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Video Games Worth More Than The Movie Industry

30 May 2002

Video Games Worth More Than The Movie Industry – Industry NZ promotes Kiwi game developers on centre stage at LA

Video game sales around the world are booming. In the US, video games are now worth more than the movie industry – sales there in 2000 were worth $6.2 billion in 2000 and grew 44 percent to $9.4 billion in 2001.

While the New Zealand video games industry is small on the world stage, there are several innovative developers at work. There are significant worldwide opportunities for our games developers, both in creating their own games - particularly in the area of console games (PlayStation2, GameCube and MS Xbox) - and in subcontracting with overseas developers. New Zealand offers good value for money, with skilled developers able to offer a cost-effective service.

Industry New Zealand is working with the local games industry to facilitate its development. Industry NZ has been the driving force behind the development of a New Zealand Game Developers Association so that New Zealand companies, tiny by world standards and distant from major markets, have a collective voice. It has also been instrumental in setting up the association’s website – - a potential showplace for New Zealand video games.

Industry NZ games sector analyst, Clare O’Leary, attended the huge E3 annual electronic entertainment expo held in Los Angeles on May 21. Accompanied by Mario Wynands, managing director of Sidhe Interactive - New Zealand’s largest games developer and president of the NZ Game Developers Association - she attended the conference held as part of E3.

“The conference is attended by leading video games developers, studios and publishers – it is the only event attended by all major publishers. We promoted New Zealand as a leading-edge development centre for video games,” she says.

As part of their luggage, Clare O’Leary and Mario Wynands took a large box of Industry NZ’s April issue of Venture magazine, which profiled the games developers and also new initiatives being taken within New Zealand’s wider information and communications technology (ICT) industry.

One of these is the establishment of an ICT Taskforce by the government in early May. Industry NZ has a key role is supporting this taskforce, which includes leading technology entrepreneurs and venture capitalists. The taskforce held its first meeting during the weekend of 25-26 May and is planning to report back to government by the end of July.

In April Liz Longworth, Industry NZ’s sector director for ICT, chaired a UNESCO forum in Paris on global internet policy that refined draft recommendations on promoting universal access and multilingualism in cyberspace. UNESCO sees the internet as a tool to promote international understanding and as an essential information conduit in a democracy. New Zealand’s development of its e-government portal is an example of the type of initiative UNESCO is trying to encourage.

Since September 11, e-security has become a number one concern in the ICT world. Industry NZ is conducting a scoping study of New Zealand companies producing products or services in this area, and alignment with international opportunities.

One of these companies, Christchurch company KeyGhost Limited, a subsidiary of Interface Security, has developed sophisticated data-capturing technology that has many applications in backup, monitoring, auditing and forensics. The technology behind KeyGhost is world-leading and sales are strong. The company has received Industry NZ enterprise award funding.

With the rapid growth of the importance of the internet to business, Industry NZ is working to improve access and operability of the internet. In addition to work being done with the Ministry of Economic Development to provide high-speed access in rural areas, an Industry NZ grant of $50,000 has recently been approved to allow a pilot study of second generation internet in New Zealand. “New Zealand was alone among OECD countries in not examining the possibilities of second generation internet, which has been seen to be crucial in the research and academic network,” says Industry NZ sector specialist John Houlker.

Research organisations and the high tech sector will be consulted about this pilot study to determine common interests. The film production companies Three Foot Six, WingNut Films and WetaDigital have for example recently interconnected with a gigabyte/second network link. Three Foot Six producer Barrie Osborne says affordable, high bandwidth international connectivity is key to long-range competitiveness and access to a wider market.

Industry NZ has also assisted an IT Health Cluster with several programmes including funding for a strategic planning exercise. The cluster, which is managed by Auckland UniServices Ltd, involves about 25 or more companies including software developers, consultants, district health boards, government agencies and universities. The intention is to develop a plan for collaboration in the health IT sector, with the aim of achieving around 50 percent compound growth over the next 10 years. The strategic plan is to be delivered to government at the end of May.


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