Making it in SA’s gaming development industry | Fin24
 
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Making it in SA’s gaming development industry

Oct 15 2019 17:37
Timothy Rangongo
gaming

Triple-A games (AAA) are games that were developed with a significantly large budget. They are typically produced and distributed by mid-sized or major publishers, with above average development.

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One of the biggest and most pressing questions in the room at the second instalment of the Business of Gaming Forum, which takes place during the annual Comic Con Africa, was pinning down just how much revenue the local gaming industry is generating – and how much was being made from eSports, or competitive video gaming.

There is no denying that the gaming industry, and eSports in particular, has mushroomed over the years. According to PwC’s latest entertainment and media outlook, SA’s video games market is on a strong growth trajectory, generating total revenue of more than R3bn in 2017, and is projected to grow at a compound annual growth rate of 15% to reach R6.2bn by 2022.

“I think that the real money lies not in the playing of the games, but the making of the games,” says Nicholas Hall, CEO of Interactive Entertainment SA, a non-profit organisation and lobby group that has been involved in several task teams to, for example, have skills related to gaming and game development added to the scarce skills list.

“The game development industry was valued at $137bn across the globe in 2018, which is larger than the music and film industries combined. SA game developers, by comparison, made about R150m in 2018, representing 75% year-on-year growth, which is nothing when you convert it into dollars, but we are the largest in Africa, which is something,” he says.

Local game development successes

There are about 224 developers in the local games industry, says Hall. He adds that one needs to factor in the services industry i.e. companies that are involved in programming or animation work for AAA offshore companies that make gaming titles such as Dota or League of Legends (a lot of the in-game effects were created in SA).

Most SA-based studios make games for entertainment, which is where the money is, says Hall. “Games for entertainment are the most popular form of development. It’s high-risk, but if you get it right, they have a huge return on investment. It is an industry thatis very much like music and film, in that it is hit-driven. If you could be one of those hits, you are going to make a lot of money.”

This has been successfully done in SA, with locally developed hit game titles like Viscera Cleanup Detail, Stasis, Broforce and Semblance. Semblance was developed by Nyamakop in 2018 and has now become the first title developed in Africa for the Nintendo Switch platform.

“SA does have the ingredients and foundations to have something monumental grow here. One of the biggest things for the services industry, which is going to be a key part of our growth as an industry, is that we have excellent value for money. We’re not necessarily the cheapest, as you can still get the work we do done inIndia or Vietnam for less money, but it won’t be as good,” says Hall.

“We are also on the right time zone and we speak with fairly neutral English accents, which makes working with Europe very easy, for example. You spend in rands but get paid in dollars, so the cost of living is lessened.”

Regulation hurdles

Hall says it’s easier to set up a game development studio in London, or even elsewhere in Africa, than in SA. This is because it is easier to register a company there. You also won’t have to worry about IP exchange control and issues with visas. However, he does admit that the government is working with the game development industry on regulatory hurdles, a lot of which are outdated and the result of a misunderstanding of what the industry can actually hold.

Mario Rizzo, founder and CEO of Quebec-basedArtisan Studios, is on a mission to develop the first AAA game in Africa for export to the US and Europe. He says SA could take a leaf from Canada’s book on how to disentangle regulatory hurdles.

In 1997, Ubisoft made a deal with the government of Quebec in Montreal to open one AAA studio. Several other major studios followed suit, transforming the city into a commercial and creative hub.

The city’s key incentive to developers is a MultimediaTitles Tax Credit, allowing foreign multimedia companies to recover up to 40% of eligible labour expenditures.

If one spent $1m a year, at the end of the fiscal year, they’d get a cheque for $400 000 from the Canadian government. Annually. They have been doing this for 25 years. Ubisoft also lobbied for this tax credit, explains Rizzo.

Another very important factor is universities. According to Rizzo, Canada creates “academic programmes that will feed the AAA game development studios”.

“Most of the colleges in Quebec have people that work at, for example, Ubisoft or Activison, as facilitators who come in to teach.”

Games with relevance

While the local ecosystem is fairly developed, access to the international network is absolutely crucial. Hall says as soon as somebody makes it locally, gets enough money and success, they start asking “what the hell am I doing in South Africa?” They then often leave for the US or Europe.

People are hoping that it won’t be the case for Nyamakop, the developers of Semblance, published by Good Shepherd Entertainment, and released for Microsoft Windows, OS X and Nintendo Switch.

Co-founder and creative director of Nyamakop, Ben Myres, attests to the difficulties of developing a game in SA. “We started making Semblance in 2015 to break into the gaming industry. We had a lot of assumptions and internalised ideas about making games.

“Some of the assumptions were that we would build a huge fan base, get great preview coverage, get selected for awards and exhibitions, get a publisher, sit back and look at our amazing work… make tonnes of money on release.”

Most of that happened, including being the first African developed IP to ever release on Nintendo. It had a million social media impressions during launch month and the game is now highly rated.

“But we did not get rich and still haven’t recuperated. But we are not dead yet,” jokes Myres. “We are still here and working on new projects.”

The requirements for breaking into the game development industry, according to Myres, are to be ready to succeed but prepared to fail, refining your metrics of success, having a long-term vision, being visible, reputable, patient and learning.

Then there is marketability. The game design at its base level needs to be something that is desirable, says Steve Pinto, founder and director of Cali4ways, which is set to release Boet Fighter this year – a very localised and humorous fighting game that has Fourways, Johannesburg, as its setting.

Pinto says you have to spend a lot of time conceptualising your game and prototyping it. You need to make sure that the game that you are making is marketable and desired by people.

This article originally appeared in the 10 October edition of finweek magazine. Buy and download the magazine here or subscribe to our newsletter here.

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