fbpx
Features

What 2024 could signify for the Canadian gaming industry

The head of the Entertainment Software Association of Canada on Canadian developer recognition, layoffs and more

Star Wars Outlaws

2023 was a wildly unpredictable year for games, to say the least.

On the one hand, there was an almost unprecedented number of critically-acclaimed games, including juggernauts like Baldur’s Gate 3 and The Legend of Zelda: Tears of the Kingdom and indie gems like Canadian-made Sea of Stars and Venba. But on the other, more than 5,000 people lost their jobs at the likes of PlayStation, Xbox, Epic Games and Canadian studios like BioWare Edmonton (Mass Effect) and London, Ontario’s Digital Extremes (Warframe).

Therefore, there’s a lot of uncertainty surrounding how 2024 will play out, especially with what looks to be a comparatively quieter calendar year. To get a better idea of what to expect for the rest of the year, we caught up with Jayson Hilchie, the president and CEO of the Entertainment Association of Canada, the lobbying group that represents Canada’s video game industry.

While chatting about the company’s new data on Canada’s best-selling games of 2023, we also asked him to look ahead to 2024 — both what he anticipates (and hopes) to see. Here are some takeaways.

Layoffs

We’d be remiss not to open this without acknowledging the elephant in the room. While more than 10,000 developers were laid off last year, we’ve already had 5,000 job cuts in January alone. The most notable of these was Microsoft; after closing its acquisition of Activision Blizzard last year, the company cut 1,900 jobs across all of its divisions, including Quebec City-based Beenox. Other gaming companies that have laid off staff this year include Twitch, Discord, Unity, League of Legends maker Riot and Marvel’s Guardians of the Galaxy developer Eidos Montreal.

Naturally, this has led to a great deal of upset across the industry, from developers losing morale and pushing for unionization to media calling for more accountability from the publishers. While Hilchie says he’s sympathetic to the affected developers, he explains that it’s the result of gaming’s rapid growth amid the pandemic. During this time, companies ramped up hiring and spent more money on games to meet the increased demand for at-home entertainment.

“There is a large rationale for why this is happening that goes beyond the Twitter space where it’s easy to slam a company or an industry for laying people off. But the overall economic environment — nobody saw this coming when they were hiring in 2020, 2021. I’ve seen some comments in the media — not just in the video game industry, but in other industries — where people have called hiring irresponsible. I disagree with that,” he says.

“I push back on that in the sense that no company in any industry is going to forego increased demand and not go after it. But also, if our industry didn’t hire during the pandemic when consumers wanted new games, better community management and better customer service, so on and so forth, there would have been a lot of complaints about the fact that people want these things and the industry is not keeping up with it. It’s a challenging situation. It’s easy to look back at the last couple of years, but I just want to ensure that the discussion around layoffs is seen as it should be seen, which is a derivative of what is happening in the macroeconomic environment.”

He adds that current economic headwinds — like 10 percent inflation and five percent interest rate increases in Canada — have only made matters more difficult “across the board” in industries beyond gaming.

Going forward, though, he says his outlook on the gaming industry is “very optimistic” despite the current struggles.

“This will pass — it’s a moment in time. The industry will get strong. People will gravitate back to our video games. Innovations in our industry will drive new products and experiences and entertainment that people have come back to. Interest rates will go down, and people’s economic sentiment and consumer sentiment will change.”

More video game events in Canada?

One of the most significant news stories last year was the announcement of the cancellation of E3 by ESAC’s American equivalent, the Entertainment Software Association. While the writing had been on the wall for the show’s demise, it was still a big deal, given its status as a 20-plus-year staple of the industry. While Summer Game Fest from The Game Awards creator Geoff Keighley has taken the June window historically associated with E3, it’s still in its early days and, therefore, can’t yet be named a true successor.

Hilchie, for his part, doesn’t think anything will truly replace E3.

“I don’t speak for ESA or E3, but you have to assume that if the industry was not interested in continuing to own and operate a massive trade show that the interest in that style of doing things has waned. There are new ways to do things, whether it’s individually as companies, whether it’s online, whether it’s through media […] I don’t expect something else to kind of jump up and fill the void because it doesn’t make a lot of sense.”

E3 2019

Indeed, predominantly digital events like Nintendo Direct, PlayStation State of Play and the The Game Awards have all been well-received thanks to their ability to reach consumers directly. At the same time, though, Hilchie notes that some physical events remain popular, be it Europe’s Gamescom, Japan’s Tokyo Game Show, or the several PAX and Comic-Cons in the U.S.

The question is, then: will Canada ever get events like this, especially since there historically haven’t been any? According to Hilchie, there hasn’t been a demand, at least on the publisher side of the industry.

“We tried the launch of a show similar to E3 in Canada probably a decade ago. We had about half the board who were interested, the other half weren’t really for it at all,” he admits. “Nobody’s asking us to do this. The industry has changed as well so much […] I think that if we had members asking us to get them in front of consumers, we would be looking at ways to do things [like that].

That’s not to say Hilchie would be against anything of the sort — far from it. He even notes that one element of E3 that he particularly misses is ESAC’s Student Video Game Competition. In it, Canadian students could submit games for a chance to be flown to E3 to demo their work on the show floor and network with developers.

“We have to go back and totally reinvent that initiative because there will no longer be an E3. So what does the Student Video Game Competition look like for us going forward? How do we fill the void of E3? So that’s probably, for us, one of the bigger challenges that exist because we really do want to bring that Student Video Game Competition back.”

More Canadian recognition

A few weeks ago, I published a column calling for greater awareness and understanding of the Canadian gaming industry, which is the third largest of its kind in Canada. Part of the reason why I dedicated months and tens of thousands of words to a Star Wars: Knights of the Old Republic retrospective last year was because so many people don’t seem to know that it — or many other beloved games — were made here in Canada.

The response to my piece was lovely, to say the least, with hundreds of developers across LinkedIn, X (Twitter) and Threads liking, sharing and commenting on my posts to share their thanks. With that in mind, I asked Hilchie what he thinks about getting more people to appreciate the Canadian gaming industry.

“We need people to understand how big the video game industry is in Canada who have nothing to do with the video game industry. When you live in a town and you have General Motors or Ford and someone works there — when you say ‘I work at Ford,’ everybody knows what that means. No one bats an eye,” he says. “I grew up in a Michelin town, and so if you made Michelin tires, everyone just knew what that was. But even to this day, with 32,000-plus people contributing $5.5 billion to the Canadian economy — when you tell someone you work in the video game industry, they always still go, ‘Oh, really? That’s… interesting,’ but they don’t know what that means.”

He notes that even when he talks to people about his job in the Canadian gaming industry, he’ll often just say he works in “public affairs” because it’s easier.

“One of the things that I’d like to see is just the video game industry and working in the video game industry becoming much more normalized […] So how do we normalize the Canadian industry as the national champion it really is? It’s a massive industry here and we still have people who don’t understand that — the vast majority of people don’t get that.”

One way to help with that, of course, would come down to having increased visibility for game makers. While industries like film and television are much more upfront about the production processes, video game companies tend to be more secretive. From the Canadian perspective, I bring up a lovely documentary about Ubisoft Toronto and the making of Far Cry 6, the likes of which we rarely see in the gaming space.

In response, Hilchie notes that ESAC also made several similar behind-the-scenes videos with the likes of Ubisoft Toronto, Eidos Montreal (Marvel’s Guardians of the Galaxy) and Vancouver’s Kabam (Marvel Contest of Champions) a few years ago to “humanize the people who make games.” However, he says these kinds of videos are more for enthusiasts and we need to reach the average person.

“[Canadian Electric Playground creator] Victor Lucas has said this numerous times: we’re just not getting the respect on TV,” he says, noting that there are shows online but not on television for mainstream audiences. “So when you come home after school, you’re not seeing a show about video games. That used to be normal and the video game industry has kind of inversely outpaced the TV focus on our industry. We got a lot of focus in the ’90s when we weren’t that big and now we’re into 2024, we’re massive, and there’s like nothing. So how do we increase mainstream media exposure of our industry in the face of [us being] massive? I agree with Vic on that — it’s a little perplexing to me.”

He says he’d love to see a time when people could say “I work at Ubisoft, I work on Assassin’s Creed” and the average person would understand.

“But we’re not there,” he admits. “And it is still surprising to me, given how many people work in the industry, and also how ubiquitous video games have become, that we still have those types of responses. And I really think that until we get to that point where the average person understands the impact of the industry that we’re we’re going to have a depreciated level of respect across the country.”

Closing thoughts

To sum it all up, Hilchie says he’s looking forward to the coming months, even amid what he admits is a “tough economic environment” filled with mass layoffs.

“I want to see the new games come out. I want to see more Canadian games. I want to see a bigger release schedule. I want to see more games coming out of Canada, and I want to see them do really well,” he says. Some of the confirmed 2024 games coming out of Canada include Star Wars Outlaws (co-developed by Ubisoft Toronto), Edmonton-based Inflexion’s Nightingale, and Vancouver’s Extremely OK Games’ Earthblade.

“I think 2024 is going to be a challenging year, but I’m optimistic about all the things that can come out of Canada this year.”

This interview has been updated for language and clarity.

Image credit: Ubisoft

Related Articles

Comments