SWEDISH GAMES INDUSTRY REPORTS 2009 Game Developer Index 2008 Just Cause 2, Avalanche Studios

Sweden – one of the world’s important gaming nations

Welcome to the third edition of Game Developers Index, the Swedish games industry’s annual compilation of the Swedish game development companies’ financial statements.

The basis of this report is derived from the Trade and that the quality is also generally very high. 2008 was another Industry Register, which means that the data is reviewed by successful year for the Swedish computer games industry, the respective companies’ auditors and defined by the AGM. with continued strong growth both in terms of employment However, it also means there might be some delay discre- (+17%) and turnover (+21%). pancies as a company has seven months to submit its finan- The year, 2008 is synonymous with the global economic cial statements. The Game Developer Index is comprised crisis, which had an impact across various sectors, but an ini- entirely of corporations and does not include other types of tial lag before its effects hit game developers - hard. Exactly organizations such as partnerships and economic associa- what sort of impact this will have on the industry remains tions. The bulk of all commercial computer game develop- to be seen. However, it is clear that many new segments are ment organizations in Sweden are, however, of the limited growing strongly, such as mobile games, advertising games, liability company variety. Swedish-developed games are by online games, specialized contractors, etc. Overall, Swedish any standards an international . In terms of turnover game development is in pretty good shape. and employment, relative to population, Sweden is one of the world’s top five, maybe top three, major gaming nations. Per Strömbäck In a Nordic comparison, we have by far the most internatio- [email protected] nally established companies. In addition to the commercial Spokesperson, Swedish Games Industry successes, the compilation of reviews in this report shows

Swedish Games Industry Reports 2009 Game Developer Index 2008 | 2 Business Ratio

2008 2007 2006 Number of companies 104 (+14 %) 91 (+34 %) 68 Turnover 1 158 070 721 (+21 %) 958 977 633 (+49 %) 642 117 984 Turnover per employee 855 675 (+3 %) 831 486 (+5 %) 790 299 Results -188 807 573 (-1121 %) -15 462 761 (+33 %) -23 232 837 Number of employees 1353,4 (+17 %) 1153,33 (+42 %) 812,5 Comprising men 1217,7 (90 %) 1034,13 (90 %) 702,25 (85 %) Comprising women 135,7 (10 %) 119,2 (10 %) 107,25 (15 %)

Turnover and result in SEK

Size of industry players Number of employees In order, to provide a fair and accurate picture of the Swedish games industry, the 104 companies in the poll have been split into segments based on turnover and number of employees. 0-3 employees / 54 ea

A large proportion of the companies 4-10 employees / 28 ea engaged in some form of game deve- 11-20 employees / 9 ea lopment are relatively small companies 21-50 employees / 6 ea with a small number of employees < 50 employees / 6 ea - with more than half having no more than three employees. This could be attributed to an increase in start-ups, while fewer companies suffered insol- vency. The number of companies listed in the game developer index has also seen an increase from 91 in 2007 to 104 in this report. Turnover One can also see from the charts that employment is on the rise. In the seg- ment with 4-10 employees, this figure has risen from 24 last year to 28 as at the time of this report. Even the 21-50 employees segment has gone up. 0-1 000 000 / 45 ea Turnover for the more established 1 000 001-10 000 000 / 42 ea developers has also increased, with 10 000 001-30 000 000 / 9 ea nine of those in the 10-30 million 30 000 001-50 000 000 / 2 ea brackets, which is an increase from five < 50 000 000 / 6 ea companies last year. Six of the compa- nies also have a turnover exceeding 50 million against four from the previous year’s report.

Swedish Games Industry Reports 2009 Game Developer Index 2008 | 3 Number of employees Distribution by sex

1400 1200 1000 800 600 400 200 0 Men 2006 2007 2008 Women

Turnover Result 0 1 250 000 000 2006 2007 2008 -2o 000 000 1 000 000 000 -4o 000 000 -60 000 000 750 000 000 -80 000 000 -100 000 000 500 000 000 -120 000 000 250 000 000 -140 000 000 -160 000 000 0 -180 000 000 2006 2007 2008 -200 000 000

Turnover and result in SEK

Onwards and upwards for game development

The gaming industry registered conti- however combined figures reveal ne- Despite continued strong game nued growth in 2008 with normaliza- gative results. The five companies with sales, successful publishers have been tion expected in the coming years as the largest negative results accounted a lot more cautious with regards to fallout from the financial downturn for 92 percent of the total adverse unproven concepts, or new games begins to fade away. outcome. resulting in fewer assignments for A large proportion of the negative game developers. Meanwhile, new The number of those employed within result can be attributed to the addi- opportunities within mobile gaming, the industry has increased by 89 per- tion of 13 new companies to the survey games in the community and opened cent between 2005 and 2008. Turnover since last year (the real figure for new up digital distribution have created an has also increased by 115 percent over companies is higher since over the outlet for smaller studios to create a the same period. This explosive period same period, the company has either profitable niche. This means that game of development has slowed with the ceased trading or changed business di- developers can be successful with new global economic crisis. With this in rection). Newly established companies gaming ideas and concepts without mind and compared to more recent often have no income until the launch engaging in large and risky produc- years, growth is expected to slow down of their first game. Game development tions. The companies with the highest substantially, although it is still expec- is characterized by long gestation turnovers are expected to be those ted to maintain a relatively high level. periods with some running several with the largest personnel demanding The majority of the 104 companies in projects concurrently without receipts console development productions. the survey reported positive results; in anticipation of product launch.

Swedish Games Industry Reports 2009 Game Developer Index 2008 | 4 Map of Swedish Game Developers

Stockholm 21-0 Media Interactive Productline A Different Game Jadestone Active Media Group Liquid Media Avalanche Studios Lonely Duck Bajoum Mobile Interaction Content Garden Movinto Fun Curictus Paradox Interactive Luleå DDM Agents Pipistrello Velcro Interactive EA DICE Pixel Tales Electronic Sports Network PlayCom Umeå ePGA Play-DO Coldwood Extra Lives Polarbit ICE Game Studios Fabrication Games Raketspel Oryx Simulations Reachin Resolution Interactive Foolish Entertainment Semionetix Teknikhuset G5 Entertainment Silent Grove Two 58 Productions Game and Gain SoGamed International Game Installations Rinman Straycat Studios Östersund Gamefederation The Story Lab Prelusion Gatorhole Hidden Dinosaur Örebro Sundsvall Datacraft Game Studios Swedish E-Sport Association

Falun Skövde Megafront Colossai Studios Sim Bin Pieces Interactive Tension Sevenatus Tenstar Shortfuse Games Zimulus Sim Bin

Hedemora Vara Ruta Ett Sim Bin Uppsala Göteborg Aniware Auran Games Köping Doctor Entertainment Curictus LS Entertainment Game Hosting Develant Technologies Hansoft EPOS Strängnås Imagination Studios Illuminate Labs Funflower Solnaedition Image & Form International Starbreeze Legendo Entertainment Stillfront Mindark Eskilstuna Muskedunder Interactive Kobolt Media Sim Bin Nyköping Helsingborg Pin Interactive Malmö Localize Direct Illusions Labs Pixelbite Motala Norrköping Junebug Goes International Onetoofree Leripa Nordic Game Resources Ozma Växjö Linköping Donya Labs Pushplay Play n’ Go Power Challenge Redikod Southend Interactive Karlshamn Karlskrona Starvault Black Drop Studios GlobalFun Swedish Game Development Lund Custom Red Managerzone Massive Aescapia Tarsier Studios Power Challenge Upside Studios Monkfish Instruments Tullhuset Games Tic Tac Interactive Wanna Play Productions

Swedish Games Industry Reports 2009 Game Developer Index 2008 | 5 Swedish industry’s largest players Biggest companies - number of employees

A compilation of the Games Developer Index comprises of 104 1. EA DICE 248 companies. There is a degree of polarization against the larger companies. 2. 137 The five companies with the most employees account for 52.2 percent of employment within the industry. This chasm between the larger and 3. Avalanche Studios 131 smaller players within the industry is further highlighted when turnover 4. Ubisoft Massive 120 is taken into account, with the top five accounting for 64.2 per cent of the industry’s combined total turnover. 5. Jadestone 70 The number of employees as of today is based on a survey conducted no of employees August 2009.

Biggest companies - turnover Biggest companies - number of employees today

1. EA DICE 319 1. EA DICE 240 2. Grin 194 2. Ubisoft Massive 116 3. Avalanche Studios 95 3. Starbreeze 103 4. SimBin 69 4. Avalanche Studios 85 5. Mindark 67 5. Jadestone 54 millions SEK no of employees

Notices to Game Developer Index 2008

Note that data highlighted applies pany. There may also be games under Traders who submitted their first to registered Swedish companies. In development within companies that do annual report for fiscal year 2009: addition, there lacks some data on not have that as their primary activity. A Different Game, companies that develop games but are Computer games industry in Sweden is Doctor Entertainment, not registered limited liability compa- assumed to be larger than the figures in Fatshark, Illusions Labs, nies, such as partnerships or companies the report indicates. Localize Direct, Pixelbite, registered abroad. Several projects may Shortfuse Games and also be hobbies or projects of students Annual Report unavailable for: Straycat Studios who have not registered limited com- Auran Games

Export and education - to market and future-proof the industry

For Sweden to maintain its place as mes. A symbiotic approach by the indu- distinctive Nordic content for children one of the foremost game develo- stry to education has raised the quality and young people. ping countries, we have to train and level attained by graduates students. A The Nordic Game Program works to nurture talents that can make the step into a real world working environ- create structures for efficient distribu- next-generation of games. ment can be done through incubators, tion and localization for Nordic game such as Gothia Science Park and The developers. Export Efforts are made to There presently exists a number Teknikdalen Foundation, whose role is market the industry with attendances of post-secondary school forms of to merge knowledge-based ideas with at trade fairs and conferences. There is education that specifically focuses on growth potential. also the Nordic Game conference which computer games, such as: Polytechnics is held annually and attracts more than such as Playground Squad in Falun, Export efforts and local strength 1,000 delegates from around the world. The Game Assembly in Malmö and the The Nordic Game Program is a project Game Developers can apply for Future Games Academy in Stockholm that was launched in 2006 and is due development aid and support, for areas as well as colleges / universities such as to run till 2012. It was initiated by the such as the creation of new intellectual the University of Skövde. There are also Nordic Council of Ministers and its task properties and games for the Nordic other courses related to computer ga- is to secure games of high quality and a market.

Swedish Games Industry Reports 2009 Game Developer Index 2008 | 6 A selection of Swedish developed games

Games published 2008

Barbie Horse Adventures STCC The Game Mirror’s Edge Dirk Dagger Pixel Tales Sim Bin EA DICE Jadestone

Games published 2009

World in Conflict: Soviet Assault Hearts of Iron III Race Pro Ubisoft Massive Paradox Interactive Sim Bin EA DICE

Bionic Commando Riddick: Assault on Dark Athena R-Type Dimensions Terminator Salvation Grin Starbreeze Southend Interactive Grin

Swedish Games Industry Reports 2009 Game Developer Index 2008 | 7 Historical data

The Swedish games industry has a his- jump. Largely in part, to the arrival of people. DICE was the largest Swedish tory dating back to the 1980s, and to the venture capitalists that showed studio in 2005 with 150 employees. help us with a development timeline, great interest in investing in techno- Starbreeze and Synergenix also upped we have taken the help of Ulf Sand- logy. One example is the Slottbacken their numbers from 30 to 60 employ- qvist, PhD student at Umeå University. Venture Capital, which invested in ees. Unique Development Studios (UDS). Apart from 1995 when there were fe- Ulf Sandqvist is the brains behind the Between 2002-2003, the industry wit- wer people working in the industry, the study, Digital dreams - a study of the nessed a slump with a lot of companies percentage of women has remained Swedish computer and opting to cut down on their workforce. around the 7-10 percent mark, which is industry, 1980-2005. His approach is One of which was UDS, which went in line with the current figure of 10 per similar to the Game Developer Index, bankrupt in 2002 and had to lay off cent reported in this report. by which he derives his company data all of its 70 employees; even Idol FX Despite a steady increase in turnover, from the Swedish Companies Regist- and Oblivion Entertainment going overall results have been a lot more ration Office (SCRO), which makes it bankrupt. Despite this lull and decline unstable. This is because predicting the partially comparable. Most companies in the number of employees by 10 per- popularity of a game is difficult prior to start out as a pet project with a handful cent, net sales increased by 3 percent. its release. Collectively, the industry’s of individuals who start the company In 2004 and 2005, the number of in- annual results were negative, however, with designs to live off game develop- dustry employees again increased; with some companies such as Massive re- ment. The period between 1998 and Avalanche and Jadestone doubling gister a profit of over 10 million kronor 2001 could be described as a renais- their workforce to 60 and 45 employees and Dice fluctuates between 30 and 50 sance, with the number of firms within respectively and Massive Entertain- million kronor in profit. the industry experiencing a 100 percent ment increasing their workforce to 43

Number of employees Number of companies

Comprising women Turnover

Swedish Games Industry Reports 2009 Game Developer Index 2008 | 8 Swedish games with triple-A-quality

Over the years, a number of bestsel- game developers, whose titles achieve scores, which means some media lers and international hits have been a certain so-called Metascore, which is outlets have a higher influence on the developed in Sweden. Swedish games a form of weighted average scores. Me- metascore posted by . Listed are consistently of the highest quality. tacritic collects scores from a variety of below is a selection of Swedish games review media and publications across from 2000 onwards, with scores from The gaming industry uses Metacritic numerous countries. Unlike a traditio- Metacritic. as a barometer for measuring quality. nal average rating, Metacritic uses a It is common for bonuses to be paid to weighted approach for the collective

Title Developer Metascore Format Year Battlefield 1943 EA DICE 84 360 2009 Hearts of Iron 3 Paradox Interactive 81 PC 2009 R-Type: Dimensions Southend Interactive 77 2009 The Chronicles of Riddick: Assault on Dark Athena Starbreeze 82 Xbox 360 2009 The Hunter Avalanche Studios 77 PC 2009 Battlefield: Bad Company EA DICE 84 PS3 2008 : Rearmed Grin 87 PS3 2008 GTR Evolution SimBin 83 PC 2008 Mirror’s Edge EA DICE 79 PS3 2008 Europa Universalis 3 Paradox Interactive 83 PC 2007 Race 07 Official WTCC Game SimBin 83 PC 2007 The Darkness Starbreeze 82 Xbox 360 2007 World in Conflict Ubisoft Massive 89 PC 2007 EA DICE 80 PC 2006 GTR 2 FIA GT SimBin 90 PC 2006 Just Cause Avalanche Studios 75 PC 2006 Race: The WTCC Game SimBin 81 PC 2006 EA DICE 91 PC 2005 GTR FIA GT Racing Game SimBin 85 PC 2005 Hearts of Iron 2 Paradox Interactive 83 PC 2005 EA DICE 84 PC 2004 Ground Control 2 Ubisoft Massive 80 PC 2004 2 EA DICE 87 Xbox 2004 The Chronicles of Riddick: Escape from Butcher Bay Starbreeze 90 PC 2004 : Road to Rome EA DICE 84 PC 2003 Battlefield 1942 EA DICE 89 PC 2002 Deathrow Southend Interactive 79 Xbox 2002 Rallisport Challenge EA DICE 87 Xbox 2002 Europa Universalis 2 Paradox Interactive 87 PC 2001 Europa Universalis Paradox Interactive 86 PC 2001 Ground Control Ubisoft Massive 86 PC 2000

Metascore in this report have been fetched September the 1st 2009. For a complete list of current included media and a description of the process please visit http://www.metacritic.com.

Swedish Games Industry Reports 2009 Game Developer Index 2008 | 9

metacritic.com Number of studios in the Nordic Turnover

Denmark 70 Finland 87 Finland 45 Iceland 24 Iceland 2 Sweden 112 Norway 25 millions euros Sweden 104 Total Nordic 246 no of companies Number of employees in different regions

Nordic 3340 France 2500 Number of employees in the Nordic Germany 2900 Denmark 300 United Kingdom 9900 Finland 1147 Europa 22000 Iceland 240 Canada 9500 Norway 300 USA 44400 Sweden 1353 Japan 13000 Total Nordic 3340 Australia 1600 no of employees no of employees

International outlook

How is the Swedish industry percei- productions, the big five in Finland figures grew by 13 percent in 2008, with ved internationally? In order to get (Sulake, Sumeer / Digital Chocolate, both Canada and the U.S accounting a better understanding of this, we Game Lion, Apaja and Universomo / for almost 54,000 people in game de- compare Sweden to her neighbours THQ) work exclusively on mobile games velopment. The largest state in the U.S. and the Nordic region with other suc- or online based games. is California with 21,200 employed, fol- cessful regions. The Nordic region employs more lowed by Washington with 4700 people people than any other large European and Texas with 3300 people. Many international bestsellers have countries such as France and Germany, been created in Sweden, but with but remains well behind Great Britain. The figures are compiled by the Nordic foreign eyes, the Nordic region is as a whole has grown and Game Program, which collected data sometimes viewed as one so cluster employs more than Japan. North from reports such Active Game Com- within game development. In addition America, however, remains the largest panies in Denmark, Games Impact and to the Swedish success, our Nordic region for game development and in Raise the Game. Additional data was neighbours have also helped to direct terms of staff numbers is twice as big as derived from Neogames, Game Develo- the spotlight upon the region, thanks Europe. per Census and GDAA. to games like Max Payne by Remedy in In , employment Finland, Hitman created by the Danish company, IO Interactive, Age of Conan developed by Funcom of Norway and Icelandic Eve Online developed by CCP. In the Nordic countries, Sweden and Finland are the largest countries in terms of turnover and employment. While the largest companies in Sweden focus primarily on large-scale console

Swedish Games Industry Reports 2009 Game Developer Index 2008 | 10 , EA DICE

Dirt Moto Racing, Resolution The Hunter, Avalanche Studios

Pepsi Music Challenge, Muskedunder Interactive Colosseum, Shortfuse Games

Swedish Games Industry Reports 2009 Game Developer Index 2008 | 11 ABOUT SWEDISH GAMES INDUSTRY

Swedish Games Industry is a partnership between MDTS and Spelplan-ASGD. For additional information in English please visit www.swedishgamesindustry.com.

Martin Lindell Information Officer / Analyst Telephone +46(0)706 629496 [email protected]

Per Strömbäck Spokesperson Telephone +46(0)708 436 214 [email protected]

Vic Bassey English Editor Telephone +46(0)704 788889 [email protected]

Dataspelsbranschen Swedish Games Industry Klara norra kyrkog 31, Box 3139, SE-103 62 Stockholm www.dataspelsbranschen.se