Large game developers and publishers are too averse to risk. Independent game developers are lacking in resources and money. These two factors are preventing the medium of gaming from reaching it's true potential, according to Ron Carmel—one half of World of Goo developer 2D Boy and co-founder of the Indie Fund—who spoke on the subject during the 2010 edition of the Montreal International Game Summit. His solution? The creation of medium-sized studios that have the resources of a larger company but the autonomy of an indie.

Ars had the chance to catch up with Carmel after his talk to discuss what needs to happen for a studio like this to exist and whether or not it's already happening.

According to Carmel, in addition to being relatively small and having adequate funding, the proposed studio would also need to work in an environment where profitability isn't a concern. And the easiest way to do this may be from within a larger publisher. "It shouldn't be that difficult to take a few million dollars to fund a team of 10 working on something forward-thinking," he said during the keynote. And this may be the biggest challenge of all, as big game companies are notoriously averse to risk, and focused on profitability.

"Why put money into a project that is not likely to do well commercially when you can put it into projects that you know will?" Carmel told Ars. "Also, even if money weren't a consideration, try justifying having your top talent working on ambitious artsy projects when you need them to make sure your golden goose lays its egg in time for [Christmas]."

Instead, the solution may be for companies to look outside for inspiration.

"I think it would be difficult for a large studio or publisher to take their most visionary designers and put them on a not-for-profit project," he told Ars. "It might be a better idea to build that team from the outside. Perhaps by taking submissions, specifically for creatively ambitious and forward-thinking projects, and then dole out the money as a grant to a team that would come work on them in-house. Maybe this is a good recruitment tool, as well?"

In some ways this is already happening. Some of the most critically acclaimed games of our time have come from Team Ico—the studio behind Ico, Shadow of the Colossus, and the upcoming The Last Guardian—and ThatGameCompany—the team behind Flower and the upcoming Journey—both of which are funded by Sony. Yet they're both relatively small teams and they've been given the freedom to craft unique experiences, with incredible results.

"As infuriating as Sony is as a bureaucracy, I really have to give them credit for their longer term vision when it comes to art house games," Carmel explained. "It's probably a way of thinking that was adopted from their film division. Sony Pictures Classic is a perfect example of balancing the nurturing of creativity with commercial endeavors. I don't think the great works of video games will ever be as profitable as the blockbuster titles, but I do think the audience is there to make them financially worthwhile when they finally start arriving. When that happens, I suspect things will look similar to the way they do in film. Lots of large production/distribution companies have art house divisions or subsidiaries."

During his keynote, Carmel compared his proposed studio to the teams that create concept cars. Large auto manufacturers create small, well-funded groups, and task them with creating something new and forward-thinking. And even if these concepts never make to production, they still serve as both a breeding ground for new ideas and a unique marketing tool. But in the often secretive world of game development, these types of projects are rarely glimpsed by the public, and if they are it's usually after they're cancelled, such as in the case of Steven Spielberg and EA's ill-fated LMNO project. But Carmel thinks this should change.

"The value of showing them is to expand our thinking and create new kinds of experiences," he told Ars. "I'd hate for amazing new things to be developed in a secret lab and for the public only to see a commercially viable reduction of a high concept. The only reason I would see not to share them in public is a misguided notion that if it's good, someone will steal it. That has certainly happened before. Crayon Physics, for example, is a 'eureka!' kind of game. A brilliant idea that is easily reproduced. But the strength of great works is not in their idea or premise, it's in their execution.

"The Mona Lisa isn't great because it's a great idea, and neither is The Wire, or Macbeth, or any great musical piece or painting or film."