Gaming

XDev report: 86 per cent concerned by impact of COVID-19 on worldwide game development


300 games professionals contributed to a new report to ascertain the impact to date of the coronavirus epidemic on games development. It showed that 86 per cent were moderately or very concerned about the impact upon their schedules and businesses, of which 14 per cent were very concerned, saying that “businesses and game franchises could potentially not recover.”

The report was commissioned by the external development body, the XDS Advisory Committee, and authored by its chair Chris Wren. Respondents were roughly divided between one-third publishers and developers, and two-thirds external development partners – who are key to the delivery of practically any sizeable title – see our recent piece on XDev for more on that.

Areas most impacted according to the report are fairly broad, with art, co-development, animation, motion capture and QA all suffering. It’s early days obviously, but 13 per cent said the impact had already affected game launches, while another 41 per cent didn’t yet know if their planned launches would be affected.

“I think we will lose roughly about 5 to 10 per cent of our business in the short run.”

One anonymous respondent, a service provider, told XDS: “I think we will lose roughly about 5 to 10 per cent of our business in the short run. The industry will bounce back hopefully when this is over in 2-3 months. There will be higher demand as the demand for content from players during the health crisis is higher. New console releases will be around the corner, though delayed. What’s more interesting is to understand what permanent changes will result at the end of this. Are there new measures and/or requirements of service providers for disaster recovery?”

Chris Wren, XDS

Service providing respondents were largely undecided as of yet whether the crisis would cause a hike in rates. Though only 27 per cent responded there was no foreseeable changes, while 60 pre cent said they simply didn’t yet know. Which certainly points to “possible volatility in market rates in the months to come,” said the report.

Most worrying was that exactly half of service providers indicated they thought there was a risk to their solvency over the coming year. Highly-concerning whether you’re a service provider or a client relying upon a provider for the release of their title.

“Service providers do not have the revenue streams that developers/publishers have, so help support them while this crisis plays out,” A survey respondent told XDS.  “We all need them to survive and be functional when things do begin to return to ‘normal’. Commission work and pay partially up front, enabling them to keep cash flowing and avoid having to lay everyone off. Help them out now and they will happily work their collective asses off once lockdowns start to lift, safe in the knowledge that they have cash flow to survive.”

MITIGATION STRATEGIES

Some publishers and developers have already been forced to mitigate the impact of COVID-19. In the survey, 24 per cent of respondents have already shifted production to alternate service providers in order to best continue with their project. 

Other steps taken by developers and publishers is to agree to WFH policies for external partners (47 per cent), which of course could reduce the security of the project. Because of this, publishers and developers are requesting service providers make numerous reassurances, such as secure and encrypted connections, revised legal agreements and NDAs, as well as wanting to ensure employee health and on-time delivery.

Help them out now and they will happily work their collective asses off once lockdowns start to lift, safe in the knowledge that they have cash flow to survive.”

Concerningly, 22 per cent of developers/publishers have already decreased the scope of their games and 13 per cent have taken on more internal staff to offset issues with external providers – likely due to the virus hitting providers in Asia before it reached western countries. 

Meanwhile, 94 per cent of service providers have shifted staff to WFH setups, while 14 per cent have added multiple shifts to their offices in order to reduce density. In short, the industry is reacting quickly and comprehensively to keep functioning through the crisis, but there’s a lot to tackle and some slowdown is almost inevitable. Though on the positive side, the crisis may precipitate change for the whole industry going forward.

“This is a paradigm shift for distributed (external) development. When we all survive this crisis EVERYONE will be familiar with working with remote teams and will hopefully embrace the opportunities they provide.”

For more insight and information on XDev providers, and to find out about the XDS Summit in Vancouver in September, head over to xdsummit.com.

 



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