ESG In the Press – Business in Vancouver

In the battle for gaming business, Vancouver is about to ‘git gud’


With clinchers like talent, innovation and lifestyle, Vancouver is fast climbing the leaderboard to become the video game hub of Canada. As of 2015, 27.1% of video game firms were primarily located in BC, compared to Quebec with 29.4%. But, as the Entertainment Software Industry (ESA) points out, we have the player advantage: “In BC the number of operating studios increased by roughly 91%,” suggesting BC’s industry has the momentum for breakthrough growth.

“BC continues to thrive as a global video game hub driven by the successes of large, established companies such as Electronic Arts Canada, local studios backed by global publishers such as Relic Entertainment, and fiercely independent developers such as East Side Games,” says Dave Fracchia, professor of Professional Practice at the Centre for Digital Media, and a digital media consultant.

Worldwide revenue from video games exceeded US$83 billion in 2014; it’s projected to hit $107 billion in 2017. Gaming contributed $1.6 billion to Canada’s GDP in 2015—and BC has the advantages to command large chunks of that, Fracchia maintains.

“Most important is our talent. BC’s video game workforce is comprised of highly educated and skilled developers, and its academic institutions are globally recognized for their outstanding graduates.

“Second, Vancouver is a world-class, culturally diverse, safe and beautiful city. Its culture, events, mild weather, geography, quality education and great public transportation make it a fantastic place to attract and retain talent.

“Finally, from the business perspective, geographical access to global locations and markets, BC’s tax rates and incentives, together with a competitive Canadian currency, make locating here financially attractive.” Through DigiBC, the industry’s provincial association, the Interactive Digital Media Credit of 17.5% on salaries and wages is extended to 2020. DigiBC is also working to help fulfill the objectives of the BC Tech Strategy, including teaching coding to every student by high school graduation.

All of this combines to make Vancouver and BC very attractive to domestic and international gaming studios alike, and not just for development. Studios that started here are deepening their roots here. Firms like Bandai Namco and new arrivals like Valhalla are establishing studios serving the North American market from Vancouver. And giants like Microsoft are making big commitments to their gaming franchises in Vancouver.

Not unlike a setback in a video game, the gaming industry was burgeoning until it got whacked by the 2008 recession. Electronic Arts’ Vancouver team shrank from 1,800 to 1,000, relates Jon Lutz, Vice President of Financial Planning and Strategy. Now EA is on the rebound, with 1,300 Vancouver employees out of 8,500 worldwide.

Vancouver is Electronic Arts’ global home for sports products like soccer video game FIFA, and its Burnaby campus is home to its Global Motion Capture stage—which replicates actors’ body and facial motions—for all of EA’s games produced worldwide.

Gaming, Lutz says bluntly, is a “juggernaut.” By involving the consumer, it’s compelling and challenging. It sharpens skills like math and strategizing. Gaming has already overtaken movie box office returns; it’s just a matter of time before it leaves DVDs and rentals in the dust.

And, it creates jobs. “The really cool thing about interactive entertainment is that we create high-paid permanent jobs that are extremely attractive to youth. As such, we offer a natural on-boarding for youth to get to technology. Many companies have spawned in Vancouver from people that began in EA or other video game companies and have gone on to tech with that knowledge,” says Lutz, noting that Vancouver’s average gaming salary is $80,000 compared to $40,000 as the average general salary.

Like the city itself, Vancouver’s gaming companies are a diverse, eclectic mix. Says Justin Dowdeswell, General Manager at Relic, “Whether you’re interested in building mobile games with an indie studio, Triple A strategy games with us at Relic, or emerging technologies with a scrappy startup, you can find it all right here.”

Relic, homegrown in Yaletown from 1997, is known for its genre-defining strategy games like the real-time Homeworld, and for bold, critically-acclaimed franchises like Dawn of War and Company of Heroes. As a SEGA-owned studio, Relic has “the stability of a global corporation without losing the freedom to work as an independent studio here in BC,” Dowdeswell explains.

With 150 people and expanding, Relic is “focused on growth of our talent, our portfolio and our place in the industry.” Dowdeswell’s belief in Vancouver goes beyond its business advantages. The city has “an organic resilience,” a wellness that gets you get away from work to the outdoors, building work-life balance, he says.

“We’re at an exciting time,” says East Side Games CEO Josh Nilson. “We try to make accessible games that have a little bit more of a core experience to them. We want to be the game that you’re playing when you’re supposed to be in a meeting, supposed to be working, when you’re on the bus.”

Part of East Side’s feistiness and enthusiasm—it’s home to cheeky games like Pot Farm and the soon-to-be-released Trailer Park Boys—comes from being run as a start-up. “We’re going back on the old model, which used to be get a bunch of money up front from a publisher, make a title, hope it breaks, hope it knocks it out of the park. Now we’re raising equity in our own companies, making sure we’re only spending what we bring in.” And, Nilson maintains, Vancouver is a unique place in the gaming world. “You can’t manage your Vancouver studio from remote. You have to be here and be part of the culture to be a success.”

Gaming has huge curb appeal for youth, as EA’s Lutz says. The key is not to sit on that potential, but drive it. Diverse companies like Electronic Arts, Relic Entertainment and East Side Games all reflect the passion for their industry, the uniqueness of Vancouver as a hub for innovative gaming, and the drive to make a world-class cluster right here. The future of gaming studios in British Columbia is bright—for local studios and international firms alike. This is great news for the cluster, for local young talent, and for the continued growth of a diverse, resilient regional economy.

HQ Vancouver’s Conversation Series is produced in partnership with the SFU Beedie School of Business.

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