e4f, at the Birmingham Science Park, which provides free office space as well as help and advice on business development.

“Something like that is perfect for a start-up, especially when, like us, you don’t have a background in business,” he says.

Soshi Games

Social music games studio Soshi Games is a small team of 12 currently working on Music Festivals, a city building style game which features more than 15 million songs and asks players to sign and book real bands to perform in their virtual world.

Countering Booth’s assertion of the lack of financial support, Soshi CEO Kevin Corti believes the Midlands offers good backing and it is improving all the time.

“There are some funding opportunities if you have a strong business case. We just secured £200,000 seed funding through Midven, a regional seed fund, for example,” he says.

He is also keen to highlight that there is an abundance of office space available for new creative and tech companies, highlighting the Birmingham Science Park that has supported the studio with cheap rent, equipment and tech services.

He adds that the Midlands is also a great place to be for hiring new computer science graduates, but conceded that it’s tough finding experienced staff.

Fish in a bottle

Browser and mobile developer Fish in a Bottle has worked on titles such as a digital version of Activision’s DJ Hero 2, and the World War II web game 303 Squadron for Channel 4.

Founder Justin Eames reveals that the ambitious studio has just invested “a six figure sum” of their own money into IP generation, having developed for other companies’ brands in the past.

He says that the Leamington Spa area is a hot spot for games development, with lots of support between companies. But adds that unfortunately it is not known for that outside of the core console games industry which made the hub famous.

“Anyone who looks at the Midlands games scene and thinks it’s too mature for support, or hasn’t any further potential, is making the mistake of several lifetimes,” insists Eames.

He also claims that rather than rely heavily on institutional backing, young businesses need support through mentoring, opportunity and knowledge sharing.

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