Southland a Key Player in Game Industry
As Microsoft Corp. and Nintendo Co. this week launch high-tech video game consoles, few regions have as much riding on their success as Southern California, which has quietly become pivotal to the $20-billion global video game industry.
More game companies call Southern California home than anywhere outside Silicon Valley. The shift represents the development of games from geeky pastime to mass entertainment driven less by technology and more by drama, characters, music and fantastic visuals.
In short, games now have all the ingredients of a Hollywood blockbuster, creating a substantial and growing industry that employs thousands from San Diego to Santa Barbara. In addition to workers at the game companies themselves, thousands more compose soundtracks, craft special effects and lend their voices to virtual characters.
So concentrated is the talent that it’s drawing others. Key designers are pulling up stakes and moving from Silicon Valley to Los Angeles. And as much of the rest of the technology industry sputters, games are going strong.
Microsoft, Nintendo and Sony Corp. plan to spend $1 billion over the next few months just marketing their game machines to consumers hungry for stay-at-home entertainment. Microsoft’s $300 Xbox debuts today. Nintendo’s $200 GameCube hits stores Sunday. Both will compete for holiday buyers against Sony’s $300 PlayStation 2.
Despite impressive technical specifications, the machines need a steady stream of high-quality titles to keep buyers happy.
“It’s about entertainment,” said Jason Bell, senior vice president of Infogrames Inc., which this year moved its offices from San Jose to Santa Monica. “It ain’t about technology. Technology, of course, remains a critical component of games, but it has to be invisible to the consumer. People don’t care how many calculations per second your game makes. They just want to know if it’s fun.”
Half of the top 10 game companies in the United States not part of a hardware company are in Southern California, including Activision Inc., THQ Inc., Interplay Entertainment Corp., Infogrames and Vivendi Universal Games. Two of those, Santa Monica-based Activision and Calabasas-based THQ, are the second-and third-largest in the industry. The largest, Redwood City, Calif.-based Electronic Arts Inc., has two studios in Southern California.
“Right now, Southern California has a bit of a leg up over Northern California in terms of overall importance within the games industry,” said Miguel Iribarren, an analyst with Wedbush Morgan Securities in Los Angeles. “A lot of that has to do with the fact that this is such a media-intensive area. For games, the tie-ins with Hollywood have become pretty important, and that plays to the advantage of THQ and Activision, both of whom have leveraged Hollywood properties to make successful games.”
Activision, which last year posted $620 million in revenue, is making a game based on the upcoming “Spider-Man” movie. And THQ, with $347 million in annual sales, has built titles based on TV shows such as “Rugrats” and “Sponge Bob Square Pants.”
It’s not just proximity to intellectual property that attracts game companies to the area. It’s also access to talent--from writers and actors to composers and animators. Thanks to unprecedented computing power packed into today’s consoles, some games now have as many special effects as films.
“Ten years ago, video game characters were these crude things that were 5 pixels high, and you could compose the music on your telephone keypad,” said Geoff Keighley, a journalist who has covered the industry for more than a decade. “Now, they’re using 80-piece orchestras and professional voice actors. As these new game consoles allow for more visual panache and sonic flare, there will be more demand for top creative talent to create these games. That just means more business for people here in Hollywood.”
For instance, composer Harry Gregson-Williams, who wrote music for “Shrek,” “Chicken Run” and “Armageddon,” recently scored his first video game, the highly anticipated “Metal Gear Solid 2” for Sony PlayStation 2.
“I hadn’t thought of doing music for a video game before,” Gregson-Williams said at his Santa Monica studio. “But it was stimulating and fun.”
The game was programmed in Japan, but the voice-overs and music were recorded in Los Angeles.
That Southern California has blossomed into a center for video game production is fortuitous. As film production migrates from Hollywood toward less expensive locales, games are providing a steady flow of work.
“It’s been a fairly substantial part of our business in the past year,” said Paul Doherty, vice president of CED Talent Agency Inc. in West Los Angeles, which represents about 100 voice actors. “It certainly seems to have been a growth business in the last five years.”
Doherty said about a quarter of his agency’s bookings for animation voice-overs come from game industry clients.
House of Moves in Los Angeles, which does motion capture for computer-generated animation and special effects, began six years ago doing work on movies, commercials and music videos. Today, 90% of its business comes from the game industry. The 30-person company is private and does not release its revenue figures.
“We started seeing video games taking over about four years ago,” said Jarrod Phillips, vice president and executive producer of House of Moves, which worked on “Star Wars Rogue Leader,” a game that will be released alongside Nintendo’s GameCube console Sunday. “In 1997, we tripled our revenue from the year before, and a big part of that was video games. Since then, revenues are about 10 times what they were in 1997. As a result, we’ve really tried to cater to that group.”
Even Microsoft is getting into the action, recently appointing Jordan Weisman as the company’s representative in Hollywood. Weisman, head of WizKids Games, is charged with the task of finding movies that can be turned into games and pitching Microsoft’s games as fodder for movies.
This isn’t Hollywood’s first flirtation with games. In the mid-1990s, film studios latched on to games as the next big thing. Fox, Disney, Universal Studios, MGM and DreamWorks all started “interactive” divisions to make games based on movies. But the effort stumbled once movie studios discovered it wasn’t so easy to make games. Since then, all except Universal Studios have radically scaled down their game divisions.
Hollywood soured on games, but game companies continued to work with Hollywood, licensing popular movie, television and music titles to make their games more marketable to mainstream consumers. Some companies moved to Southern California.
Activision made that leap in 1991 from Silicon Valley.
“As video games become more like motion pictures, the ability to tell stories becomes more critical,” said Bobby Kotick, chief executive of Activision in Santa Monica. “It’s easier to turn programmers into great storytellers here in Southern California than it is in Silicon Valley.”
As Activision grew to its current size of more than 900, some employees left to form their own companies, including Pandemic Studios in Santa Monica.
“Once big publishers put down roots, you have spinoffs, and the publisher will act as the anchor,” said Josh Resnick, president and founder of Pandemic. “And once you have spinoffs, they all start to feed off each other. Talent will move between companies. Then accountants and lawyers learn that we’re here, and they start providing specialized services. That, in turn, attracts more game talent.”
A few years ago, recruiting workers was difficult. For Silicon Valley workers, coming to Los Angeles meant leaving the world’s technology capitol. For Hollywood talent, working on games was something to fill in the gaps between film projects. That’s changed as games become increasingly sophisticated, said Jim Wilson, president of Universal Interactive, a unit of Vivendi Universal Games.
“We have people working here who used to work at movie studios,” Wilson said. “They’re here because they see games as the future of entertainment.”
“We used to have to do a big sell job on Los Angeles,” said Jason Rubin, founder and president of Naughty Dog, a game-development studio in Santa Monica. “I remember driving people around and saying, ‘It’s not so bad, is it?”’
With Bay Area rents sky-high and dot-com jobs dried up, drawing top talent to Los Angeles has become far easier, Rubin said.
Most recently, that talent includes American McGee and Dave Taylor, two of the industry’s best-known game developers. McGee and Taylor, who met while working on “Doom,” moved to Los Angeles in July from the Bay Area to start Carbon 6, a game publishing company. Within weeks, they landed a contract with Dimension Films to produce a game based on the upcoming “Spy Kids 2” movie.
“The only companies we can’t meet with here are Microsoft and Nintendo,” Taylor said. “But just about everybody else is here.”
