Sydney-based games developer SSG recently released Warlord Battlecry II. The game took over 12 people around 15 months to develop, and relied heavily on outsourcing work to freelance 3D artists.

Twenty years ago, when SSG vice president Gregor Whiley began developing games for Apple II and Commodore 64s, a really complex game may have required the luxury of two developers, working part-time on the project while they kept their "real jobs" on the side.

These days, according to Whiley, the games industry does not allow any room for nostalgia or sentimentality. Games mean business, in no uncertain terms, and staying in the games business means taking the business of games very seriously.

"When you are dealing with publishers you are talking about very large companies, they are not in the slightest bit sentimental and the corporate graveyard for games developers is pretty chock-a-block," Whiley said. "Publishers will do everything they can to reduce their risks, they need to know the new game will look every bit as good as its competition and they want to know the developers will actually get the job done."

According to Whiley, most games don't make any money whatsoever, with publishers and distributors betting on the spectacular success of one or two to pay for the development of the rest.

Hence the tendency to compare the games developer business with certain aspects of the entertainment industry, rather than other modes of software development.

"We use technology to deliver it, but we are really in the entertainment business," explained Whiley's long time counterpart Adam Lancman. "We are competing against music and movies, it is all about predicting trends and staying in tune which what is happening in popular culture, securing licensing rights to movie titles and so forth."

Like Whiley, Lancman has spent more than 20 years in the games development industry. He began under his own Beam International brand in 1980, and after attempting to bridge the divide between publishing and development for seven years he sold off half the business and began to focus wholly on the latter. In 1999, Beam International was bought by French publisher and distributor Infogrames, and Lancman stayed on to head up their Australian operations.

"Infogrames are hungry for content, now we have four teams of people developing on the next generation platforms," Lancman said. "The next generation platforms like the X Box and PlayStation II take teams of around 30 people and can run for anywhere up to 18 months, we are talking about investments of anywhere up to US$6 million or more."

And if pundits' predictions are right, the games developer industry in Australia is in line for continued growth.

From Cottage to Kapow

Whiley and Lancman will readily admit the games development industry business was essentially started by IT enthusiasts, often working from home.

"As long as you could afford a computer you could get into the game industry," says Whiley. "But there was never any guarantee of success, a lot of companies that appeared during the eighties couldn't make it through the long haul."

The third party in this great games developer triumvirate would have to be John DeMargheriti, CEO of Microforte. Like SSG and Beam International, Microforte had its origins when DeMargheriti teamed up with a mate and started taking a professional interest in their hobby.

However, after nearly two decades in the industry one of DeMargheriti's overriding concerns is establishing professionalism within the industry, and raising the profile of Australian talent on the world stage.

"We may as well be in the Antarctic so far as many of the publishers are concerned," DeMargheritisays. "It is fundamental for us to work together in this industry to establish a pool of talent in Australia, so that it becomes recognised as a place to do business."

To this end DeMargheriti, teamed up with other industry representatives to establish the Games Developers Association of Australia (GDAA), of with Lancman is now the president. The GDAA is designed as a professional grouping of games producers charged with raising the profile of the industry, lobbying government on behalf of the sector, and increasing training and education opportunities.

DeMargheriti also helped to establish the Academy of Interactive Entertainment (AIE) in Canberra.

"Over the past 6 years we have trained 600 - 700 people, many of whom went into the industry in Australia either to found or work for games developers locally," DeMargheriti says. "Since we started we have seen a sort of mushroom effect as ex-students add to the locally available talent pool, and even go on to found their own companies."

Ian Gibson, current head of school, says the Austudy approved course prepares students for a career in 3D animation and programming, whether that be in games development or advertising, film or television. The full three-year course is divided into either the programming or design streams, and is open to everyone from post-graduates mathematicians, to high-school graduates with a talent for graphic design.

"The programmers are snapped up quite quickly out of the course, it may take a little more effort for some of the designers - they often have to be prepared to relocate, but there is plenty of work if they are prepared to go to it, rather than expect the work to come to them," Gibson says.

While it may sound like fun and games to many, Gibson says the course includes a business component, as well as the opportunity for programmers to work with designers on a real time project, the results of which are displayed on the institute's Web site.

However, it is not just graduates from this and other games developer courses who are contributing to growth in the sector. Increasing prevalent are business software developers, and managers looking to embrace opportunities they have seen in the sector.

Founded in 1999, Brisbane based Evolution Games is typical of a new wave of Australian games developers combining industry enthusiasm with business savvy. Evolution CEO Justin Green came into the industry from what he describes as a typical business background, having studies finance and accounting and gained initial experience in the business software sector.

"I started the business with my flatmate, Sean Hammond," Green said. "He was already involved in games programming, and we saw an opportunity to combine our skills."

Beginning the project in June 1999, by September the microteam of eight had managed to create a 20 min Web release of their first game, which caught the eye of a flotilla of publishers.

"The publishers take care of marketing the finished product to the public," Green said. "But we need to have a constant focus on marketing our team and skills, you need to keep a high profile in this business otherwise you will be overlooked."

Currently working with a team of 25, 21 of which are directly involved in creating the games themselves Green is fairly enthusiastic about growth opportunities in the sector. However, he is keeping a close reign on excess enthusiasm.

"It is great to work with such creative people, you get a real buss when you focus test the product with a bunch of kids," Green says. "IT is vary tempting just to grow rapidly, but you can bloat too quickly by taking on too many projects, we are going for a slower approach."

Like most in the industry Green concedes that the barriers to entry are excessively high at present, given the sheer manpower that goes into games for the latest platforms. However, through the GDAA, Lancman believes the industry will be able to improve its standing globally, and even attract venture capital to the sector.

Capitalising on success

"The one biggest factor limiting growth of the industry in Australia is lack of access to capital," explains Infograms Lancman. "It doesn't matter how good you are, an Australian developer has to go overseas to attract funds. If that money were available locally developers could build a game first and then sell it, and more importantly keep the IP in Australia."

One of the stated aims of the GDAA is to lobby government to attract attention to the sector appears to have paid off in Victoria, with the state government taking steps to support the industry at the state level, however as yet there is no such Federal approach.

As one of the few companies which has managed to attract local investment DeMargheriti says venture capital is not necessarily the kind of money the sector should be looking at courting.

-Venture capitalists are looking for a really high rate of return, and they are not necessarily in for the long haul of developing a company," DeMargheriti says. -We are now looking at creating our own venture capital in the form of a development fund, we've raised about eight million so far and are looking at funnelling it into the development space."

On the flip side of the development funds coin comes the risk associated with an industry largely dependent on the whims of the hardware developers. Evolution's Green points out that work put in to developing the drivers for new hardware platforms can be lost almost overnight when console vendors announce new release dates.

-As soon as the PlayStation 2 was announced no one wanted to know about PlayStation games anymore, and now that there are greater pricing pressures that side of the industry is changing more rapidly," Green says.

Like much of the IT industry games developers also have to contend with the difficulties associated with finding and keeping good staff. Green says it is common to loose animators to film studios, where the financial rewards are often greater. However, the ebb and flow of programmers is slowed by the different requirements in each sector.

-It takes a good six months for a traditional business software programmer to get used to this environment," Green said. -There are a lot more restrictions on things like memory that they are not used to working with."

And while games software developers may face an uphill battle in this country when it comes to convincing investors of the industry's merits SSG's Whiley has been around for long enough to know which tail is really wagging the dog.

-The business side of things is always going to be hard, like any industry we should be looking at developing lasting product and brand recognition so as to minimise the risk to the publishers," Whiley says. -But games have always been at the forefront of development, whether or not it is recognised by the rest of the industry."

He points to the way in which games have influenced the development of the PC, attributing sound cards, CD ROMs, 3D graphics chips, and even increased RAM capacity to the thirst for an ever more thrilling game experience.

-At least half of the hardware innovations that have gone into the PC were derived from improvements in games technology," Whiley said. -Because as soon as anyone got their hands on the first IBM PC they wanted to play games on it, the very fact that CPUs are as powerful as they are today is the result of games."

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