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Game On: France's games industry

Eirwen WilliamsEirwen WilliamsApril 20, 2012 at 2:13 AM0
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The market for online, social-network, and mobile games has been on fire over the last several years.  It has grown into a multi-billion dollar industry and is expected to continue its rapid growth for the foreseeable future, particularly in Europe (see recent studies on the sector here and here).
Of course the key questions we have at Rude Baguette are 1) how are French game developers, producers, and distributors doing and 2) are they are well-positioned to capitalize on this massive growth.  In many ways, France should be in a good position to be a leader in the sector given its rich history with gaming giants such as  Ubisoft, Activision Blizzard (yes US based, but owned by Vivendi), and, more recently, Gameloft.
However, France’s core strengths in gaming tend to focus more on the serious and/or console gaming segments of the industry.  Online, mobile, and social-network gaming is a whole other animal where its (relatively) low barriers to entry and its access to open development platforms make it much easier for small-scale developers to develop that hit game and become kings virtually overnight (i.e. Zynga, Wooga, Playfish, Rovio, etc).  Gameloft, a leader in online and, increasingly, in mobile gaming certainly should be considered a French success story.  But  what are France’s other examples?  What is going on in France’s gaming sector in general and why does France have a real shot to be able to clearly establish itself as leader in this space?
I put these questions to Nicolas Gaume, president of the Syndicat National de Jeu Vidéo (SNJV), who is also a serial games industry entrepreneur with ventures such as the industry pioneering Kalista and, more recently, Mimesis Republic:
I know France has a rich history in the games sector.  How is France doing today?
We still have many leaders in the traditional gaming space such as Ubisoft, which you probably know…But we also still have many successful game studios, such as Quantic Dream, Asobo (who does the Pixar games), Arkane Studios (based in Lyon and recently purchased by a US studio), and there are lots of others.  SNJV has 200+ companies [in its membership]. Many of these are still in the traditional gaming space, developing console games.  There is now a new breed that are growing thanks to casual, mobile, web and social games. We have several dynamic players in this space such as Bulkypix which was a spin-off of Vivendi, Gameloft of course, Ankama, and Kobojo in the social gaming space. We are said to be the biggest production space for social gaming after the US and the same for iPhone games.  But, the truth is that we have a lot of small companies and they are very scattered.
Does France have what it takes to be a powerhouse in online, social and mobile games?
Yes. We are a place where games are made.  We host and generate successful game companies and that’s a fact.  There are some things in the environment that need to be improved, but there are three things that makes France well-positioned in the sector:
1. We have a focus on technology and art which is useful as our sector is one which draws on cross-innovation and learning.  The education system, which takes a more generalist approach also helps to foster this.
2. We have leaders in the sector which serve as an inspiration for startups and smaller players.  They see these leaders and say to themselves I can also develop a sustainable, successful game company from France
3.There are many financial incentives such as the Crédit Impôt de Jeu Vidéo where 20% of production costs are refunded by the state and the Crédit Impôt de Recherche which also can be added on top.  They’re probably not enough vs what is given in other countries, but it is still very interesting.  France has been in the forefront in Europe in this regard.
Is  France known as a key player in the global games industry?  What is SNJV doing to help?
I don’t think it’s known that France is, for example, the second biggest producer of social games.  However, 70% of our entire production is sold outside of France.  So, we do have an appetite in the French games industry for the ‘world’.  SNJV has recently launched “Le Game” which is an important way for us to get the word out globally about the games industry in France.  SNJV also has several other activities to help our members develop, such as training, advising and providing information (on financial incentives/investment and legal matters) and assisting on exports and sales.
What are the challenges that you see for game developers in France?
There are several.  But, what’s exciting about the industry though is that its really about threats and opportunities. For example, in traditional gaming, where people would purchase a game for 50€/60€, the model was much simpler.  This is not working quite as well as it used to.  Now there are a lot of new models, such as freemium and subscription.  This has changed a lot of habits, but it also has created a lot of opportunities.  We’ve been quite fortunate in France to see successful companies emerge.  Some have been purchased by or partnered with larger companies (i.e. Ubisoft).  This has created an interesting ecosystem and is also driving our training ground.  The fact is that our expertise in France is individual talents…the challenge is getting all these talents to work well together and connecting them to the market.
Another challenge is that we have many small companies and some large players, but not as many in the middle.  This is primarily due to lack of investment.  As with other tech industries we need investment to expand…however, game development tends to be more capital intensive, so we tend to ask for more investment than a traditional startup.  This is not the typical discussion for many VCs.  SNJV is working on ways to attract investors as well as explore how other funding possibilities, such as government initiatives (i.e. investment funds), might be useful.
In addition to helping develop France’s games industry, SNJV also periodically provides interesting research on the games sector in France.  You can find their most recent study here.
 

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