Della Rocca: Industry must think globally

Chasing local tax breaks is a waste of focus says former IGDA head

Jason Della Rocca, former IGDA head and founder of consultancy firm Perimeter Partners, has told that the industry needs to think globally instead of focusing on local tax-breaks and regional superiority.

Speaking in an interview conducted at the Nordic Game Festival earlier this month, Della Rocca spoke about the ubiquitous subject of the tax-breaks which many feel give Canada such an advantage in the industry, arguing that in fact they are but a small portion of a larger eco-system which has created a healthy sector in the region. Putting so much energy into chasing tax-breaks as a do-it-all solution is actually something of a waste, he believes.

"Well you know, look at California," said Della Rocca when asked about the accusations of talent drain levelled at Canada. "They have forty per cent of the US industry's workforce. There are no incentives there. Do we say that that pooling is cannibalising the rest of the country? I mean, it absolutely is - people are coming from all over the world to work at the awesome companies there.

"So Canada can also be 'blamed' for maybe recreating a bit of that through the incentives and the job creation demand, but my sense is that it's more rhetoric. 'Look at Canada and all they've done!' Can we actually look at the people and see how many people actually left and went to Canada? I don't get the sense that it's planes full of UK developers.

"So are they stealing those people? I don't know. Maybe, but I don't really know. It'd be interesting to look at those numbers and see what sort of effect it has. I'm much more thinking in a global perspective. Although I may help specific governments grow their industry in their country, I want to see the industry be healthy on a global basis. So personally I don't care if you go from one country to another or not."

As helpful as tax-breaks have been to Canada, he feels, they are not a magic tonic which will create a healthy industry from nothing. Firstly a region needs an established industry base as a starting point, with all of the education, infrastructure and talent that requires.

"The tax-break issue... It's not about the tax-breaks alone. When I talk about the industry I talk about an eco-system kind of metaphor. It's very dynamic, it's a complex system, there's lots going on, it's not clear that introducing a tax-break is going to be the thing that all of a sudden makes your ecosystem thrive.

"In fact there are regions where there's nothing - it's a desert. So you say, we have this desert and we'd really like there to be a game industry there because we think it's sexy and good jobs etc. So they look at Canada and say, well, they're doing so well because they have these tax-breaks, let's put a tax-break in our desert.

"You have a better chance of engaging and educating your membership about the changing dynamics of the game economy than you do running against a wall of politicians.

"So they put a tax-break in the desert, and guess what? Nothing happens. Because a tax-break alone isn't enough. Now of course the UK is not a desert and there's a long-standing industry and all kinds of companies and schools and stuff, so a tax-break would have some kind of effect, but the point is that it's not the only thing.

"If you look at Canada, there's all kinds of stuff going on."

The UK industry, Della Rocca argued, could have been in better shape if it had invested more time and energy into business acumen and educating on new business models that lobbying government for incentives. Had that happened three years ago, Britain could have been ahead of the curve on vital new methods of distribution.

"I was saying," says Della Rocca of a discussion at Develop in Brighton some time ago, "there's all these digital distribution channels that are emerging. Online, mobile, the iPhone was just emerging - explore that, work with development studios to exploit this new paradigm.

"You have a better chance of engaging and educating your membership about the changing dynamics of the game economy than you do running against a wall of politicians.

"Recently, I think in the last few months, TIGA announced some digital distribution training seminar. Great - but they should have done that three years ago. Had they done that three years ago, again, pure speculation, imagine they'd been talking to the UK studios and entrepreneurs and start-ups then. If they'd got started on these platforms three years ago? To me, that would have had much more impact than if they had won tax breaks.

"It's a complex system, and it's hard to predict what one change would have on that system, but it's really not about tax breaks, it's about so much other stuff."

A full transcript of the interview with Jason is available here

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Latest comments (8)

Michal Doniec R&D Engineer, The Mill9 years ago
"(Look at Califronia) They have forty per cent of the US industry's workforce. There are no incentives there."
No? Venice Beach, weather, surfing?:)
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Tony Johns9 years ago
A healthy gaming industry needs awesome games being developed by awesome people, tax breaks will do nothing unless if there are awesome games being made and there is a radical break from all the Project miss-Management that sometimes ruins potential great games...

You need the ideas being decided by one or who great visionaries...not a whole group of industry analysists that think they know the market and so they develop the same sort of games year by year.
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Miguel Melo Principal Software Engineer/Product Manager 9 years ago
@Michal Doniec: if it was that simple, we'd have a massive games industry down here in Portugal. Or, at the very least, _any_ semblance of a games industry... :-S
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Show all comments (8)
@ Michal + 1 Lack of Culture?
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Consultant: "Wah wah denial denial social iphone buzzword buzzword facebook mobile buzzword blaaaaah."

Seriously, did the guy actually say "Tax breaks won't work because you need a culture and an industry base and an existing talent pool" with reference to the UK? And then try to walk it back? Just amazing, purest corpspeak whitewash.
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Have to say I was amazed at how ignorant he came across - showy statements with nothing to back them up. Might just be a bad day at the interview though :P
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I'd say Jason has made a good point. I think he's couched his argument in terms of the big debate in the UK regarding tax incentives and other government intervention to 'even the playing field' against 'unfair competition' from abroad. I think he's made a good case for looking beyond a 'silver bullet' like tax breaks to fix what's not working (for some) in the UK industry.

So I'd say his real message is that UK game developers need to educate and ENGAGE themselves in what's happening globally. IMO this means learning more about how thing's work outside the UK and bringing the ideas, people, etc. that can help you (whether just next-door or on the other side of the world) into your business.

Admittedly, this isn't an overnight process. Many developers just don't feel they have the time and/or money to reeducate themselves. If you're trying to survive as a small business (with all the issues many SMEs face, regardless of the industry) or just keep-up in a highly competitive, innovative and globalised market using yesterday's business model, this can seem like a luxury. Until you go out of business, of course. But by then it's obviously too late.*

*Spoken from experience :-)
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Jason Della Rocca CEO & Co-Founder 9 years ago
@William, @Barry: Ooph, harsh... can you be more specific about my ignorance? Also, might be helpful to read the full interview (linked at the end of the article above). The excerpts here can come across somewhat out of context. That might help, or may just make me come across all the more ignorant! Damn.
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