A new giant enters B.C.'s games industry
Vancouver studio to help Disney drive its games business

Michael McCullough
Vancouver Sun

Wednesday, April 20, 2005

A Walt Disney Co. subsidiary announced Tuesday it is setting up a game development studio in Vancouver as the world's largest entertainment firm vies to become a top-tier video-game publisher.

The new, as-yet unnamed Vancouver studio will be headed up by four local industry veterans, all of whom left high-ranking jobs at Electronic Arts Inc. last year.

The new studio already boasts 20 employees and will ramp up to between 60 and 80 within a year, said vice-president and general manager Josh Holmes. That would place it among the top five gaming studios in the city.

The new venture was the brainchild of Holmes, the new studio's vice-president of operations Howard Donaldson, art director Daryl Anselmo and technical director Jorge Freitas.

While at Electronic Arts, Holmes, 31, led the development teams on the top-selling Def Jam and NBA Street franchises. Donaldson, 52, was EA Canada's chief financial officer for seven years and before that worked with Disney Interactive.

Seeking a "strong strategic partner" to meet the challenges of a new generation of gaming platforms expected to hit the market over the next two years, the group approached Disney subsidiary Buena Vista Games, which was known to be seeking a greater presence in the fast-growing electronic game market, Holmes said. To date, Buena Vista has largely licensed or contracted out the development of games based on Disney franchises to other publishers and independent developers.

The new studio, which has an action title in pre-production, is aimed at developing original and Buena Vista-owned content for the fast-growing adult gaming market. It will operate as a wholly owned subsidiary of Buena Vista.

"We're equivalent in games to the Miramax movie studio," Holmes said, referring to Disney's art-house film division for grown-up audiences.

In addition to the Vancouver startup, Buena Vista is buying Avalanche Software LC, a developer in Salt Lake City with more than 100 employees, the company said Tuesday. Avalanche creates its own titles such as Tak and the Power of Juju and Dragonball Z Sagas, as well as branded games such as Chicken Little, based on Disney's animated feature film premiering in November.

The two deals reflect a new strategy by Disney to take a leading role in the fastest-growing segment of the entertainment sector.

The world's largest entertainment company, Disney remains a bit player in video games. Buena Vista Games had sales of $265 million US in fiscal 2004, compared to $3 billion US for industry leader Electronic Arts. Nonetheless, it has a powerful distribution network and a vast library of content begging for adaptation into the interactive medium.

For years it has been linked to possible acquisitions of publishers such as Activision Inc. and THQ Inc., but has been deterred by prohibitive market values for these companies. In recent months, Disney switched its search to developers and/or growing its own gaming capacity from scratch.

The Vancouver start-up was attractive in that it came with a team that already had a "great track record" working together, said Buena Vista Games senior vice-president and general manager Graham Hopper. The company also wanted a presence in Vancouver, which has one of the industry's largest and deepest talent pools, he said.


Moreover the Vancouver group's proposal fit well with Buena Vista's strategy to expand out of its niche in children's games to become a major player in the "core gamer" market.

The industry is awaiting the arrival of new, more powerful gaming systems from Sony and Microsoft, and such "platform changeovers" are usually accompanied by a shakeout among the top 10 software publishers, Hopper said. When the next generation of hardware becomes established, Buena Vista intends to be one of the leading publishers.

Hopper would not give details of Buena Vista's investment in the Vancouver studio, but confirmed that "money will be changing hands" to reward the management team and that the company would be investing "many millions of dollars" in the operation over time. Sounding more bullish than Holmes, he predicted it would have as many as 100 employees by the end of this year.

"We don't have a top end on its growth," Hopper said.

Donaldson said the founders for their part made a five-year commitment to creating a top-level studio.

Holmes said the studio will hire experienced people from other companies to start with, but eventually bring up its own talent fresh out of school. It will also focus on putting out its first game, with a 60- to 80-member development team, before taking on other projects.

"We feel like that's our best way to succeed... to come out with a strong, hit title as our debut in the industry," he said.

- - -

CLASH OF THE TITANS

Disney's Buena Vista Games' move into Vancouver and Vivendi Universal recent purchase of Radical Entertainment means that three of the world's biggest entertainment companies are going head-to-head in our market. Here's how they compare:

Electronic Arts

$15.6 billion market cap

4,800 employees

Vivendi Universal

$32.3 billion market cap

49,617 employees

Walt Disney Co.

$55.6 billion market cap

129,000 employees

The Disney way: A 9-5 workday

Michael McCullough, with file from Marke Andrews
Vancouver Sun

Wednesday, April 20, 2005

Behind the entry of the world's largest entertainment company into Vancouver's already burgeoning video game industry is an ever-intensifying struggle for talent. And The Walt Disney Company's new studio here is trying a novel approach to differentiate itself -- as a normal, nine-to-five workplace.

"There's a great deal of talent here to draw from," said Josh Holmes, vice-president and general manager of the so far unnamed studio owned by Disney's Buena Vista Games. "I'm sure Disney recognized that."

A study by New Media B.C. a year ago counted 2,400 people working in the electronic gaming sector locally, and by some estimates the workforce has since grown to 3,000. That makes Vancouver one of the largest game development hubs in the world.

It has not gone unnoticed by game publishers, the giants of the gaming world that have recently been staking out their turf among the content creators. Last month Vivendi Universal bought Radical Entertainment, the city's No. 2 development studio. A year ago THQ Inc. bought Relic Entertainment. In 2002 Electronic Arts Inc., which already operated the world's largest single gaming studio in Burnaby, bought downtown Vancouver-based Black Box Games.

Though Disney opted to go with a start-up here, location was definitely a factor.

"We want a presence in Vancouver and we want to grow that presence," confirmed Buena Vista Games senior vice-president and general manager Graham Hopper.

One way the new firm plans to lure employees away from other companies is the promise of the normal working hours -- until now a rarity in an industry known for crushing deadlines and cots in the lunchroom.

"One of the things we're committed to as a studio is the concept of work/life balance," Holmes said. "We're forcused on having a core work day of eight hours, have people come into the office, get their work done, and get out and live their life. We don't work on weekends here."

Hopper said the management group's vision matched Disney's philosophy.

"Our company has been very successful over a long time by creating the right environment for creative people," he said.

Gaming is a young industry used to young people's hours and work habits, he said, but that is changing.

"Younger people grow up. They have families. At some point they need to have lives," Hopper said.

© The Vancouver Sun 2005

awesome news.


my ideal dream is to make the Vancouver-Kelowna corridor another Silicon Valley.

Thanks for the post. I used to work at the Electronic Arts Burnaby studio and am familiar with those guys and briefly worked with Josh years ago.

One way the new firm plans to lure employees away from other companies is the promise of the normal working hours -- until now a rarity in an industry known for crushing deadlines and cots in the lunchroom.

"One of the things we're committed to as a studio is the concept of work/life balance," Holmes said. "We're forcused on having a core work day of eight hours, have people come into the office, get their work done, and get out and live their life. We don't work on weekends here."

Hopper said the management group's vision matched Disney's philosophy.

"Our company has been very successful over a long time by creating the right environment for creative people," he said.

Gaming is a young industry used to young people's hours and work habits, he said, but that is changing.

"Younger people grow up. They have families. At some point they need to have lives," Hopper said.This is a very good idea. I wish EA thought of this when I was there. :lol: Anyway, that part of my life is done. I'm now going into the Trades. :happy:

awesome news.


my ideal dream is to make the Vancouver-Kelowna corridor another Silicon Valley.


that would be SO cool!

and it seems that disney really likes BC eh?

that would be SO cool!

and it seems that disney really likes BC eh?


High-Tech Industry British Columbia RE-BORN! :cheers:

awesome news.


my ideal dream is to make the Vancouver-Kelowna corridor another Silicon Valley.


uuuuuuuh let's first get some DENSITY along that corridor. Then we can talk about seting up huge companies there ;)

if you build it, they will come...sometimes...

uuuuuuuh let's first get some DENSITY along that corridor. Then we can talk about seting up huge companies there ;)


"If you build it, they will come." - Jarrod


Exactly. Take a look at Alberta for example and all the offices that moved there in the last decade and take a look at all that immigration into the province.