What Gameloft’s closure means for NZ Gaming
Last week the news hit that New Zealand’s largest game studio, Gameloft, was to close with the loss of 150 jobs. That’s a significant chunk of the 600 or so game developers employed in New Zealand.
Gameloft is a French publicly-listed multinational with, at one point, over 5,000 employees and 25 studios around the world. They specialise in smartphone games, a $30 billion market globally. The local team tended to worked on casual games that appeal to a wide audience with titles such as Ice Age Adventures, My Little Pony and Country Friends.
When they originally chose to setup in New Zealand nearly six years ago it was a great endorsement of our technical and creative talent. Originally our expectations was that they would grow to become maybe a 50 or 60 person team. The fact that they grew to over 150 people shows how well the team performed and that New Zealand is indeed a great place to make games.
Industry speculation is that the closure is tied to a hostile takeover bid from French media company Vivendi. Gameloft regularly opens and closes studio around the world, and the Auckland team survived when six other studios were closed in 2015.
This is obviously sad news for the 150 people affected, although there already seem to be some silver linings.
Gameloft being here certainly benefited the New Zealand screen industry, and those benefits will stay here. Its impact is comparable to that of the first Hollywood productions coming to our shores. There is now an increased local pool of very experienced and skilled developers and artists from New Zealand and around the world. Many have already joined growing studios like Rocketwerkz or Grinding Gear Games, and the NZ Game Developers Association has launched a jobs board at nzgda.com to help candidates find jobs.
From the NZ Game Developer Association’s annual industry survey the wider NZ games industry appears to be in good health, and ultimately this reinforces what we have always known: NZ-owned original intellectual property creates more sustainable and stable studios with greater control over their own businesses and more profits retained in New Zealand.
Many Gameloft alumni are also contemplating forming “indie game” startups. While the NZGDA can support them, the lack of any development funding for interactive media in New Zealand will hold them back.
The Arcade Auckland is a new coworking space run by the Game Developers Association in Auckland, with support from ATEED and Motat. We’re making it available to startup teams for free in the medium-term while they get established and can help with investor and publisher introductions. The gap, however, is in development funds so we have investment-ready prototypes to pitch.
There has also been media coverage about Gameloft having to pay back $2.9m of a R&D Growth Grant they received from government agency Callaghan Innovation, which is appropriate in the circumstances.
The grant supported a great foreign investment win for New Zealand. It allowed Gameloft to invest in another tech team in Auckland, creating 50 or so high-tech creative ICT jobs – exactly the kind we want to diversify our economy.
But its upside is limited in comparison to the NZ Screen Production Grant (NZSPG), which currently excludes interactive media. R&D grants don’t cover creative IP development only “tech stretch”, just one part of a production and not necessarily the most valuable IP. Prototyping creative IP, new game styles or CGI visual effects are not covered. Only larger studios such as Gameloft have the scale to apply, not up’n’coming teams.
Last year we turned away another international transmedia and VFX studio wanting to setup permanently in New Zealand because they couldn’t access the Post-Production, Digital and Visual Effects (PDV) scheme which is part of the NZSPG. The scheme isn’t supporting our screen industry for a digital transmedia future.
I’m optimistic that established game studios will find places for many Gameloft alumni this year. Our industry created 130 jobs during 2014/2015, but that’s hard to replicate overnight.
The shortfall is in creative IP and development or prototyping funding (comparable with script development in the film industry). With an extra 100 or so talented screen professionals just let loose this is a huge missed opportunity for the New Zealand screen industry.