Is the industry really suffering from a crisis in innovation, as risk-averse publishers cancel promising projects simply because they don't understand them and talented developers are forced to shut up shop despite having huge potential hits on their hands? Or are these just the harsh realities of a commercial market where the fittest developers survive, and a regular cycle of studios opening and shutting down is to be expected as part of the healthy operation of the industry?
They're big questions, and ones which cause plenty of arguments among senior industry figures - particularly in the UK, which has seen many of its development studios go under in the last few years. Some claim that this is a creative crisis for the industry; others argue that it's simply to be expected that a lot of studio start-ups will fail, leaving only the healthiest companies to rise to the top. A cynic might point out that these ideological arguments tend to divide quite cleanly between those who've been through a catastrophic studio failure (or two), and those who have sat happily at a successful studio throughout the past years, but there are compelling points to be made on both sides of the debate regardless.
The latest round of navel-gazing has been prompted, of course, by today's announcement that North London based Elixir Studios is to shut its doors, following the cancellation of its main project by a large, unnamed, but easy to guess US publisher. According to Elixir, their failure can largely be pinned on the fact that they are working on original IP in a market which is incredibly averse to the risk constituted by anything other than sequels or licensed properties. To some extent, it's a fair point; a quick and admittedly not terribly empirical survey of cancelled projects in the past couple of years shows quite clearly that far more original IP projects are canned than franchise projects.
Critics of the company, however, have been quick to point out that Elixir has published two games in seven years, one of which - Republic - was critically mauled after being built up to levels of hype of which Peter Molyneux would have been proud, while the other, Evil Genius, was a very solid and enjoyable game, but not exactly a massive commercial success. Elixir's track record of published titles, at least as much as its focus on original IP, won't have helped its chances of surviving a project cull at a publisher - or so the argument goes.
Elixir unquestionably had some incredibly talented people working for it. Those people will now scatter and join other companies, or will form together to create new studios, some of which may be healthier than the "parent" studio - Elixir itself - was. That's the sign of a healthy business and creative ecosystem, according to proponents of the second school of thought. On the other hand, there's no denying the attraction of the old model of strong independent developers who could afford to invest heavily in original IP and commit resources to long-term projects - but judging from the evidence of the last couple of years, this model truly belongs in the past.
In that case, we can expect to see more and more announcements of studios setting up and going bust in the future - a model not dissimilar to the movie and music industries, in fact. However, if studios shutting down are to become an even more regular part of life in the games industry, there's one lesson they could definitely take from Elixir's demise. It speaks volumes that many in the industry are amazed at the firm's decision to shut down cleanly and pay full redundancy to all of its staff. It would be unthinkable in many other industries for this not to happen, but the fact that Elixir's management have acted in such a professional and laudable manner is actually genuinely surprising in the UK development sector.
There's no need to point fingers. Plenty are already pointed, and your ear doesn't have to be too close to the ground to know which companies, and which senior executives, seriously screwed their staff over in their death throes. While the debate may still rage over why Elixir had to die, at least its management team can lock the doors secure in the knowledge that when the time came, they did the right thing by their employees - and hopefully in doing so, have set a trend that will continue next time a UK developer sees the wall rapidly approaching.
Rob Fahey is GamesIndustry.biz' editor, and can be reached at [email@example.com].
This editorial originally appeared in the GamesIndustry.biz News Digest, a free email news bulletin which is distributed to subscribers every day of the week and features a round-up of the key headlines of the day, the latest major share movements from industry companies, and the day's new job postings. Each Thursday afternoon, this digest is presented in a special omnibus form with the week's game charts and an editorial focus piece.
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