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."