Preview: GameON Finance 2011
Interactive Ontario's Ian Kelso outlines plans for the Toronto event
One of the first industry-specific events of 2011 is fast-approaching - GameON: Finance, organised by Interactive Ontario takes place in just a couple of weeks in Toronto.
Here, president and CEO Ian Kelso explains what the event is all about, and what you can expect if you're planning to attend.
We set up the event in 2008. The genesis kind of came from the explosion of the Wii into the market place, and seeing that there was a deficit of titles in a number of categories. At the same time some of the digital distribution platforms were starting to take off, and while the traditional model for publishing and financing games served the hardcore quite well - it was very well modulated for a specific set of demographics and types of titles - but there seemed to be this burgeoning, new and alternative need for content which the existing publishers really weren't set up to serve. Kids, senior citizens and women, for example.
So it seemed to us that there was an emergence of a fairly strong need for sources of capital for the games industry, and we started looking at what some of those sources might be. Would they be down a traditional equity route, would they be angel investors? In the film industry, several different models have been tried over the years to encourage investment in the early stages, and in Canada we've had different types of tax incentive programmes to try to get the private sector to invest in entertainment product.
And then there were a lot of government levers - whether they be tax credits, or subsidy programmes, especially in the early stages to underwrite the risk for young start-up companies.
One of the problems for developers, if you can call it that, with the tax credit system is that you don't get the money at the front end; you get it after you commercialise the product, so there's also a gap financing problem that companies face - how they cashflow and make the game knowing they'll collect a cheque after it's published. How do they actually pay the employees all the way there.
So there were all these different types of financing problems, and there really wasn't a venue that directly attacked that issue - which is always kind of odd, because in the traditional technology space there's always a lot of forums for discussion about financial mechanisms, looking at best practices and methodologies for piecing together the financial structures for a project; or for underwriting and funding your company.
We saw it was something that wasn't being done, and that we had some expertise in - drawing from the film, TV and tech industries - and decided to have a one-day forum to talk about what might be the future of financing for the games industry.
That was January 2008, and we followed up with a second forum in the Fall that year, and again in 2009. This time around we're back to the beginning of the year, partly due to our own internal event calendar, and partly to find the best space in among some of the other international events.
There'll be developers, across different game platforms and distribution methodologies - the console games companies, and digital distribution platforms. There's been a real explosion here, as with everywhere, of development for the portable platforms - the smartphones, iOS, Android and so on. And of course the social media space as well.