In a new article posted on Developmag.com today, Games Investor consultant Rick Gibson examines the nature of expanding development overseas, and highlights some of the difficulties involved in doing so.
"Ubisoft’s recent move to buy and rapidly expand a Gameloft studio in India to over 200 staff by 2009 is the latest example of international expansion into lower cost markets by bold companies unafraid to exploit globalisation," he writes.
By examining Ubisoft's history of global expansion, which now encompasses 18 different territories, Gibson takes a look at the problems it faced in growing its Shanghai studio as an internal art resource and then as a game development studio - in particular the troubles it had in keeping staff from leaving.
Gibson continues: "The problem was essentially cultural, a deep-rooted lack of company loyalty primarily driven by the mentality of former state-owned enterprise employees who prioritised fast salary growth over commitment to the company training them. The result was a continuous flow of ex-Ubisoft producers, programmers, designers, marketing and sales people into local companies, whose rates as outsourced studios can today exceed San Francisco’s."
For more on Ubisoft's global expansion and the lessons it's learnt, check out the full article here.