Vancouver's video game family tree

Vancouver has become a hub of the North American gaming industry thanks to a lot of teamwork and cross-pollination

Mucking around with an Apple II one summer in the early 1980s, Don Mattrick and Jeff Sember, then Vancouver high-school students, designed and programmed Evolution. Released in 1982, Evolution may have been the first home-computer game with multiple levels. It may also have been the first computer game developed in Canada. It was certainly the first created in Vancouver.

While Vancouver’s game-development industry may have had a modest start, it now includes about 75 companies that directly develop games, according to Kenton Low, president of New Media B.C. An additional 70 companies provide support services for game development, including animation and audio production. In all, approximately 3,500 people are working in the video-game industry in the Lower Mainland.

“Five years ago, that number was probably a couple of thousand,” Low told the Georgia Straight.

Vancouver’s video-game industry, which could be a central component of the future economy of the region, started, as these stories always seem to, with a couple of kids in a basement. The critical detail that’s often missing when the story of game development in the city is told, though, is the publisher of Evolution—Sydney Development Corporation. The brains behind Sydney Development, formed in 1978, belonged to Tarrnie Williams, who had spent 10 years working in Vancouver for IBM.

In a phone interview, Williams, who today manages Internet ventures including Bingo.com, said that Sydney Development was Canada’s first publicly owned software company. It was created to provide an interface for IBM’s project-management systems. Williams said the introduction of microcomputers like the Apple II opened up new sales opportunities because they were often purchased for home use, and those users were looking for a different kind of software than office users: entertainment.

“It was a great game,” Williams said of Evolution. According to Williams, he helped Mattrick and Sember create Distinctive Software Inc. so that the pair could license the rights to Sydney Development for publication. “It went very well,” Williams recalled.

The success of Evolution turned Mattrick and Sember into rich kids and instant celebrities. In 1991, DSI was acquired by California-based publisher Electronic Arts, which became one of the first companies to both develop and publish video games. The Vancouver operation became EA Canada, and the deal sparked the creation of Radical Entertainment by Ian Wilkinson and DSI’s Rory Armes. That established what would become the pattern for growth in this city: a group of talented developers who have gained experience working in a larger company decide to split off and follow their own creative vision.

At first, growth was slow. Alex Garden—who got his start in the industry as a 15-year-old tester for DSI and also worked at Radical—left EA Canada to form Relic Entertainment with Luke Moloney in 1997. In 1998, Barking Dog Studios and Black Box Games were created by ex-Radicals. Then the scene settled down for a few years, but took off again in 2002 when the larger game publishers started acquiring local independent developers. Barking Dog became Rockstar Vancouver, a division of Take-Two Interactive, and Black Box joined EA. Two years later, Relic Entertainment became part of THQ, and Radical Entertainment was acquired by Vivendi Universal (now Activision Blizzard) in 2005.

Those acquisitions led to even more proliferation. A handful of the second-generation founders of Barking Dog and Black Box have gone on to create other studios. In November 2006, a Straight cover story mentioned 11 new studios. In 2007 and 2008, a host of new studios opened, including United Front Games, Smoking Gun Interactive, Jet Black Games, PowerUp Studios, Fit Brains, and BigPark, the latter founded by Mattrick, Erik Kiss, Hanno Lemke, and Wil Mozell. Mattrick, Kiss, and Lemke were part of DSI way back when.

Game development is a high-tech industry that can work anywhere, so it takes place where people want to live, said Tarrnie Williams Jr., general manager of Relic Entertainment. He got his start in the business at the age of 10 by being the tester for Evolution, which his dad brought home for his sons to try.

“There have been many cities game development has started in,” he said on the phone from his office in downtown Vancouver. “But not that many it’s flourished in.”

UBC professor Trevor Barnes, who specializes in economic geography, is studying Vancouver’s video-game industry. The cluster that has formed here has an attractive power because of the resulting cost reductions and increasing efficiencies in production, he explained in an interview.

“There’s a kind of cumulative”¦circularity in operation that the bigger you become, the bigger you’ll get,” Barnes said. What’s unclear, he said, is whether the agglomeration of the industry in Vancouver has reached the point where it can sustain itself.

Certainly, the economic slowdown is having an impact, despite suggestions by some analysts that the video-game industry is recession-proof. In August, Radical laid off 120 people after the merger of its parent company, Vivendi, with Activision, and the subsequent cancellation of two titles. In September, California-based Foundation 9 Entertainment dumped most of the staff at its Backbone Entertainment studio in Vancouver, maintaining only a satellite operation here. Hothead Games shrank its studio work force in December when it had difficulty finding a publishing partner for its game Swarm.

Even EA has been affected by the global economic crisis. In December, it cancelled plans to open a new development studio in Yaletown and closed a downtown space, moving the EA Black Box studio—which has made the Need for Speed and Skate games—to its Burnaby campus. The company, which is the largest employer of video-game developers in Vancouver, plans to cut 10 percent of its worldwide work force by the end of March. A round of layoffs hit Black Box on January 22.

Alex Garden believes we’ll see even more activity in Vancouver’s video-game sector as a result of the economic downturn. Speaking from Humanature Studio—which he opened as a division of Nexon Publishing North America in 2006, and which Nexon subsequently closed on January 27—Garden said that historically recessions have been the reason start-ups are founded. The financial difficulties experienced by Radical Entertainment in the late ’90s, which included a stint in receivership, led to the creation of Barking Dog and Black Box.

Whenever there are layoffs, Garden said, people start new companies. Those ventures that can secure financing and develop popular games will, in turn, grow. When the next recession comes along, those companies will shrink and release some of their employees, some of whom will form new studios.

“There was a lot of money in private-equity deals done even in the fourth quarter of last year,” Garden said. “The funding is there for people who have a vision and a proven track record.”

Pedigree is perhaps the key to success for new game-development ventures. Simon Carless, publisher of Game Developer magazine and industry Web site Gamasutra, told the Straight that game publishers have been on a spending spree for the past 10 years. The acquisition of Vancouver developers Barking Dog, Black Box, Radical, and Relic was part of that trend. As a result, all major publishers have internal studios developing games. “For those companies,” Carless said, “you have to be quite special for them to do a deal for them to have the game externally produced.”

If this is true, then United Front Games is something special indeed. The developer is working on two as-yet-unannounced games for two different publishers. James Grieve, technical director at United Front and one of its 10 founding members, said the developer is working with companies that use internal studios to produce most of the games they publish. One publisher, Grieve said, told them flat out that corporate policy normally prohibited the signing of development deals with independent studios.

Grieve spoke with the Straight in the staff lounge at the United Front office, which overlooks Yaletown’s Hamilton Street. While the founders had all worked together at some point in their careers, and most had worked at Black Box, they and the company’s first hires came from the likes of Rockstar, EA, Radical, Slant Six Games, Action Pants, Propaganda Games, Blue Castle Games, and Next Level Games.

Those who established the company in 2007 had talked for years about coming together, but the actual impetus for the venture was an opportunity. “Some people were looking to have a game made,” Grieve said. “In the end, that project wasn’t right for us.” But the group members realized they could more easily capitalize on future opportunities if they joined forces. “We came together with nothing,” he said. “We came together with the people, with the knowledge that we wanted to work together, that we wanted to take everything that we’d learned from the different places we’d worked and take the best from that.”

Jared Shaw, founder and lead recruiter at 31337 Recruiters, said that he knew something was going on when his clients started losing key people overnight. “They were all going somewhere,” he said during an interview. “It was about a month later we heard about United Front Games.”

Microsoft’s Don Mattrick is a founding father of
the city’s video-game cluster.

As word of United Front spread throughout the game-development industry, people started knocking on the studio’s door. “Quicker than we could answer,” said Grieve, who added that it was flattering that so many people wanted to be part of the company. “That gave us more confidence.”

Of course, not all new ventures succeed. Among the better-known closures have been H20 Entertainment, which started in Calgary but moved to Vancouver just before closing up shop; Factory1 Games; and ModernGroove Entertainment. But it’s difficult to keep track of the failures. “How do you know that a company exists in this space?” Garden mused. “There’s probably 50 companies that have started up and failed that I’ve never even heard of before.”

“We always hear of the big successes,” said Kelly Zmak, president of Radical, on the phone from his office. Zmak said we don’t hear about the “complete and utter failures”, largely because the industry and the media are interested in what succeeds, rather than what fails.

The impulse to start something new, to storm into the industry with a strong creative vision, is one of the things that make the Vancouver development community unique within the worldwide gaming industry. “There is an entrepreneurial spirit that exists here in Vancouver that is very much a part of the way we operate our businesses,” Zmak said.

Mattrick, now a senior vice president at Microsoft, believes that the way employees can move from one company to another while staying in Vancouver has helped the industry here flourish. “If you look at the innovation and growth that comes from that cross-pollinization, that sharing of ideas, that new experience, it’s an accelerant,” he said in an interview. “We have that culture here; we got to critical mass early.”

Grieve, an Australian expat who has spent time working in the San Francisco Bay Area’s game-development industry, said that in the last 10 years many developers came to this city to work in the game industry and, when they were ready to move on, joined another Vancouver studio. “They didn’t move to the States or to the U.K.,” he said. “They stuck here. The people are coming in, they are bringing in new ideas, and they are sticking.”