on engagements. The research and data gathered to establish this report was collected by the .... Game Development. 3% L
2018 INSIGHTS on External Development for the Video Game Industry
advancing external development for the games industry
2
TABLE OF CONTENTS
04 06 07 11 14 15 16 21 22 26
WHO PARTICIPATED IN THE SURVEY QUICK STATS 2018 EXTERNAL DEVELOPMENT INDUSTRY OBSERVATIONS FINDING AND SELECTING PARTNERS/CLIENTS TOP ISSUES IN ENGAGEMENTS EXTERNAL DEVELOPMENT TOOLS AND TECH RESOURCES PROJECT DISCIPLINES AND PLATFORMS SERVICE PROVIDER AVERAGE RATES BY COUNTRY THE FUTURE OF EXTERNAL DEVELOPMENT GLOSSARY OF TERMS
ABOUT
3
What’s Inside? External development refers to the practice of video game developers / publishers (buyers) leveraging service providers (sellers) in any aspect of development including but not limited to art, animation, cinematics, audio, server-side/front-end engineering, porting, game development, UX-UI, motion capture QA, localization, and VFX. This report is intended to provide insights into the changing trends in external development that have occurred in recent years as it becomes an increasingly integral part of game development. The statistics in this report were derived from over 180 submissions from service providers and industry professionals of leading game developers / publishers worldwide. Data was anonymously contributed to provide insights on engagements. The research and data gathered to establish this report was collected by the organizers of the External Development Summit, with contributions from the XDS Advisory Committee. Permission must be requested if you would like to use this information in articles or industry presentations.
Who We Are External Development Summit (XDS) is the only annual, international games industry event held in Canada, with a primary focus on external development for Art, Animation, Audio, Engineering, QA and Localization. Each year, a broad community of game developers / publishers, service providers, and middleware providers meet in Vancouver to contribute to the advancement of the video game industry through collaboration, sharing of best practices, networking and the delivery of a high-caliber, educational program. XDS 2018 will take place on September 5-7, 2018 in Vancouver, Canada.
SPECIAL THANKS TO:
2017 Jason Harris, Senior Director, Worldwide External Development, EA
Chris Wren
Madelynne Kalyk
Kelli Brunton
Andrea Wood, Telfer School of Management Graduate
Producer, EA
XDS Marketing & Communications
Kelli Brunton, Visual Communications
2016
Chair, XDS Advisory Committee
GUEST AUTHOR
Dilber Mann, Senior Project Manager, Capcom Vancouver
CONTENT DIRECTOR
CREATIVE DIRECTOR
WHO PARTICIPATED
4
SERVICE PROVIDER OVERVIEW Service Offerings Service providers participating in the report represent a range of different disciplines.
Full SKU Game Development*
32% 19%
Art
14%
Animation Engineering
8%
Cinematics/VFX
8%
QA
5%
UX-UI
5%
Audio
5%
Localization
4%
* Results for Full SKU Game Development were divided equally between Console, Mobile, PC/Online and VR/AR
Client Make-up Service providers reported an increase in projects from Enterprise (non-games) clients. This may in part be due to industries like automotive and retail increasing their usage of gaming technologies, particularly for VR/AR applications. This resulted in an overall decrease in engagements with Multinational Games Developers/ publishers year over year. We also observed an increase in engagements with Online Social Game-Focused Developers.
Multinational Games Developer / Publisher
18%
Small Independent Console Game Developer
15%
Mobile Game-Focused Developer
14%
TV/Media Company
10%
Enterprise Clients
10%
MMO Game-Focused Developer
9%
Motion Picture Company
9%
Online Casino / Gambling
8%
Online Social Game-Focused Developer
7%
MOBA Developer
0%
64%
53%
85%
83%
of service providers surveyed have LESS THAN 50 EMPLOYEES with only 7% having more than 250 EMPLOYEES
of service providers that participated have only ONE LOCATION
of these service providers have been in business for MORE THAN 5 YEARS
of developer/ publishers expect to work with the same service providers again AFTER PROJECT COMPLETION
EMPLOYEES
9% operate out of more than 5 LOCATIONS
LOCATIONS
44% over 10 years 4% less than 2 years
TIME IN BUSINESS
RETURN CUSTOMERS
WHO PARTICIPATED
5
DEVELOPER / PUBLISHER OVERVIEW Developer / Publishers Platform Focus 38%
Console games Mobile games
19%
Multi-platform
18%
Browser/PC games VR/AR games
16% 4%
Social Casino games 3% Facebook games
Frequency of Changing Partners Year Over Year 75% of service providers are the same year over year for the majority of publishers/developers.
1%
• • 50% are the same • < 50% are the same • 100% are the same
75% are the same
5% 2% 15% 78%
5
15
86%
47%
Average team size managing service providers
Average number of service providers a developer / publisher works with annually (+1% change YoY)
Foresee a growth in demand for external development (7% decrease YoY)
Developers/publishers reported an annual spend of $6-10M or greater for external development (10% reported $26M+)
QUICK STATS
6
TOP 3
most important factors when selecting a service provider:
1
QUALITY Quality remains in the top spot YoY
2
ART
3
RATES
SKILL SET
Rates moved up into 2nd place YoY
Skill Set (formerly Experience) falls into 3rd YoY”
accounts for 75% of all external development projects
GAME INDUSTRY EVENTS are the #1 place service providers meet new clients
#1 Reason Companies Engage Service Providers: to scale teams to deliver more content & features
2018 DEVELOPMENT INDUSTRY TRENDS OBSERVATIONS 2017EXTERNAL EXTERNAL DEVELOPMENT INDUSTRY OBSERVATIONS
Mergers and Acquisitions Activity is Leading to Consolidation in the Industry M&A activity has been increasing over the past year with visible consolidation in the industry. Only 11% of SERVICE PROVIDERS reported that they are actively looking for acquisition targets (19% decrease YoY). 45% of respondents have been approached for M&A conversations (10% decrease YoY).
What services are companies interested in acquiring?
11%
SERVICE PROVIDERS Looking for M&A Targets (19% decrease YoY)
17%
3D Art
17%
VFX
15%
Animation
11%
2D
9% Cinematics 5% Audio 5% Mobile Game Development 5% Console Game Development 5% PC/Online Game Development 5% Engineering 3% AR/VR Game Development 3% Localization
45%
of service providers say they are open to being acquired (27% decrease YoY)*
*23% of respondents would not disclose
LEARN MORE To learn more about the state of M&A, check out the panel discussion “Consolidation of Service Providers”, delivered at XDS 2017.
7
2018 EXTERNAL DEVELOPMENT INDUSTRY TRENDS OBSERVATIONS
Distribution of External Development Projects Service provides reported a more even distribution of the types of companies they work with, compared to 2017 where there was an increase from mobile companies. Multinational Developers / Publishers moved to top spot, with Mobile Developers moving to third. New to the list is Small Independent Console Developers in second place.
TOP 3
areas of increase in the past 12 months
1
Multinational Developers / Publishers
2
Small Independent Console Developers
3
Mobile Developers
Service providers continue to cite Mobile developers in the top-3 client segment over the past 12 months.
The ongoing strength in projects from mobile companies is not surprising given continued growth. According to Super Data’s report, “Trends and Insights on Games and Interactive Media 2017”, the mobile market is continuing to grow with total mobile games revenue estimated at $50.3 billion USD in 2017 (15% increase YoY) and growing to a forecasted $58 billion in 2018 (16% increase YoY).1
1
www.superdataresearch.com/market-data/market-brief-year-in-review
8
2018 EXTERNAL DEVELOPMENT INDUSTRY TRENDS
9
Service Provider Art Client Portfolio by Segment, 2017 vs. 2018
2018
16%
17%
14%
31%
2017
0%
n n n n
10%
9%
17%
20%
30%
9%
9%
21%
40%
Multinational Games Developer / Publisher Small Independent Console Game Developer Mobile Game-Focused Developer MMO Game Developer
8%
50%
n n n n
60%
9%
8%
3%
70%
6%
80%
Online Social Game Developer Motion Picture Company TV/Media Company Online Casino/Gambling Company
9%
0%
5%
7%
90%
--
100%
n Enterprise Clients n MOBA Developer
Similar to the results under Client Make-up, service providers cited an increase in projects with Enterprise (non-games) clients year over year for art and engineering. There was also a noteworthy decrease in the number of Mobile games clients, possibly due fewer “big bet” mobile titles as games are becoming larger, more complex and requiring bigger budgets. Also, perhaps due to noticeable mobile development studio closures over the past 1-2 years.
Service Provider Engineering Client Portfolio by Segment, 2017 vs. 2018
2018
15%
18%
14%
26%
2017
0%
n n n n
10%
10%
29%
20%
30%
Multinational Games Developer / Publisher Mobile Game-Focused Developer Small Independent Console Game Developer TV/Media Company
8%
8%
14%
40%
50%
n n n n
60%
8%
9%
70%
Motion Picture Company Online Casino / Gambling MMO Game-Focused Developer Online Social Game-Focused Developer
7%
4%
80%
0%
13%
8%
6%
90%
n Enterprise Clients n MOBA Developer
3% - -
100%
2018 EXTERNAL DEVELOPMENT INDUSTRY TRENDS
10
VR/AR Still Not So Hot for External Development Fewer service providers remain optimistic about the impact of VR/AR, and developers / publishers continue to be less convinced this will 1 drive demand for external development. This is further supported by GDC’s recently released report “State of the Games Industry 2018” , wherein developer’s outlook indicates “faith in the long-term sustainability of the VR/AR business is slipping.”
25% SERVICE PROVIDERS see VR/AR as
the #1 driver for increased demand in external development (12% decrease YoY)
ONLY 9% of DEVELOPERS / PUBLISHERS report that they are currently experimenting with VR/AR AR (5% decrease YoY)
ONLY 1% of DEVELOPERS / PUBLISHERS believe VR/AR will drive demand 1
(9% decrease YoY)
1
reg.gdconf.com/GDC-State-of-Game-Industry-2018
FINDING AND SELECTING PARTNERS/CLIENTS
11
How do you meet the majority of your partners?
Games industry events continue to be the prevailing method for service providers to connect with developers / publishers, and vice versa. Most results remain consistent with those of last year, but with an 8% increase in developers / publishers meeting service providers by way of “external industry referrals”. The least effective method is “cold calls” from service providers.
Referrals
28% Games industry events
14%
Buyer reaches out
13%
Online research
Service Providers 35%
8%
Internal company resources
2% Other
Internal referrals & company resources
32%
Games industry events
“Being focused purely on external development, events like XDS provide a great opportunity for organic networking and for developing deeper relationships outside of production or traditional business environments.”
39%
Developers / Publishers 21%
External partner out-reach/ cold-call
Dennis Cooper, Director of External Production, Telltale Games
2%
6%
SERVICE PROVIDERS: Factors Considered When Accepting a New Client Project The following factors have remained consistent year over year. “Availability of resources to accommodate the client’s needs” comes in forth spot, showing that service providers make internal resource availability a priority before accepting new engagements.
1
Potential for future projects
2
Prestige of project/client
3
Rates the client can pay
External industry referrals
Networking sites
FINDING AND SELECTING PARTNERS/CLIENTS
12
DEVELOPERS / PUBLISHERS: Factors Considered When Selecting an External Partner
Developers / publishers indicated the most important factors in selecting an external partner are Quality and Rates, with Team Skill Sets (formerly Experience) moving down to third place. Proximity to the partner did not appear as a factor this year, which may indicate that tools and practices for remote collaboration are maturing. Security controls appear higher on the list, perhaps in part due to IBM’s report “2017 Ponemon Cost of Data Breach Study” ¹ that found “the global average cost of a data breach is $3.62M USD” – highlighting that poor security can be very costly.
1 2 3 4 5 6 7 8 9 10
QUALITY
RATES
TEAM SKILL SETS
Credibility / Reputation
Previous Clients Projects, Portfolio
Language/Communication Skills
Security Controls
Technology Experience
Studio Leadership
Size of Company
“External partners have leveled-up their studios so holistically in recent years that one of the few defining factors remaining is QUALITY. I define quality as an all-encompassing measurement of not only the execution, but the communication of work to be completed. In the true spirit of fostering an effective bi-directional partnership, BOTH sides need to over-communicate regarding their expectations of quality. This is why quality is of the utmost importance when evaluating a new or existing external partner.” Matt Regnier, Innovator, Apple
¹www.03.ibm.com/security/data-breach/
FINDING AND SELECTING PARTNERS/CLIENTS
TOP REASONS Developers / Publishers Engage Service Providers Top reasons developers / publishers indicated WHY they engage with external partners generally remained consistent year over year. The top change in 2018 is “Flexible Skill-set Ramp-up/Ramp-down” moving up one spot into second place, sending Cost Savings to third. This may be in part due to developers / publishers preferring a variable team approach during peak production periods.
25% TO BUILD MORE CONTENT AND FEATURES 22% FLEXIBLE SKILL-SET RAMP-UP/RAMP-DOWN 19% COST SAVINGS 12% ACCESS HARD-TO-FIND SKILLS/CAPABILITIES 10% LACK OF AVAILABLE LOCAL RESOURCES 6% SUPPORT CONTENT NEEDS FOR LIVE SERVICES 4% SPEED DEVELOPMENT THROUGH FOLLOW THE SUN (24X7) MODEL
#1 Reason To build more content and features
13
TOP ISSUES IN ENGAGEMENTS
14
TOP ISSUES Encountered with External Development SERVICE PROVIDERS
DEVELOPERS / PUBLISHERS
1
Shifting project schedules and delays
1
Poor quality deliverables
2
Inadequate documentation and direction
2
Iteration issues (volume, speed)
3
Differences between internal and client time estimates
3
Communication challenges
4
Communication challenges
4
Pipeline set-up
5
Legal negotiations drawn out
5
Partners lack capacity
There was much change in the list of issues encountered by service providers as compared to last year. Topping the list, and new for 2018, is “Shifting project schedules and delays”. Also new to the list is “Legal negotiations drawn out”.
There was more consistency to the priority of top issues reported by developers / publishers, however “Poor quality deliverables” moved to the top of the list from fourth place. “Partners lack capacity” moved from first to fifth spot.
INSIGHTS from the Top Floor on Common Issues XDS 2017 hosted a panel of top industry executives sharing their insights on the state of external development (view full video below). Two questions addressed the challenges that service providers commonly face.
On incomplete documentation… “Be proactive if you encounter challenges with your client partner. Feedback should be given constructively and include recommend solutions. If you see best practices from other clients, share them in order to improve the partnership.” Rod Fergusson, Studio Head, The Coalition
On major project changes… “Some changes can’t be avoided. I encourage internal teams to be as proactive as possible – warn of change and offer a mitigation plan. Do the right thing and be humane about the impact.” Mike Verdu, Senior Vice President, EA Mobile
EXTERNAL DEVELOPMENT TOOLS AND TECH RESOURCES
15
TOP TOOLS Tools commonly used to support external development displayed in order of highest usage.
SERVICE PROVIDERS
DEVELOPERS / PUBLISHERS
Jira Excel Trello Shotgun
Jira Shotgun Excel Hansoft
Communication
Skype Email Slack
Email Skype
File Transfer
Dropbox FTP Aspera Faspex Google Drive Perforce
Aspera Faspex FTP Perforce
Art Review
Shotgun Email Trello Basecamp
Shotgun Email
Code Review
Github Code Collaborator
External Company Database (CRM)
Pipedrive Salesforce Hubspot
Internal tool
Unity Unreal
Unreal Internal engine Unity
Project Management
Engines
Emerging Tools
For the third year in a row, Substance was named as the top emerging tool adopted by service providers.
Github
PROJECT DISCIPLINES AND PLATFORMS
16
The number of integrated art projects increased slightly in 2018, rising from 25% of all projects to 28%, while the percentage of conventional art projects with partial tool pipeline dropped from 36% to 33%. The number of co-development projects saw a dramatic increase from 8% to 14%. Full Development and Programming projects were not indicated in this year’s results.
TYPES OF ENGAGEMENT
33% Conventional Art External Development with partial tool pipeline
28%
25%
Integrated Art Development full pipeline
Convectional Art External Development without tool pipeline
14% Co-Development
Of all external projects, 85% are for Production, with the remainder equally distributed between R&D, Pre-production and Live Services Updates at 5% each.
PROJECTS BY PLATFORM
58%
25%
15% 2%
The number of console-based projects remained consistent at 58% YoY (50% Xbox One and PS4, 8% Xbox 360 and PS3). Browser/PC projects moved to the #2 spot seeing a 4% increase, while Mobile experienced a 7% decrease. No change in VR/AR projects at only 2%.
PROJECT DISCIPLINES AND PLATFORMS
17
External Development within Art Disciplines There was no change in the volume of photo-real projects as compared to 2017, however there has been a 6% decrease in the number of stylized projects.
27%
Stylized
PROJECT TYPES BY
ART STYLE
3%
Cartoon
63%
Photo Real
By Project Duration This chart represents average project duration, including all types of projects (art, engineering, co-development, etc.). The 2017 column combines last year’s average duration of art and engineering projects and becomes our baseline for measure moving forward. The most significant changes include a 10% increase in the number of projects lasting 9 to 12 months, and 22% decrease in the volume of projects lasting 12 months or greater.
2017 2018
55%
% of project engagements
33% 23%
10%
10%
21%
21% 13%
11%
3%
months 12
>12
PROJECT DISCIPLINES AND PLATFORMS
18
ART Disciplines Remaining Internal Similar to 2017, VFX and UI/UX remain high on the list of disciplines remaining internal. There are however niche service providers increasing their capabilities and capacities to tackle this type of work. As developers / publishers face increasing challenges to hire locally, we expect to see more VFX and UI/UX work going out of house. Cinematics has moved up to 3rd spot to remain internal. It’s possible that year over year, developers / publishers that used service providers for cinematic work were not happy with the end results (speaks to QUALITY being the overall #1 issue encountered by developers / publishers). There are also a limited number of service providers delivering high-end cinematic services – a number of whom may be challenged by lack of capacity due to work with non-games clients, like motion picture an TV. We also observed a decrease in 2D artwork remaining internal. Mobile developers / publishers may be discovering the cost-saving benefits of utilizing external partners for this type of work, in addition allowing them to focus internally on maintaining live services, analytics and building new features.
% of Companies Reporting Disciplines Remain Internal
Remains Internal
VFX 31% UI Icons
22%
Cinematics 19% 3D Animation
12%
2D Vehicles
9%
2D Weapons
9%
2D Environments
8%
2D Props
8%
2D Animation
7%
Concept Art
6%
2D Characters
4%
3D Weapons
3%
3D Characters
2%
3D Environments
0%
3D Props
0%
LEARN MORE Learn how Activision’s Alex Stein removed bottlenecks in his presentation on “Outsourcing Beyond Assets - Solving Internal Bottlenecks Externally”, delivered at XDS 2017
PROJECT DISCIPLINES AND PLATFORMS
19
ENGINEERING Disciplines Remaining Internal Although Rapid Prototyping and Engine development stayed in the top 3 disciplines developers / publishers keep internal, across the board we observed a significant DECREASE in the percentage of engineering related disciplines remaining internal. Rapid Prototyping generally remains internal as developers / publishers prefer core, creative teams to innovate and iterate efficiently, without the added challenge of external communication. Front-end Development witnessed the most noticeable drop as a discipline to remain internal. This may in part be due to this type of work being less complex, and therefore easier to define as discrete work. As a result, a greater number of service providers are offering capabilities in this area. As games continue to become larger and more complex, and local talent is harder to find, developers / publishers are looking to service providers to support engineering efforts. As a result, engineering disciplines offered by service providers are maturing and becoming more readily available.
% of Companies Reporting Disciplines Remain Internal
Remains Internal
Rapid prototyping
45%
Engine development
44%
Telemetry 38% Server-Side development
35%
Tools development
31%
Web development
30%
Full SKU console development
30%
Console game modes
26%
Full SKU mobile development
26%
Front-end development
26%
LEARN MORE As an example of a successful relationship between developer / publisher and service provider, check out “Assassin’s Creed Origins: Ubisoft & Sperasoft Co-development Engagement”, delivered at XDS 2017.
PROJECT DISCIPLINES AND PLATFORMS
20
TOP COUNTRIES Offering Different Types of Work
ANIMATION
ART*
CINEMATICS/VFX
1
China
1
China
1
United States
2
United States
2
United States
2
United Kingdom
3
Canada
3
India
3
Canada
4
India
4
Canada
4
China
5
United Kingdom
5
Ukraine
5
India
ENGINEERING
FULL SKU DEV
UX/UI
1
United States
1
United States
1
United States
2
Canada
2
United Kingdom
2
United Kingdom
3
United Kingdom
3
Canada
3
China
4
China
4
Finland
4
Canada
5
Ukraine
5
China
5
India
FINLAND & CHINA top emerging markets for game development
*Art represents a combination of sub-disciplines including 3D, 2D and concept art
SERVICE PROVIDER AVERAGE RATES BY COUNTRY
21
Service Provider Average Rates By Country Average staff month rates were collected from service providers focusing on Art and Development, with the latter representing console and mobile development primarily. The following shows countries and disciplines that received a critical mass in responses. All rates are represented in USD.
ART
DEVELOPMENT
China
$ 4,224
Canada
$ 12,210
India
$ 4,092
Finland
$ 12,551
Malaysia
$ 5,170
Spain
$ 6,820
Philippines
$ 4,290
Ukraine
$ 5,324
Russia
$ 5,544
United Kingdom $ 9,812
Spain
$ 6,490
USA
Ukraine
$ 5,742
USA
$ 10,076
Vietnam
$ 4,312
$ 14,355
USA continues to have the highest average staff month rates in Art & Development
THE FUTURE OF EXTERNAL DEVELOPMENT
22
What are the MAIN DRIVERS for an increased demand in external development services over the next 3 to 5 years? Both sides believe there will be increased demand for external development due to player’s expectations for more content. This may in part be due to HD console titles following suit with mobile in delivering more content and playability through live services (I.e. richer/deeper games). This is coupled with the release of more sophisticated hardware capable of greater storage capacities and displaying higherfidelity graphics – which also drives the need to keep development costs flat. Also note that AR/VR dropped three positions for service providers, and received low priority from developers / publishers.
SERVICE PROVIDERS
DEVELOPERS / PUBLISHERS
DEMAND FOR MORE CONTENT
1
DEMAND FOR MORE CONTENT
NEED FOR DEVELOPERS TO DECREASE DEVELOPMENT COSTS
2
NEED TO DECREASE DEVELOPMENT COSTS
COMPETITION FOR NICHE SKILLS IN CLIENT MARKETS
3
RICHER/DEEPER GAMES
VR/AR
4
COMPETITION FOR NICHE SKILLS
90% of developers/publishers responded that the need for more content is driving demand! (5% increase YoY)
THE FUTURE OF EXTERNAL DEVELOPMENT
23
WHAT DISCIPLINES are service providers optimistic about growth in demand for services over the next 12 to 18 months?
MOST OPTIMISTIC ( 10 is highest)
ENGINEERING ART ANIMATION AUDIO QA UX-U CINEMATIC/VFX LOCALIZATION 1
10
3D Artwork and Concept Art are two areas predicted to see significant growth.
86% As games get bigger/deeper and with the proliferation of platforms, 86% of developers/ publishers are seeing a growth in demand for service providers at their company (7% increase YoY)
THE FUTURE OF EXTERNAL DEVELOPMENT
In what areas have developers / publishers seen a growing demand for external services in the PAST 12 MONTHS?
24
In what areas do developers / publishers expect to see growth/demand in the NEXT 18 MONTHS?
3D CHARACTERS
1
3D CHARACTERS
3D PROPS
2
3D PROPS
ALL OTHER 3D ART
3
ALL OTHER 3D ART
VFX
4
VFX
3D ANIMATION
5
3D ANIMATION
CONCEPT ART
6
CONCEPT ART
UX-UI
7
UX-UI
ENGINEERING
8
ENGINEERING
CINEMATICS
9
CINEMATICS
TOOLS DEVELOPMENT
10
FULL SKU OR CO-DEVELOPMENT
areas of less growth The bottom three areas where developers / publishers do not expect to see much growth are: VR/AR development, 2D casual art, and 2D animation.
only 6% of developers / publishers expect to see a demand in VR/ AR development in the next 18 months (11% decrease YoY)
THE FUTURE OF EXTERNAL DEVELOPMENT THE FUTURE OF EXTERNAL DEVELOPMENT
25
Main concerns about the future of external development SERVICE PROVIDERS
DEVELOPERS / PUBLISHERS
Greater number of competitors in emerging markets are vying for projects at a lower cost, which in turn impacts profitability for established service providers
Service providers taking on more enterprise (ie. non-game) clients could reduce resource availability for traditional games clients, therefore adding risk to their projects
Lack of willingness on the part of developers / publishers to mutually support the training needs of service providers required to ramp-up on proprietary engines as learning curve is extensive
onsolidation among service providers could potentially cause C a number of issues:
• reduce competition among the top companies.
• lead to rate increases for the top companies that have been acquired
• o ne bad decision by the parent company could be detrimental to all of the entities that have been acquired
• w ork may be sub-contracted to different entities that have been acquired
ervice providers moving in to co-development and creating S their own IP means they could become future competitors to their current clients
ack of capacity can mean teams are fighting for the best talent L and bandwidth
olitical and economic instability in some countries can cause P issues working with partners
alented artists leaving credible companies to start their own T art studio, but without knowing how to run and establish a credible business
Maintaining reliable and sustainable flow of projects, with developers / publishers that may be playing wait-and-see with the market or longer term, the prospect of tools and tech that F automate the asset creation process, or make it simple for non-experts to perform, therefore moving service provider down the value chain Inability to hire local talent can hinder some service providers from accepting new business, therefore potential clients are turned away Some service providers experience an increase in demand from companies outside of the games industry. Managing these new requests with traditional games clients has become a struggle
On the importance of effective PLANNING and PRE-PRODUCTION… “Whether it’s scoping decisions, art direction choices, or game design; teams all too often enter production with many critical aspects of the game unproven. Ramping up an external partner without knowing exactly what needs to be built, or how to build it, leads to wasted work and chaotic production. It stresses both the internal and external teams, typically resulting in: inconsistent quality, redundant work, technically inefficient content, and content ‘debt’, that either has to be cleaned up later – or worse, gets propagated over multiple products. Investment in thorough preproduction, and stress testing workflows internally – ahead of external ramp-up – mitigates headaches downstream. It results in higher quality, healthier teams, and ultimately saves money!” Ricki Martin, Worlds Director, Electronic Arts
GLOSSARY OF TERMS
26
The following definitions may be subject to the context in which they were used in this report.
Co-Development Cooperative engagement where significant parts of development are shared by a client and service provider Conventional Art External Development (without tool pipeline) A service provider builds art content without any tools to integrate or export the assets to the developer Conventional Art External Development (with partial tool pipeline) A service provider builds art content with the support of tools that allow them to export content, or use a viewer to check their work Developers / Publishers (buyers) Companies that develop video games and/or publish games that they own, or publish games on behalf of other developers External Development The practice of video game developers and publishers (buyers) leveraging third party service providers (sellers) in any aspect of development Full Development A developer requires a full game to be developed by service providers
Industry Professional (buyer) An individual under the employment of a video game developer responsible for managing, influencing or decision making for external development. Integrated Art Development A developer’s full technical pipeline is used by the service provider Photo Real Art Art that is intended to simulate aspects of the real world, whether organic or inorganic, as realistically as possible Service Provider (seller) A third party external partner hired to contribute to certain or all aspects of game development Stylized Art Design according to a style or stylistic pattern rather than according to nature or tradition
EXTERNAL DEVELOPMENT SUMMIT
For more information about the External Development Summit (XDS), please contact us at:
[email protected] www.xdsummit.com
