Powering New Zealand Game Studios with the Co-Development Model

Otago Daily Times

27-04-2025

Global developer Virtuos on how co-development might be the answer to challenges faced by game studios in New Zealand.
New Zealand's games industry is undoubtedly on the rise, driven by significant market performance, government backing, and a growing demand for talent that underscore the country's expanding influence in the global games market.
According to the NZGDA Industry Report 2024, game developers in New Zealand brought in an impressive NZ$548M in the last financial year—a remarkable 26% jump that outpaces the global growth rate of 2.1%. Looking ahead to 2025, highly anticipated titles like Tales of the Shire by Wētā Workshop and Into the Dead : Our Darkest Days showcase the creativity and talent driving New Zealand's games sector.
However, like in many emerging markets, developers in New Zealand—most of whom are mid-sized teams—face considerable challenges that could hinder their success on the international stage. Talent shortage, platform engineering expertise, and funding limitations remain some of the most pressing issues.
To address those barriers, Kiwi game studios can leverage the co-development ('co-dev') model. This collaborative approach allows them to partner with international developers to create more ambitious projects and extend their original IPs across multiple platforms. By integrating a co-dev partner, studios can efficiently scale production, manage risks, and control costs.
'Unlike traditional outsourcing, a co-dev partner acts as a natural extension of the developer's internal teams and pipelines,' said Kristian Pedlow, Senior Art Director at Virtuos, who is currently based in the Australia and New Zealand region. 'This model is particularly beneficial for mid-sized studios, enabling them to quickly acquire the expertise required for new platforms or engines and expand their team size without the need for extensive and costly internal training or hiring.'
NZGDA reported that skill shortages, particularly in programming, are a major concern with 31% of studios citing a need for experienced programmers. At the same time, PC gaming remains dominant and generates over half of industry revenue, while console games account for just 14%—indicating a gap in console game development exposure and expertise. That is further compounded by the need for larger engineering teams skilled in rendering optimization and across all industry-leading game engines, fueled by the growing demand for cross-platform releases. While cross-platform release is an increasingly successful strategy for developers to minimize risk and maximize revenue in today's market, studios are challenged in putting together a team of the required scale and expertise while meeting shorter release schedules for post-launch content.
Pedlow emphasized that filling skill gaps and boosting development capacity allows studios to focus on a primary platform while partners handle adaptations for additional platforms. This parallel development process allows for simultaneous game releases across multiple platforms, expanding their reach to a broader audience across more markets.
Faced with hurdles such as resource limitations, project management, and technical challenges, emerging studios lacking the necessary expertise and scale often struggle to secure funding for AA game projects. Without a strong track record, convincing investors of a project's feasibility and success can be an uphill battle. Beyond the game's unique art directions and commercial potential, successful pitches must address key risks and present clear solutions. Partnering experienced co-dev teams can help bridge these gaps, boosting investor confidence through demonstrated project feasibility.
'An ideal co-dev partner should have a proven track record, demonstrating reliability and expertise in shipping successful and high-quality titles.'
Choosing the right co-dev partner can make or break a game. 'An ideal co-dev partner should have a proven track record, demonstrating reliability and expertise in shipping successful and high-quality titles,' said Philippe Angely, Managing Director of North Asia at Virtuos. 'Studios should also consider the partner's engineering capabilities and platform knowledge as key factors, as these assets not only help solve technical challenges during production but also create learning opportunities for their in-house teams.'
While co-dev is not the only model available, it offers New Zealand's ambitious game studios a sustainable way to scale and achieve greater success. By maintaining lean teams in the early stages, developers can focus on creative breakthroughs before scaling up for full game production. This is where co-dev makes a difference—empowering studios to push creative boundaries with the support of experienced partners to realize their vision for the game.
'At the end of the day, making games should be fun. Your best co-dev partner is one who shares your vision and is just as passionate about bringing the game to life as you,' Angely added.