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Inside Canada's Talent War

Thu 30 Jun 2011 7:00am GMT / 3:00am EDT / 12:00am PDT
PublishingDevelopment

Under the skin of a development utopia, where staff poaching happens on a weekly basis

Bedlam Games

Bedlam Games Inc. is an independent, venture capital backed developer of next generation console video...

bedlamgames.com

Behaviour

Based in Montreal, Quebec, Behaviour (formerly Artificial Mind & Movement - A2M) is Canada's largest...

bhvr.com/

Digital Extremes

Digital Extremes is a privately held company that creates and licenses the Evolution Engine, and creates...

digitalextremes.com

Nothing is rotten in the state of Canada. The skies are blue, the trees are green, the mountains are capped with snow, and, if you're in the business of making games, the tax credits flow like a babbling stream.

Over the last ten years, Canada, and Quebec in particular, has been portrayed as a sort of Shangri-la for developers: research and staff costs are just two of the numerous subsidies available to creative industries, and as long established communities like the UK crumble under the strain of rising production costs, Canada goes from strength to strength. Or so it would seem.

In the last five years Eidos, Funcom, THQ and Warner Bros. have established major studios in Montreal, with Ubisoft expanding its substantial presence in the region with a new facility in Toronto. These five companies alone have created around 2000 new jobs, most of which have yet to be filled. The competition for available talent has always been fierce, but with every new opening and expansion the lack of mid-level and senior candidates becomes more apparent and more problematic.

For James Schmalz, who founded the Ontario-based studio Digital Extremes in 1993, talented applicants haven't been so difficult to find since 2005, when the jump to the current generation of hardware caused the size of development teams to double, and in some cases triple.

Right now, very locally, it's impossible to hire people

James Schmalz, Digital Extremes

"We could not hire anybody in 2005 and 2006, because anyone who had any credentials and any talent - including people who arguably didn't have enough talent to be in the industry, but had some credentials – were getting snapped up to fill places on these massive teams... That really affected us when we were making Dark Sector. We had positions that went unfilled because we simply couldn't find the people to do the work."

The same thing is happening now. Intensified competition from Quebec and Ubisoft's arrival in Toronto has created overwhelming demand for talent, and independent studios like Digital Extremes are likely to suffer the most. "Right now, very locally, it's impossible to hire people," says Schmalz.

The same may not be true for Ubisoft, but, if the comparison with the early days of current-gen development is accurate, the general standard of acceptable applicants will be in decline, and many projects will be under-staffed. Nevertheless, Schmalz is a fervent believer in Ubisoft's potential to inspire the same growth in Ontario that it did in Montreal, even if the short-term impact is decidedly more ambiguous.

"Take a look at Montreal, take a look at Lo Angeles – you need big, anchor industries to locate here," he says. "I think I would have done it a little differently if I had masterminded it, but I congratulate them for landing that deal and bringing Ubisoft in... Right now, they've taken a few of our employees, and a few employees from every developer in Ontario, but other people will come back. There'll be a healthy exchange."

Others are less diplomatic. Every developer we talked to could see the long-term gain for Ontario, but the $263 million incentive offered to Ubisoft by the local government has been more difficult to swallow.

"Ubisoft said we're gonna hire 800 people in Ontario over the next several years, and the provincial government said, 'we will give you $263 million,'" explains Donald Henderson, general manager and COO of Toronto-based Bedlam Games. "That's a lot of money. I like to call it a quarter of a billion dollars."

For a developer like Bedlam, with only a single game release to its name, the necessity of a company the size of Ubisoft in the area is more difficult to rationalise. Quebec is fast becoming the global centre for AAA development, but Ontario has always been defined by the 90 or more independent developers that call it home. With Eidos also planning to expand its Canadian presence with another large studio in Montreal, Vancouver or Toronto, there is a growing sense that Ubisoft's arrival could damage the existing ecosystem.

"We knew that, as an independent developer, in the short run, that was going to cause some pain. They're gonna go round and ask everyone that's out of jobs, and they're still not gonna have enough people. Then they're gonna go to California and find people who want to come back to Toronto... Eventually, they're going to have to come back here and find people who are already in the industry. Like people who work for us."

According to Henderson, the problem is exacerbated by the difficulty of recruiting from other countries. Until recently, a government pilot project allowed videogame professionals with certain areas of expertise to skip the part of the process where their employer has to prove the need for those skills in Canada. But despite there being more available jobs and less quality applicants than at any time in the last six years, the government closed the program.

It's tough to work in an environment where your staff is being poached on a weekly basis

Remi Racine, Behaviour Interactive

"The short answer to that is it's very difficult," says Henderson. "It takes a long time to go through that process. Say we need a new director of production, by the time we actually get round to doing something about it we needed one last month, and when you add a year to that process, most studios just can't afford to wait that long... I see that as a real threat to us."

The implication is that, no matter how insistent THQ, Eidos, Warner Bros. and Ubisoft are that they will look outside of Canada for new staff, a significant proportion will necessarily come from within, and very likely from the workforce of competing companies. With that in mind, do Toronto's independent developers feel betrayed by the amount of money the government promised to lure Ubisoft to the area?

"I wouldn't say I feel betrayed, because the government has been very supportive. However, I will say it is frustrating when I talk to someone who is leaving the studio for Ubisoft and find out that they're getting a 30 percent pay bump. I know that's not what the market deserves, and I know that the pay bump is probably being paid by me as a tax payer as part of that $263 million... If they have a short-term problem they can solve it with money in a way that I can't."

The resolve of companies like Digital Extremes and Bedlam Games has been tested, but their response is admirably positive. The areas where they can't hope to compete with a company the size of Ubisoft are clear, so instead they are focusing on the unique benefits of working in a smaller organisation: more responsibility and creative control, a flatter structure, and, in the case of Digital Extremes, the opportunity to live in London, Ontario, where a three-bedroom house with a large garden costs around $250,000. For older developers burned out on the scale of a Ubisoft or a THQ and wanting to raise a family, it's a compelling argument.

In Montreal, the presence of top-tier publishers is nothing new. After all, Ubisoft is widely credited with kick-starting the Quebec industry when it opened its Montreal studio in 1997. But Behaviour Interactive predates Ubisoft by five years, and founder and CEO Remi Racine claims that there has been a marked change in recent times.

"When Ubisoft came in I was the only guy in the local industry thinking that it was a good thing," he says. "Having said that, when Eidos came in and after [THQ and Warner Bros.] it's more difficult than ever, because we've outgrown our pace of producing people and talent."

"As much as those companies say they are going to import people, they don't do it enough. It's tough to work in an environment where your staff is being poached on a weekly basis. I'm saying that, but I know the others feel the same way. We have a pool of talent, but that pool is not growing at the same pace as the industry. There are a lot of young people, but in the short term that doesn't improve the quality of the studios... For us to grow in Montreal is difficult."

Talent poaching within the Montreal community was given a public face last year following the departure of Ubisoft creative director Patrice Desilets for THQ. Ubisoft was awarded an injunction against THQ in January after Danny Bilson told Joystiq that the company had secured a further three people from Ubisoft at Desilets' request. Allegedly, that wasn't enough to deter THQ, and shortly after Ubisoft discovered that another former employee, Adolfo Gomez-Urda, had offered other Ubisoft staff significant pay rises to leave. A second injection was issued at the end of March.

According to Eidos Montreal general manager Stephane D'Astous there is a "critical mass" of developers in the city, and talent poaching is widely seen as a growing problem. "Definitely. To put things in perspective, Ubisoft has been in Montreal for nearly 15 years, and in that time the non-compete clause has always been there, and in that time it has been applied three times."

"The first time was when our friends at EA had the good idea to announce publicly that they had recruited five of the core team members of Splinter Cell, and they were saying [thumps chest in overtly masculine fashion]... Obviously, you are provoking at this point, and that wasn't the way we function. The second time was [former head of Ubisoft Montreal] Martin Tremblay, and that was a bad divorce that turned out sour, and thirdly with Patrice Desilets."

I hope we never go there, but a salary spiral, a salary war, might be the beginning of the end

Stephane D'Astous, Eidos Montreal

"I don't know if you noticed when Ubisoft decided to jump into that: it was when somebody from THQ, again [thumps chest] did this, and I was laughing to myself, thinking, 'Why did he say that? Why didn't he keep it low-key, under the radar?' We're at 333 [people] right now. At the start we needed to build a core team, and we had to recruit them from somewhere. But we did it the proper way. There's a proper way and a provocative way."

The Canadian government has lobbied tirelessly to attract new game companies to Quebec, and successfully encouraged local universities and educational institutions to introduce videogame production and design courses. However, it failed to anticipate the vacuum that has formed between the needs of the developers and what the city can reasonably supply. There is now a surfeit of junior candidates, and a chronic shortage of experienced staff.

"The battle in Montreal is the seniors," says D'Astous. "Everybody is scratching and fighting over the seniors. Our plan – and I think it's a logical plan – is to bring our juniors as fast as possible to mid-level seniority, and our mid-level staff as fast as possible to seniors, through masterclasses – very intense one, two, three day classes with masters from all over the world."

The managers of Montreal's various studios are uniting in pursuit of a common solution. An expert from Pixar might be invited to take low-level employees from as many as nine different studios through the company's animation pipeline. Larger developers like Eidos will foot the bill, but D'Astous seems unconcerned about his studio being the sole beneficiary. The goal, as he sees it, is "to bring the floor level higher" for everybody, and in that sense there are "more advantages to come out of it than disadvantages."

Such altruism isn't normally associated with competing companies, and we suggest that the mistrust fostered by public feuds like that between THQ and Ubisoft is surely a threat to the initiative. D'Astous politely disagrees: talent-poaching may be a reality, but the measure of each studio will be evidenced in how they respond.

"If you base your actions on exceptions you won't get much done. These things shouldn't have happened, and there was a reason why they did, but if you want to have a healthy ecosystem you need to be careful, and you need to have respect... Since we've been here three major studios have announced their arrival. I'm not immune to this, and recently other studios have been quite aggressive because they need to build their core team – I've been through it, so I understand."

"But where that applies good pressure is on the management of the studios. If you don't want to go into a salary spiral, you have to scratch your head and come up with innovative ways to keep your staff. I hope we never go there, but a salary spiral, a salary war, might be the beginning of the end."

28 Comments

Considering how many people that I know are looking for work in Vancouver at the moment, this article is kinda full of it. Then again, it also says alot about the shambles that the BC govt has turned the province into as a result of utter lack of action to support the Vancouver industry. Sure all these big companies are hiring like mad in Ontario and Quebec, but guess where they are dumping jobs like mad? Vancouver.

As of late, the layoff waves seem to have slowed, but that's primarily because the city doesn't have enough big studios left that have hundreds of people to dump at one time anymore. I'm not talking the usual project-to-project layoffs, but the same 'another 500 people let go this week' announcements that have been going on around the world for the past few years.

With so many large studios in one city downsizing or shutting down, the city is a glut of extremely talented developers with very few projects, jobs or funding opportunities to get new companies going. It's absolutely bizarre. Hence why groups like Full Indie can draw hundreds of new-found 'indie' developers to meet up's and monthly gatherings. Literally thousands of people in this city with game development experience and no work. You either 'make' yourself a job, relocate, or leave the industry.

The local industry doesn't need more tax breaks for multinational corporations, we need opportunities for smaller developers and indie's that are employing the majority of the people in this industry. Particularly with the migration to mobile, social and other platforms, this is even more the case now than it has been in the past. Massive foreign owned companies getting tax breaks to setup 'Team Bondi' style studios to churn out games isn't exactly a 'positive' thing frankly.

As a developer looking for work, you are left with relocating to the East coast as pretty much the only real option - and for those with families, ties to the area etc, this is a huge problem.

Guess my point is that it's not all roses here ;P

Posted:3 years ago

#1
The joys of tax breaks is...survival of the lowest tax break incentives?

Posted:3 years ago

#2
This will all end in tears.

There was a report a few years ago from NESTA, that looked at video games development in various jurisdictions, including Canada.

One of the things it mentioned was how local studios have found it difficult to cope with the influx of multinationals, as they snap up all the talent. Another issue - and one that's more fundamental in some respects - was the idea of the profits going overseas, and the IP belonging to foreign companies. It's all well and good saying that jobs get created, but all we're seeing right now is large multinationals having the (insert province) taxpayer by the proverbials - should the taxpayer want to stop funding the likes of Ubisoft on the basis that they're big enough to fund themselves now, then who's to say those studios won't up sticks and move to the next low cost location? Anyway, I guess I'm digressing a bit. On the talent front, all that will happen is the larger studios will outbid each other until eventually the tax breaks become a life support, rather than what they were originally meant to be - a growth measure. Wonder how long it will be until the multinationals start hinting that they might have to relocate due to staffing costs unless more taxpayer money is shoved their way.

I'll dig out that report, but it makes for really good reading - if anyone can't find it and wants a copy, email me at franmulhern@recruit3d.com.

@ Mike - that last Stanley Cup game sucked ass. I'm a big Habs fan - I REALLY didn't want Boston winning the thing;)

Posted:3 years ago

#3
It'll be interesting if it does end up in tears, because it means we really need to emulate alternative growth measures locally here in UK. From education to recruitment to R&D and retention and thus leading to long term "golden age" gaming growth now that gaming itself is mainstream

Posted:3 years ago

#4

Neil Alphonso
Lead Designer

48 17 0.4
I'm particularly interested in what happens in Ontario as it's where I grew up, but having worked in Montreal I think a key difference will be the Quebecois desire to remain in Quebec due to their native tongue and culture.

I was saying it would all end in tears 8 years ago, and I'm not so sure anymore. The thing that bothers me the most is the influx of publishers and resulting demand for senior staff has meant stagnation in regards to new start-ups... I'd really hoped we'd be seeing more in the vein of A2M, but why would anybody there take that leap given the current environment?

Posted:3 years ago

#5
Well, reading this I’m not if this is a good thing or a bad thing in regards to myself. I’m looking to get a job and relocate to Canada and I don’t particularly mind where. However recent grumblings from a few of my industry friends working over there saying how they are finding it hard to find new jobs etc halted me in my tracks. So are there jobs or aren’t there?

Posted:3 years ago

#6
I think unless you're a amazing god at your specialist skill, and are willing to relocate within canada, then there are job openings. If you are adamant at staying still, then stagnation and over abundance of talent means, slimmer pickins...

One could always work in Blighty and make something of oneself

Posted:3 years ago

#7
Some of us are aiming to get out of Blighty :)

Posted:3 years ago

#8

Neil Alphonso
Lead Designer

48 17 0.4
Montreal is the safest bet, as it's where all the pubs need to fill seats to meet the headcounts for tax incentives. If you're unhappy with your salary, bounce around a few studios there and end up back where you started 6-12 months earlier with a greatly improved payment package.
Cynical perhaps, but that's the way it's been there for years.

Posted:3 years ago

#9
@ neil - thats the unfortunate truth of it all. Still even with the current anti business regime of the UK government, there is still opportunity to be had to make business. Its just that the profits are more squeezed and the reality of being a studio of anything larger than 20 requires some heavy weight bankrolling (even with sub contracting and outsourcing of 3D, etc....)

So I guess UK is tiered into

Micro 1-2 man profitable studios (lower risk)
Small profitable studios (moderate risk + good enjoyment)

Middlemen + growing pains (high risk)

80-100 Man Old school (pre 2005) studios (moderate risk)

100 + Dinosaurs with real money to burn (increased risks)

Posted:3 years ago

#10
The UK's an awesome country - we're just very good at talking ourselves down here, and always believing the grass is greener elsewhere.

Anyway, a number of people have emailed me asking for that report - so here's the link:

[link url=http://www.nesta.org.uk/library/documents/raise-the-game-report.pdf
]http://www.nesta.org.uk/library/document...[/link]

Posted:3 years ago

#11
@ Fran - Aye. Afterall, its hard to find the right love/hate of culture, atmosphere, money, food, history, old and new bustle of London, or the rain drenched beauty of wales or the rugged forgotten roman walls and good cheer of the North & Yorkshire, Cheap nights out in Newcastle & Hull, down to the thick accents and British farmland of the Devon & Cornwall counties, and the English Riviera or the Brighton - Portsmouth coasts. Oh, and the English and their obsession with Football, Tennis and Cricket, Horse Racing and Royalty.

Posted:3 years ago

#12

Tim Carter
Designer - Writer - Producer

550 268 0.5
If developers in Ontario want to take advantage of the Toronto Ubisoft "anchor store", they need to move to Toronto. We can't create a cluster spread all over Ontario. It needs to be focussed within one morning's commute. The "cost of living is cheaper" argument is a great lure for mediocre talent - but top-level talent will be able to afford a higher cost of living, and will want to live in a culturally rich and diverse worldclass city - which Toronto is.

Edited 1 times. Last edit by Tim Carter on 30th June 2011 9:04pm

Posted:3 years ago

#13

Gregory Keenan

102 11 0.1
@Fran - I agree; Ive often found that the UK has a brilliant habbit of talking its self down whenever we do something well. I think people like the poetic notion of "our slow decay" from the Empire days, although I think the turning point is coming soon. It may take a massive loss (such as our UN seat....(Seriously, this has been on the table O.O)) but hopefully the attitude will change.

Perceived Prestige vs Reality and i think the games industry in this county has had a massive hill to climb to show the Government its reality.

Posted:3 years ago

#14
@Fran - ownership of IP is a major issue that doesn't get brought up much. I mean, sure there are big triple-A titles being developed and created by Canadians, but how many of those are owned by Canadians? How much of that $X billion dollars a year that the game industry brings in a year actually goes to Canadian businesses at the end of the day? I would estimate 'not much' when it's all said and done.

A quote that I've heard many times, both with respect to the Game Industry, but also film / tv etc is that Vancouver (and Canada as a whole) is a 'service town' - ie somewhere that foreign companies come to get work done cheap. We have the Hub potential of a San Fran or Bay Area, but no VC backing. We have the talent, schools and infrastructure to become a world leader, but without the funding to launch & back startup projects, it's all for nothing.

Then again, as I type this, here I am in startup #3 seeing if I can figure out the magic formula to make it work 'this time' ;}

Posted:3 years ago

#15

Private
VIdeo Games

103 14 0.1
I left the UK for Canada, the grass was greener and by far!

Posted:3 years ago

#16
Very nice article. This comes at about the right time to fill some gaps in my knowledge as I am currently looking to relocate to Canada so I feel the effects first-hand.

While I'm an experienced talented programmer and a big studio has answered positively to my application, it eventually hit a dead end because of that government fast-track of programmers that shut down.

On one hand, the industry in Canada can't hire experienced people without poaching from other studios.
On the other hand, there are people like me who want to get in but can't because the government does not make it easy.

Edited 1 times. Last edit by Jean-Louis Ly on 1st July 2011 4:37am

Posted:3 years ago

#17
@ Gregory - indeed. We're an awesome country, it's just a shame many of our own people have become conditioned to look down upon the land of their birth.

@ Mike - I'd agree with everything you said. In the case of Ubi, it's Canadian tax payers paying for the creation of IP and profits that, for the most part, goes back to France.

@ Graeme - fair enough. Personally, in an ideal world I'd rather stay and fix up my own garden where generations of my family have lived than move to someone else's, but it's up to you:)

In other news, happy Canada Day to those Canadians on this thread! I'll be at the Canada Day celebrations in London with my wife and a bunch of other Canadians. I've already told her that if she loses me there's a good chance she'll find me at the poutine stall, tucking into my fourth or fifth plate. I just hope she catches me before I lift my head up, a chip falling from my mouth, muttering "more... pouti..." and explode:)

Edited 1 times. Last edit by Fran Mulhern on 1st July 2011 8:10am

Posted:3 years ago

#18
@ Fran - Poutine. looks like fresh cut chips with mayo + japanese veg sauce. Where can one try some in London?

Posted:3 years ago

#19
You can't, really. they do it at The Maple Leaf in Covent Garden, but it's not the same. It's a decent pub though, and they often show hockey (though it's recorded). It's meant to be a Canadian pub, I'm not sure how much it is, really. Sticking some old hockey shirts up on the walls doesn't really make it so.

Are you in London? Why don't you join us tonight at Trafalgar Square? Message me your mobile number - I'll be there with my wife and a bunch of Canadians who all work in TV/features here as either animators, compositors or matte painters - you'll make some good contacts while getting some great food! We're a nice bunch:)

Edited 1 times. Last edit by Fran Mulhern on 1st July 2011 10:47am

Posted:3 years ago

#20
@ Fran - Our studio is in Central London. I'd love to attend but am swamped with work all this month really. But should hopefully clear the deck for Develop Brighton! Thanks for the message and call out though! Enjoy your Poutine indeed! Looks like we import enough Canucks vs our export of Brits to Canada to hopefulyl keep a even tally!

Posted:3 years ago

#21
Yeah, the Canadians we import tend to work in TV/features. Because of our tax breaks. But apparently the government doesn't see fit to do the same for the games industry.

Funny, that!

Posted:3 years ago

#22

Francois Roughol
Senior Level Designer

2 0 0.0
Being French, the move to Montreal in 2007 seemed entirely logical back then, at a time when some French studios were treating talent like some dirty old socks they could pay slightly above minimum wage, without overtime (compensated or paid), on a shitty temporary contract only to send them all packing after production was done. Rinse and repeat.

It's all good to be dissing on the Canadian tax breaks when they apparently steal talent away from their home country, but let's start looking at what actually exists in these countries like the UK and France. Today again, Black Rock closes down. There goes a few people's lives down the drain again. Had the UK voted tax breaks for the industry, those people may still have their jobs right now.

So yeah Quebec has funny accents, French Canadians, bad weather and worse winters that last 6 months (the single biggest reason for a lot of expats to leave eventually, when they can't take it anymore) but at least, people can make a good living and not risk having to move halfway across their own country for a new not so stable position. There are arguably 5 cities in the West that can boast that. Los Angeles, Seattle, Montreal, London and Paris. Places large enough with enough studios that you may get another job if you lose yours.

We all know how hard visas can be to go to the US, and the UK and French industry aren't exactly booming. So what's the only other place?

PS: On a side note regarding the salary war, it doesn't have to come to that. Back in 07 when I moved to Montreal, my purchasing power (not the salary) after all costs had been paid was still 2.3 times what it was in France. Same group (Ubisoft), very different business practices...

Edited 1 times. Last edit by Francois Roughol on 1st July 2011 1:25pm

Posted:3 years ago

#23

Private
VIdeo Games

103 14 0.1
@Fran

If you're able to fix up your own garden great, but I personally don't see it happening any time soon. I'll continue to enjoy being away and come and retire back in Scotland in peace in years to come :)

Also Canada benefits a hell of a lot of Ubi being there, the amount of jobs generated around Ubisoft Montreal is huge, it's not just profits going back to France.

Posted:3 years ago

#24
@ Graeme

Sorry, I realise that my previous post sounded like I was being sarcastic - not at all. I genuinely mean each to their own - I've no business somehow looking down on people who have left in search of a better life abroad. I just really wish people like you - intelligent, well educated, etc - could stay and help fix things here, that's all. It just saddens me, really.

Re Ubi, of course the local economy benefits. I'm just interested if it benefits as much as people think - my gut feeling is no.

Posted:3 years ago

#25

Private
VIdeo Games

103 14 0.1
@ Fran

Having worked there for nearly 4 years I'd say it benefited the local economy a lot.

There's food, drinks, cars, houses etc A lot of business gets generated because Ubisoft is there.

Posted:3 years ago

#26

Bonnie Patterson
Freelance Narrative Designer

157 422 2.7
After looking at studies of how workers are treated in terms of hours, time off, pay and job security, Canada right now looks like one of the best places in the world to be employed - possibly even the best, depending on your personal foibles.

Add in the clean air and the wonderful people and suddenly...

OH GOD GIVE ME A JOB PLEEEEEHEHEHEHEEEASE

Posted:3 years ago

#27

J. Goldmaker
Community Management

26 0 0.0
Ontario is one of the worst places to live if you have a disability. They recently shaved off $125.00 a month in food allowances. They expect a person with a disability to live in a large cosmopolitan area like Toronto on around $1100.00 a month for everything. Don't get sick or burnt out if you move here.

Posted:3 years ago

#28

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