Exploring Game Development in South-East Asia

Introduction

After attending the 2005 Game Developers Conference in San Francisco, I found that there is a growing interest in the outsourcing work and even entire games to Asia. This interest could be attributed to higher development price tags for next-generation game development, cheaper communication/data transfer via the Internet, easier travel access, rapid economic growth, and a growing talent pool in Asia.

Outsourcing artwork to Asia is nothing new for the movie/TV industry, with a lot of the work already being done in places like Korea, Taiwan, and Shanghai. Larger game companies such as Ubisoft and Electronic Arts have recognized this trend and taken the first steps by opening game studios or publishing partnerships in China.

However, instead of talking about the whole of Asia, I will be focusing only on South-East Asia, leaving aside over-discussed areas such as Japan, South Korea, and China. Having spent over 5 years there setting up two studios, I felt the region has reached a point of maturity in game development that an article highlighting some of the activity in the area would be useful. I will also concentrate on four particular countries (Singapore, Malaysia, Thailand, and the Philippines) in the region, since most of the notable activity in game developing is happening in these countries, and these are the areas I particularly know. These four countries are so diverse both culturally and language-wise that bundling all of them together would not be informatively fair so I also decided to devote a section to each.

For each country, I will be covering specific pieces of information including some of the game development companies in the country, what types of products these companies are developing, the colleges that are providing game development specific coursework, and what incentives the governments in these countries are providing. I will then proceed to provide an overall cost comparison and gauge skill-sets available.

Sout-East Asia is a collection of countries that, except Thailand, were once colonies of various world powers. Its strategic location as a trading route and the need to militarily balance China 's "Communist threat" in the past has made it a center for economic growth for many years. South-East Asia has quickly moved its industry from agriculture to manufacturing, taking only 20-odd years. South-East Asia's largest trading partner is the U.S., with between 10-20% of its goods being exported. Many countries in South-East Asia now realize the need to shift their economies from a manufacturing base to a more service-oriented industry, and have begun governmental programs to stimulate that transition.

Malaysia

As an ex-British colony, Malaysia has inherited both its educational, political and judicial systems. Formed as a federation of states that originally included Singapore, the biggest advantage for both these countries is that English is the primary language used in many lower, college and graduate levels schools.

There are about 10 small to medium-size game companies focusing on development on the PlayStation 2, PC, Game Boy, and mobile platforms. GameBrains (www.gamebrains.com) has developed several products for the Game Boy and Game Boy Advance and is currently finalizing development of their PlayStation 2 game Mage Masters. Phoenix Game Studios (www.phoenix-gamestudios.com) develops games for the Xbox and online games for the PC. PGS has released an MMO called Storm Riders Online, which is currently available via subscription in both the U.S./Europe and SE Asia .

The largest mobile game companies are Unreal Mind (www.unrealmind.com), Tantalus Asia (www.tantalus.com.au), and 5th Cell Media (www.5thCell.com). Most of these companies focus on developing outsourced projects for U.S./Europe. Some companies also develop for America Idol type programs that use Short Message Service (SMS) for voting.

Several educational institutes also offer game development specific coursework and degrees. The Multimedia University (www.mmu.edu.my) has a game development program focusing on game technology and design. The program is quite technical in nature, having originally started as an offshoot of its computer science department. The course for the Multimedia University is going on its seventh year and has always sought direct involvement of the local game companies. The Games Showcase is an event held by the University which is open to the public, and where local commercial game developers will judge projects created by the students.

Lim Kok Wing (www.limkokwing.edu.my) has recently started a diploma in the creation of game art. This creative arts college is leveraging off its current courses in 3D animation, multimedia design with some new game design/development classes to create a game-specific syllabus. The instructors conducting these courses are ex-professional developers who have several titles under their belt and have already laid out a fairly comprehensive academic plan. The One Academy (www.toa.edu.my), which already has a reputation for graduating high qualified commercial artists often employed in the region's advertising agencies are now addressing game concept art, emphasizing art styles, characters and environment concepts.

The Malaysian Government has set up an organization called the Multimedia Development Corporation (www.mdc.com.my) to stimulate the growth of a larger information communication technology sector. The MDC has provided a bill of guarantees to approved companies (these are called "Multimedia Super Corridor Status Companies") that provide such benefits as unrestricted employment of foreign workers, no income taxes for 10 years, and ability to have 100% foreign ownership. MDC has also in the past made available grants to MSC status game companies to develop technology like game engines, as long as these engines are commercially utilized in the company's products. MDC has often played the role of a neutral body to bring education and industries together, as well as match-making partners.

Thailand

Thailand is the only South-East Asia nation that has never been colonized. It has kept is sovereignty via the deft maneuverings of King Mongkut (made famous by the play Yul Brynner in The King and I), who played the colonial powers against each other during the 18th century. Better known today as a tourist destination, it is a country with a great depth in culture, heritage, creativity and artistry.

There are roughly 10 to 15 game companies in Thailand. The two biggest companies are Cyberplanet (www.cyberplant-i.com) and Chiang Mai Digital Works (www.cmdworks.com). Thailand is in a unique position, in that its language creates the ability to have a strong local demand for domestic products. Original games sell well in Thailand once they are translated into Thai before being sold. Most of the products from these companies that are being developed are edutainment products on the PC or mobile games.

The Assumption University (www.au.edu) currently conducts a video game course in English. Most other universities that offer computing coursework in Thailand frequently embark on projects to develop games on the mobile platform.

The Thai government is very interested in foreign investments in the IT sector, giving the ability to easily get visas, work permits, tax exemption and allowing for 100% foreign ownerships. A proposal is currently in place by the Ministry of ICT to setup a "Thai Game Cluster" that could possibly give funding for game development ventures that want to set up in Thailand .

The Philippines

The Philippines is an ex-colony previously under two foreign powers (Spain and later the U.S.) that had significant impact on it culturally and economically. Although English is not the primary spoken language, it is actively used because it used extensively in schools. Although the country has gone through several years of political instability, the government is working hard to bridge the poverty gap (70% of people are in the lower income bracket) and build a stronger middle class. The challenge facing them and many other countries in South-East Asia is that some of the more talented individuals have migrated where their skills can be used more meaningfully.

There are currently about 5 game companies here, with some of the previous development focus being on the PC platform. But recently, many companies have been moving to develop more mobile titles. Companies like Esoft Interactive (www.esoftinteractive.com) have already done an array of PDA puzzle-oriented games, so moving to the mobile titles makes a lot of sense for them. Other companies that have finished PC titles such as Anino Entertainment (www.aninoentertainment.com) are moving into the mobile games as well, because of the shorter development cycles and faster cash turnaround.

The Philippines are already well known in the region for their 2D animation skills, having developed more than a couple local and foreign animated series. The Animation Council of Philippines (www.animationcouncil.org) is a non-profit organization whose members specialize in 2D/3D animation, and is a good starting reference to find companies that work can be outsourced too.

On the education front, several schools have started game development courses, including De La Salle University Manila, Ateneo de Manila University, and the College of St. Benilde. Other schools are planning short courses or full 4-year game development courses. Students from the College of St. Benilde and Ateneo de Naga often win top spots in animation contests held by the Animation Council. The IGDA Manila Chapter is very active in promoting the game industry, and a visit to their forums is highly recommended. In addition, an interesting new game competition for game companies and college students called UGOTGAME (www.ugotgame.net)

Owing to its close ties to the U.S., doing business in the Philippines is fairly easy. The government currently offers a tax holiday and duty-free importing of capital equipment.

Singapore

Singapore, having split from Malaysia about 35 years ago, has worked aggressively to become a premier trading port and manufacturing powerhouse. In order to compete more effectively with neighbors that are richer in natural resources, Singapore has created the ideal environment, both financially and living-wise, for foreigners looking to do business here. Singapore has now set its sights on becoming a leading new media developer/provider.

International game companies like Koei and Genki both have opened studios in Singapore, testament to the Singapore government's active stance in promoting game development in the region. Singapore has aggressively targeted some of these companies by providing staff to these firms in Japan, partially subsidized by the Singaporean government, in order to transfer skill sets to locals.

Local companies in Singapore are mainly focused on mobile development, with companies like Mikoishi (www.mikoishi.com) and NextGen (www.nexgenstudio.com) being the largest. There are several PC development companies, but those with products shipped include Envisage Reality (www.envisagereality.com) and Inerworx (www.inerworx.com).

Nanyang Polytechnic (www.nyp.edu.sg) offers a Diploma in Game Design, as well as having coursework in digital animation. Several games created by the game design development team have been marketed to Taiwan, Korea, China, and Japan. Nanyang Technical University (www.ntu.edu.sg) has set up a Game Lab, and offers final year electives in game programming.

The government of Singapore is represented by 3 government bodies, all promoting game development. The Media Development Authority (www.mda.gov.sg) is responsible for the various initiatives, developments and standards for television, film, video, radio, publication and new media. MDA has been very successful in the promoting the creation of home-grown movies and TV serials.

The Infocomm Development Authority (www.ida.gov.sg) is responsible for developing, promoting and regulating info-communications in Singapore . iDA will guarantee high-bandwidth inter-connections and world class data-center in its bid to become the infocomm hub in Asia. One of the reasons why Korea has been so successful, creating a booming online games industry, is because of its excellent network services and Singapore plans to follow suit by providing similar bandwidth.

Finally, the Economic Development Board (www.sedb.gov.sg) is the powerhouse organization that targets strategic directions that will have the most benefits for Singapore. To achieve such goals, they are able to provide aggressive incentives and also be able to match it with funding. EDB was instrumental in convincing LucasFilm to set up a studio in Singapore.

To encourage game development, EDB has initiated the Game Creation Community, which fosters local talent by assisting in the 4 areas of creation, production, financing and distribution. Local companies will get a chance to get pitching sessions with publishers and venture capitalists for their products. This event is held quarterly in conjunction with Nanyang Polytechnic.

Skills

Overall, the levels of skills in SE Asia for game development are pretty good for junior to mid-level positions. Skills for leadership position such as art directors, technical leads are harder to find and sometimes a company may have to hire "out of industry".

The technical skills sets in Asia are fair, with a large number of computer/electrical engineers coming from both local and international colleges (Many South-East Asian families send their children overseas to the U.S., UK, or Australia). In Malaysia, there are specialist programmers who have developed commercial quality game engines, with some of them working on their 3rd commercial iteration. Finding these engineers is difficult though regular channels, however, unless you are keyed into to the closely-knit local industry. Many of these engineers quickly find higher paying jobs overseas and locally after graduation.

Producers with experience in game development are extremely hard to find, especially those that have dealt with international publishers. Project management staff from other industries can be recruited, but may not understand enough of the games development lifecycle to be effective immediately. The closest industry where some of these qualities can be found is the advertising industry, but the fact that most advertising jobs rarely last more than 3 months would mean that the recruited individual would have to do a lot of thinking on their feet.

Artists are fairly abundant for junior to mid-level positions, with most having worked on both 2D and 3D work. Some artists do have to be retrained to appreciate game specific nuisances such as low poly modeling or use of game tools. A few educational facilities have already started making sure that graduating students do have the game related skills by including extra classes on the game assets. The position of art director is even harder to fill, and recruitment for the positions will mostly likely be an expatriate.

South-East Asia's weakest areas seem to be in the availability of good game designers. Most of the potential game designers come from paper-based role playing backgrounds. Paper-based gaming has been around a long time, especially in more English speaking places like Malaysia and Singapore. A weekly column in the local paper often provides reviews of board and card games. The availability of junior designers has been on the rise though, once again because of education initiatives. One key type of designers lacking in SE Asia are good level designers, with only a handful of people even developing any "mods" for any of the famous first-person shooters.

Development Costs

One of the key attractions in doing business in South-East Asia is the significant lower cost of development; in some extreme cases projects can be 1/8 th the cost of similar products developed in the U.S. The longer the development period, obviously, the larger the saving in cost would be, because staff salaries represent the biggest overhead in any game development company.

The only key factor that limits higher end development projects, though, is that the complexity of the work requires skills that are harder to find in SE Asia. The impetus of many of the game companies and governments in the region is towards these higher-end projects, making it only a matter of time when these skill-sets will become more common.

For an established game studio which has a track record of developing quality products and wants to set up in these countries, there are several advantages. The first advantage is that a smaller advance can be taken on the product to be developed, thereby decreasing the amount of time that for royalty checks from product sales can be collected. The second advantage is that same amount of money can be used to make a product of better quality by possibly putting more polish on the product, providing more content and better graphics. Lastly, for products that take a large team to develop, it can be done more cost effectively purely because of lower cumulative salary costs.

Challenges

Local studios have a big challenge in getting their product to market. Due to piracy and market size, the local marketplace cannot support development cost for large products. Most of the region's developers are now focusing on products with lower staff overheads and faster development cycles such as mobile games.

If local studios want to develop products for international marketplaces, the distance from the publishers also pose a huge problem in getting their foot in the door. The games industry requires constant networking and pitching in order to get a product published. A "Catch 22" situation is present for AAA type products, where high quality products developed by very experienced teams with multiple titles under their belts have raised the bar of publishers' expectations. Local developers have little or no experience in AAA game development, and have to struggle with how get the experience needed to develop these games without having worked on one.

A way out of this tricky dilemma, though, is for local studios to try to build these skills purely by doing outsourced development, while trying to partner with a more established foreign development company who may be able pass these skills to them. So long as the companies can break even financially, build a good reputation for quality products shipped on time, retain staff and work on game engines/prototypes on the side then the company may be in position to work on AAA titles. Korean publishers are another way to go, as they are closer, and networking there could be an avenue to being published elsewhere.

Foreign companies wanting to take advantage of the lower costs of development also have several obstacles to overcome. Finding the proper partners in the region is one of them. Each country has different nuances, both in dealing with local governments and hired staff. The fastest way to 'acclimatize' one-self to these regions is to partner with local people who understand these all these quirks. Companies will also have to deal with the time-zone differences, often making crucial communications with the publishers that much harder.

Initially, finding a partner may be through outsourcing work to a company there. First contact can be made by contacting the relevant government organization or non-profit company associations. Many of these organizations can be extremely helpful in providing information on potential partners, assistance and incentives for relocating.

Conclusion

Comparatively, the cost of developing games is tied to the standard of living in these countries. Singapore, the most developed of all South-East Asian nations tops the list for development costs, but also has skilled personnel and a friendly business environment. Malaysia and Thailand would rank second, with Philippines being the cheapest purely because of its currency.

In terms of skill-sets, Malaysia and Singapore are fairly even at this time. Both countries have aggressive governmental programs for game developers, and educational facilities that are training graduates specifically for game development. Malaysia perhaps benefits from its larger population in graduating more skilled professionals, but Singapore, with its program of "partnering" with foreign game firms may edge out Malaysia soon in terms of quality.

South-East Asia shows a great potential for game development, but still stands in the shadow of the huge explosion in foreign companies exploring China. Yet with South-East Asia's close proximity to China, it is in an intriguing location for foreign companies wanting to set up shop. Countries like Singapore and Malaysia, with their melting pot of Chinese, Malay, and India cultures provides a stable launch pad to all the "hot'"developing nations such as China, Indonesia, and India.

Thanks to

Ranulf Goss - IGDA Manila chapter coordinator
Constance Soh - EDB Singapore
Hasnul Samsudin - MDC Malaysia
Hilmy Abdul Rahim - Multimedia University (http://fit.mmu.edu.my/academic/aca-seg-3y.html)
Yan Marchal - Sanuk Software(www.sanuk.biz)