It’s a question I’ve been asked quite a lot recently, and in general it’s code for ‘will things ever go back to the way they were before?’
The answer is no. Game development as it was 2000-2009 is done. In the past. Those days will not return. That doesn’t mean we won’t see large studios (50-100 people) in Australia again. We most certainly will, out of a combination of growth and local success (Half Brick) and international purchase and investment (3 Blokes / Rock You).
The simple fact of the matter is that the industry has changed, and in the way of all businesses it’s gone through a period of innovation followed by a period of consolidation. Big team console development has consolidated out of Australia, and because the rapid growth part of the cycle has already happened, the circumstances aren’t right to bring it back. As long as AAA console development remains stable (and not in a period of explosive year on year growth, like mobile/social) we won’t see it return to our shores. The period where new studios could get into AAA development has passed us by.
Games industry growth is driven by market growth – and the traditional console market isn’t growing. In fact, while we’re seeing total revenues for individual titles getting bigger each year, the overall sales across the top 20 titles are down. Again, that’s a sign of consolidation. Studios grew organically during the years of growth, and then merged or were sold during the initial wave of consolidation.
So, we will see growth in areas where the market is still fragmented and yet to consolidate (mobile, social, digital download) and we won’t see growth in the areas where the market is stagnant and consolidated. Therefore, no “AAA development as we used to know it,” returning to Australia.
On the other hand, that doesn’t in any way negate future disruptions, like the next wave of consoles having an app store enabling Steam style success for indies on console platforms, resetting the market for growth again.
There are a host of opportunities locally. Focusing on whether things will every be like they used to be again blinds us to the opportunities the future holds.