Latest news with #IntotheDead:OurDarkestDays
Otago Daily Times
27-04-2025
- Business
- Otago Daily Times
Powering New Zealand Game Studios with the Co-Development Model
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.
RNZ News
22-04-2025
- Business
- RNZ News
Local game developers call for more tax relief to stay in New Zealand
Labour leader Chris Hipkins tries his hand at Into the Dead: Our Darkest Days. Photo: RNZ / Samuel Rillstone A leading New Zealand video game developer has praised a rebate scheme introduced by the previous government, but says the cap may need to be increased, if firms want to keep their operations in New Zealand. The gaming industry, which is aiming for $1 billion in export revenue by 2028, is one of New Zealand's fastest growing sectors, with a recent industry report showing it grew by 26 percent in 2024, compared to the global average of 2.1 percent . In 2023, the Labour government introduced a 20 percent tax rebate scheme for video game developers, which the current government has kept. Studios that met the minimum $250,000 expenditure threshold per year could receive up to $3 million a year in rebate funding. The Game Development Sector Rebate (GDSR) was designed to ward off overtures from overseas developers, and keep more staff and operations in New Zealand. Developers were losing staff to Australian firms , which receive a 30 percent rebate (up to AU$20m), with some states adding their own rebates on top of the federal scheme. Registered developers are currently applying for the 2025 round, which is administered by NZ On Air. Applications close on 9 May, with decisions due by 14 July. Wellington-based developer PikPok said the GDSR was the difference between them staying in New Zealand and moving offshore. "There were a lot of challenges coming through and out of Covid," chief executive Mario Wynands said. "In particular, it made a lot of sense on paper for us to move some portion or all of the studio to Australia. "We were actively investigating that and the GDSR is a big part of why we chose to remain in New Zealand." Budget 2023 contained funding of $40m per year for four years to deliver and administrate a rebate scheme for the gaming sector. The coalition has kept the rebate scheme and will review it after two years. In its first full year, about $12m was paid to 32 studios, with an initial pilot phase, bringing the total payout to $23m. PikPok was one of two companies to receive the full $3m allocation in the first year, along with Grinding Gear Games, but PikPok financial officer Lance Burgess said the claim cap may need to be increased. "The two largest studios in New Zealand are at that cap now, so there needs to be some thought around whether that cap is appropriate," he said. "Otherwise, there is a risk that the two largest studios may look to put some of their talent offshore." Wynands said PikPok had acquired a company in Colombia three years ago, which opened up expansion opportunities, and there remained an incentive to open some sort of on-the-ground footprint in Australia. "It's a combination of, 'Where does the market go? What benefits the business? What can we grow here? What can't we grow here? What skills do we need to access to that we otherwise can't build the capability for?'" Visiting PikPok's Wellington headquarters to hear from the company's leadership - and try out its latest game, Into the Dead: Our Darkest Days - Labour leader Chris Hipkins touted the scheme's success. "We did realise, back in 2023, we were going to lose businesses in this industry, if we didn't do something to encourage them to stay in New Zealand, which was why the gaming rebate was introduced," he said. "As a result, not only are we keeping them, but now the sector's growing and it generates good, well-paid jobs for New Zealand." Hipkins said the funding envelope set aside was "reasonable" as the industry grows and expected there would be more calls for the envelope. He said he would await the outcome of the current government's review of the scheme to decide whether to extend it, should Labour return to office, although early signs were encouraging. PikPok chief executive Mario Wynands. Photo: RNZ / Samuel Rillstone "They're exactly the sort of thing that we were looking for, so we've got now an industry here that's growing healthily and that was what we were aiming to achieve. If you look at the big indicator that's available at the moment, it's a very, very good start." Some developers that claimed the rebate are owned by overseas firms, but continue to operate in New Zealand. Grinding Gear Games - developer of the Path of Exile series, which counts Elon Musk among its fans - was acquired by Chinese holding company Tencent in 2018, while developer Ninja Kiwi has been owned by Swedish company Modern Times Group since 2021. Burgess said there was no reason to restrict the scheme to New Zealand-owned companies. "While these companies still develop games in New Zealand and employ people here, and pay tax here, I can't see why they should not be included." Hipkins said the alternative was these businesses would do their business elsewhere, and New Zealand would not benefit from their economic activity or the tax take that came with it. Sign up for Ngā Pitopito Kōrero , a daily newsletter curated by our editors and delivered straight to your inbox every weekday.
