Magazine article Variety

French Establish Worldwide Avatars

Magazine article Variety

French Establish Worldwide Avatars

Article excerpt

PARIS

The French gaming biz may look to some like one of the world's hot spots: booming heavyweight shingle Ubisoft calls the country home, and the Gallic education system ensures a deep talent pool. But less than a third of France's 300 gaming companies generate more than euro1 million ($1.3 million) in annual revenue, and nationwide tax incentives aren't easy to access or attractive enough to compete with the likes of Canada.

Indeed the industry's profile is a bit Jekyll-and-Hyde. According the National Video Game Syndicate, the biz grossed an estimated $3.6 billion, more than the film and music industries, but this figure takes into account sales of consoles, as well as PC, software, hardware, online and mobile sales. As far as companies developing and publishing games for the global market is concerned, Gaul's gaming industry counts only a handful of large-scale independents.

The drop in physical sales of console software for the fourth consecutive year ($1.5 billion in 2012, a 16% year-toyear decline), combined with the changing consumer habits and economic recession have prompted the downfall of a dozen established vidgame outfits headquartered in France, including Mindscape, which specialized in educational titles.

"Our industry is undergoing the same challenges as the movie business: Big companies have become so riskaverse that they're increasingly focusing on producing franchise-based blockbusters with crazy budgets, and as a result, smaller companies that can't compete are often squeezed out of the market unless they try to do something totally different," says Ankama co-founder Anthony Roux.

To underscore that point, Arkane Studios, one of the last high-profile independent French developers, was bought by U.S. media group ZeniMax, which also owns Bethesda Softworks, in 2010. Arkane has developed "Arx Fatalis," "Dark Messiah of Might and Magic" and worked on "Dishonored" for Bethesda.

The country's undisputed leader is Ubisoft, the world's third-largest independent vidgame publisher. The company generates approximately half its annual revenue (an estimated $1.6 billion) from the U.S., with just 7% coming from France, according to Richard-Maxime Beaudoux, equity analyst at Natixis.

Beaudoux says Ubisoft is expected to score big this year with the launch of "Assassin's Creed IV Black Flag" and "Watch Dogs," with releases timed to the eighthgeneration of game consoles Wii U, Xbox 720 and PlayStation 4.

Many of those games, however - including such blockbuster franchises as "Assassin's Creed" and "Splinter Cell" - are being developed elsewhere, particularly in Quebec, Ubisoft's biggest operation, with 2,500 employees, as well as Eastern Europe. …

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