During the past days I was among others in the Dutch city of Utrecht to attend the Nederlandse Gamedagen (Dutch Gaming Days), a two-day conference about gaming. Although most of what was discussed there is not relevant for this blog, I noted a few things that I would like to mention. One of the themes that was discussed during the conference was internationalization, something that really interests me. But the panel discussion was not what I expected from it.

Two Dutch game developers, a professor and two Americans that run a game studio in Holland, discussed the current and future trends of game development internationalization. These guys should be business people, but to me they sounded incredibly naive. Which countries do you think they see as a threat in terms of competition? Canada and France, not countries like China and India. And what should be done about that? The Dutch government should subsidize game developers so they can be more competitive… Come on guys, if you need subsidies you’d better close down your company and choose a different line of business.

China and India were mentioned, but they felt these countries are no threat. According to them companies there are not as creative, so they are no big danger. True, but things change incredibly fast. So don’t be fooled by believing this will stay like this. Furthermore, and this really made me laugh, they said that a 20-30% lower price in these countries would not be sufficient for game publishers to make their games there. First of all, 20-30% is a lot of money, and most business people would be very interested in finding a partner that can reduce their purchasing prices by this amount. But the fact is that prices in China are probably 50-60% lower than prices in Holland (and sometimes up to 80% lower – I know this from my own experience). There is no way Dutch game developers can survive in a price battle against China. Their argument that salaries in China are catching up fast is also totally wrong: of course salaries grow fast, but it will take decades to bring them at the same level.

If I look at Zlong Games (the company that was bought by Spill Group Asia a few months ago) for example, they produce at least the same quality products as the Dutch studios. But until now they were not very competitive in the international market. Because of cultural and language barriers, but also because they did not have the right contacts outside China. We put an experienced foreign sales manager in their company, and I am also helping them in their day-to-day business with foreign clients. The management of Zlong Games is very smart and learning incredibly fast, so they might not need me anymore one or two years from now. And that’s my goal of course, they should learn from us and then do it themselves. Their prices are much lower than what Dutch studios will ever be able to achieve, and they will stay much lower. And this is just one company (although a top one), I know many more that could achieve the same. Watch out Dutch game developers!