Five Reasons Why Georgia is Ripe for a Gaming Explosion

top_mascots.gifWhat you don’t know about the video game industry just might surprise you. Generating revenues in excess of $10B in 2005, it has well eclipsed the $9B Hollywood film industry. What if I told you that the conditions were ripe for an explosion in this sector in Georgia?

I’m fresh off the yearly Thanksgiving eating binge, so bear with me as I attempt to string together a few cohesive words.

It isn’t just the revenues that are impressive. Consider the ever-expanding demographic. When most people think about “gamers”, they envision some 14 year old kid plopped on the sofa, eyes glazed over, and unable to tell you who the President of the United States is. That image couldn’t be further from the truth.

Born in the 60s, and growing up in the 70s, I still remember the day the local pizza parlor (yes, that’s what we called them back then) carted off the pinball machine in favor of the new Asteroids coin-op unit. My generation is nearly a decade older than the average gamer. Keep that in mind. The average gamer doesn’t remember phones with cords, and doesn’t remember not having electronic games within the home. But they are of a very mature age.

The line between Hollywood films and video games has also gotten significantly blurrier over the past decade. Whereas game publishers used to turn successful movies into video games, Hollywood now trolls the shelves at Wal-Mart for the latest hit games, all in an effort to bring them to the big screen.

Even academia is getting in on the action. Consider this 50 question examination that I managed to come across. This is from the University of Teesside’s (in the U.K.) School of Computing. The course is called “COM1006: The History of Games.” There are at least a dozen schools that have cropped up dedicated to pumping out graduates armed with the latest knowledge in 3D graphic design and game engine mechanics (examples: Fullsail and Guild Hall at SMU). Even the overly commercial DeVry is getting in on the action.

While the costs to produce a hit game can easily top $10M, a hit can generate a significant fortune. Take John Madden’s storied gaming classic, Madden Football. In 17+ years, EA Games has sold more than 53 million units. The recently released Madden ’07 topped 2 million units, earning EA Games a treasure chest worth over $100M in the first week alone. Microsoft’s Halo 2 earned $125M in the first 24 hours after it was released in 2004. While a $10M investment may sound like a lot to Georgia investors, I should point out that there are plenty of opportunities for lower-cost indie (independent) efforts, not to mention cheaper plays within the wireless gaming market.

Got your attention yet?

So, let’s turn the focus a little closer to home – Georgia. There are a number of reasons why I personally think that Georgia is primed to experience a veritable explosion in the gaming sector:

  1. Initial wave of startups are here
  2. Atlanta has a large creative/design community that is now gearing up for gaming
  3. Support infrastructure is beginning to appear
  4. Research centers are popping up
  5. Atlanta can capitalize on its position within the wireless/mobile space

Initial wave of startups, early players are here

The initial wave of gaming companies are now here. These range from gaming hosting providers to publishers and studios.

Game Hosting Networks

Mobile Game Studios

PC and Console Game Studios

Web Based Gaming

Motion Capture, Peripherals, and other Sundries

Game Music Studios

Computer Animation

Online Gambling

Internet Broadcasting

Fortune 1000 Companies with digital and interactive departments

Atlanta’s creative/design communities are gearing up for gaming

The recent expansion into Atlanta of the renowned SCAD (Savannah College of Art and Design.) This brings the creative piece to the equation. There is quite a bit of creative design talent floating around. SCAD also now offers a degree in Interactive Design and Game Development. Coincidence? I think not.

Oh, and don’t forget the Art Institute of Atlanta. This venerable institution now also offers a degree in Game Art & Design.

Moreover, Atlanta has long been a hub for the music and interactive media scene – there is a lot of crossover. We have the talent pool.

Support infrastructure is beginning to appear

Supporting infrastructure is beginning to appear. (Chris’ list, GA gaming assoc – or whatever it is called, etc.)

Research centers are popping up

Consider Georgia Tech’s Experimental Game Lab. Simply put, they explore the frontiers of gaming. In this interdisciplinary lab, computer scientists, designers and artists work together to push the boundaries of existing genres and create new genres of electronic games. Speaking of Georgia Tech, there is an interesting group of bloggers who have banded together to discuss, among other things, gaming (Grand Text Auto.)

The wireless connection (no pun intended)

Atlanta is at the forefront of the wireless/mobile revolution, and has been for a while. Cingular, one of the world’s largest mobile carriers is headquartered here, as are a plethora of mobile tech plays. Did I mention how hot wireless gaming is?

Sound good – so what’s missing?

The companies listed above are early adopters and pioneers within the local market. We need more Georgia entrepreneurs to take advantage of these trends locally to drive innovation.

On the flipside, we need investors to realize that there are other wealth-building opportunities that exist in Georgia outside of the manufacturing and telecommunications sectors. I would strongly encourage local investors to get involved in this space – before we see another influx of outside deal-makers arrive at Hartsfield International Airport with their checkbooks in hand.

2007 will be a breakout year for gaming – especially given Microsoft’s strategy for pushing the PC/Vista combo as a front-shelf retail game platform. It will be interesting to see how much push Georgia-based players can make in this space.

I welcome your comments below! Please note that if you are a first time commenter, your comment will need to be approved first before it will appear on the blog.

Special thanks to Chris Klaus of Kaneva for his assistance with this post. For those of you who are interested – stay tuned to The Pothole, as in the coming weeks, Chris Klaus will be joining Mike Blake and I for a podcast where we’ll discuss this very subject!

Cheers.

4 Comments

  1. Sorry for the repeated edits (which update the RSS feed’s timestamp.) I continue to add new links to interesting Georgia-based companies as I get them in email from people.

    Cheers.
    Scott

  2. Great read!! I am glad to see some focus finally being put on this industry here in GA. If I come across some other startups I’ll email them or post them here.

  3. First the start-up round up and now this! You have been quite busy.

    As I was making my way into the ATDC a good number of people thought that it should be an area in which we show a little more focus.

    I am going to get involved in some of the groups you mentioned.

    Would welcome the opportunity to sit down with any of the entrepreneurs of the gaming startups to learn more about what they are doing and how we could help them to succeed.

  4. ^^^^^

    There ya go folks. If you are a startup in the digital/gaming entertainment space in Georgia, give Lance a call down at the ATDC (www.atdc.org). Can’t beat an open invitation. :)

    Lance – thanks for stopping by and dropping a note!

    Cheers.
    Scott

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