Game Studios Leaving Vancouver For Tax Credits

Source Article: Rockstar Games to close Vancouver Studio, move to Toronto

Rockstar Games, which employed 35 people, consolidated the award-winning Vancouver studio with operations in Toronto, Ontario for better tax credits. Parent company Take-Two Interactive Software, located in Toronto, offered all 35 employees work but only if they could relocate there. Activision closed its 20 year old Radical Entertainment studio in Vancouver and laid off 90 people. Earlier that year Ubisoft closed eliminating 100 jobs. Electronic Arts and Propaganda have also made significant workforce reductions in past years.

Dennis Chenard is the Director of industry relations at the Centre for Digital Media in Vancouver. He suggests that employment opportunities are substantial thanks to local independent game developers and of the demand for visual effect technicians in the television and film industry. He believes the main reason studios are leaving Vancouver are because of the PS3 and Xbox systems, which are at the “tail end of the current generation of consoles.” To meet tax credit qualifications, studios in other provinces would want to consolidate with their out of province studios.

A woman employed at Radical Entertainment states “When a company that’s been around for 20 years is shut down, it brings a lot of fear to the Vancouver landscape.” She believes the main reason for its closure is the gaming production’s shift to the indie model and lack of support. She says “We’re losing a lot of jobs to Eastern Canada because we don’t have a tax credit.” Quebec and Ontario have a 37.5 per cent tax credit from the government whereas Vancouver and British Columbia only receive 17 per cent.

Another man employed at Rockstar said “We’re the backbone of the whole gaming industry in Vancouver.” A spokesperson at Activision Publishing Inc. said Rockstar’s latest project “Prototype IP”, did not find a broad commercial audience. Rockstar plans to keep 15 to 20 people to continue working on existing projects, but the studio will no longer develop their own games.

Tired of watching game companies leaving Vancouver, video game veteran Matt Toner is making his bid for the NDP nomination in the provincial riding of Vancouver-False Creek. “It a call to action for the entire Vancouver innovation industry; it’s time for us to take action to keep our studios, jobs, and mojo intact,” is the campaign’s rallying cry. Toner says Rockstar employees “are not just being let go, they’re now being taken to Toronto.” Toner states BC doesn’t seem to recognize the long term trend. ”We’re talking hundreds and hundreds of jobs lost.”

Toner said a lack of investments coupled with an overabundance of red tape make it difficult to get started in BC, than in places like Silicon Valley or in Canada, Quebec and Ontario, which are growing at BC’s expense.

On his campaign web site, Toner writes: “Once these people leave, they really aren’t coming back… and it will take us years to regrow the industry. The end result is that Vancouver has become a very fragile innovation center: we can either try to reinforce it and begin moving upwards again or we can slide into a much more mediocre place.”

-Ryan Ross