Activision boss says lack of Government support means high cost of living, which impacts staff happiness
Bobby Kotick, the CEO of Activision, has 'ruled out' any further expansion of the company's UK workforce, saying it is "ridiculously expensive" to live in Britain.
Speaking to The Times in a piece about the wide appeal of Guitar Hero, Kotick - whose firm employs 1,000 people already across its development, publishing, and distribution interests in Liverpool, Slough and Birmingham respectively - mentioned that a lack of Government support is holding back the games industry's growth in Britain. And he thinks wages in the country are too high.
“It is ridiculously expensive to live in the UK, especially in London,” Kotick said. “What dictates our expansion plans would be whether we can compensate our employees fairly and whether they can achieve the quality of life that they want."
Kotick said that tax incentives in the likes of Canada made for a more economically exciting location to expand.
“We think about development planning and where we can get tax incentives that would help us do that. Our employee base tends to be young, say, in their thirties. And I think that they would like to be in a city rather than in Slough.”
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Well, he's got a point - it IS stupidly expensive to live in this country. Everything - from food to property prices - is more expensive, and with the lack of support from the govenrment it's even more so for studios. The government seems hellbent on destroying the industry, instead of going to the likes of Activision - as Quebec did with Ubi - and saying "what do you need?" and then giving it.
Fran,
As much as I admire your rhetoric and wholeheartedly agree with you that Britain is an expensive place to live in, I feel that you and Games On are making a massive leap of faith in assuming that a government handout will save the games industry from whatever ills affect it.
The root of the problem of government support for creative industries is one of sustainability, how long can Canadian or the US governments sustain generous development subsidies for games companies? Although this approach has been successful for the Canadian development industry, moving it to number 3 in the list of games developing nations, does anyone expect local or national government to continue to underwrite development costs by up to 25% for the next 5 or 10 years or even longer? We are told that in the UK each developer makes a significant return for their employees and that the games industry generates significant revenues, is this really the kind of industry that requires long-term government intervention?
Given that many of the companies involved with tax breaks tend to be multinational publishers, there is some likelihood that as subsidies are removed or reduced in one region, the publishers will simply move to another region. Ironically, the UK government has some significant experience of subsidising companies to set-up activities in the poorer parts of the UK only to see them shut up shop when other parts of the world became financially more attractive.
The real issue for the UK games industry is for it to stop being compared solely on cost. Sure, it’s more expensive to make games in the UK than other parts of the world, but for that argument to be diminished, UK companies need to offer something else and it needs to be something which can’t easily be copied by developers in other countries.
I would suggest that games companies in the UK look to differentiate their products on the sales that they generate. Consider GTA4, it cost a lot of money to make by all accounts, but returned a lot more for the investment required to make it. If GTA had been created elsewhere at only 75% of the cost, would the resulting product been as good as to generate the same percentage returns?
Likewise, how many games companies in the world could produce games like Motorstorm, PGR, Star Wars Lego, Sing Star, Fable, Runescape etc.
It’s about time the games industry in the UK stopped only competing on cost as it’s a losing game, if it doesn’t it will go the same way as other UK industries: ship building, coal mining, steel production, car manufacture, motorbike manufacture etc, as companies will simply go to lower cost areas. However, if the UK games industry were to position itself as a quality manufacturer of games, where products are made that simply could not be made in other parts of the world regardless of cost that would make the same returns as those made in the UK, then the UK has a fighting chance. To pin any hopes on a long-term government bail-out of the games industry is, at best, optimistic, given the current state of the government and world economy, and at worst p*ssing in the wind.
I can see your point, really I can. Yeah, we have some top studios here: but the problem is, not everyone can be world beaters. TT, Codies, R*, Natural Motion (who do the Euphoria engine in GTA), to name but a few - but for each one of these there are more who come up with "regular" titles - won't sell millions, but will still provide employment for those in the industry and be viable businesses. And ultimately, that's what any business is about.
I guess you're right though - long term, government help can't be relied on: but at the same time, short term I think it's needed.
There's no easy solution, that's for sure.
