Video game development is coming to be a larger investment, both in terms of dollars spent and the size of a given studio’s workforce. Longtime Electronic Arts chief creative officer Richard Hilleman ran some numbers, and he figures that the industry is down now to roughly 25 AAA development houses, from the 125 or so that were operating when the current-gen launched in the mid-Aughts. You might think that the studio reduction also diminished the size of the workforce, but that doesn’t seem to be the case.

“What’s interesting is that, if you look at the composition of those teams, the numbers are exactly the same: those 125 teams became 25,” Hilleman writes in a newly released whitepaper for D.I.C.E. Europe. In other words, say there were 5,000 developer-types spread out across 125 teams back in 2005; the same 5,000 people are still around now and working in much larger groups at one of the 25-ish AAA studios. Hilleman’s numbers are estimates of course, but he makes his point clearly enough.

“This has everything to do with the standard definition to HD change,” Hilleman writes. “If you look at the math, that change is about content – richly about content – and as we evolved, our costs went substantially up. And the number of people on teams with that kind of vision went up by necessity.”

Producing HD content simply requires more resources. You need more money, more time, and more people to make use of those resources in creative ways. Hilleman isn’t alone in making this observation. Nintendo’s Shigeru Miyamoto made a similar comment during a recent investor Q&A, revealing that HD game development for the new Wii U console “requires about twice the human resources [as it did] before.”

… the indie development community flourishes more now than it ever has before, and it’s only growing.

Think back for a moment to the Xbox 360 launch. The hardware was impressive, but the initial offering of games was lacking. For the first time, the people who build games were discovering that better textures and a wider range of visual effects equates to a need for more programmers. Nintendo’s early dominance with the original Wii also speaks to this; just look at how quickly the underpowered console was able to turn out games. Even though it had a shorter life span than the Xbox 360, it released nearly 300 more titles.

The environment is much different now. Major beloved studios like Pandemic, Vigil, 3D Realms, Black Rock, Team Bondi, GRIN, and all things Midway, along with so many others are gone, with many of their most recognizable franchises shelved. Even if Hilleman’s numbers aren’t 100-percent accurate, his analysis is dead-on: there are bigger teams working on a much smaller selection of games.

Really, what Hilleman is driving at is the death of the middle tier in games development. The safest plays in the industry are coming out of the bigger studios, while the big risks and innovative steps forward are, for the most part, coming from the indie scene. Many of the studios caught in between haven’t been able to sustain themselves, and the displaced workforces have been moving in one direction or the other.

There’s no place for middle-tier development in the current environment. Why would a publisher risk millions on a production that has only a remote chance of sparking the interest of the mainstream? Similarly, why would a thoughtful creator of games want to risk losing ownership of a simple-yet-innovative concept that might be shut down mid-development by a nervous publisher?

This isn’t a good or a bad thing; it’s just evolution. Bigger teams will continue to deliver the same, familiar concepts year after year, complete with iterative improvements that speak to growing comfort with the hardware. Meanwhile, the indie development community flourishes more now than it ever has before, and it’s only growing. This success in turn emboldens job-seeking programmers to cultivate ideas on their own that wouldn’t fly when there’s a more significant financial investment on the line.

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