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Video games used to be political cannon fodder on the state level, with politicians creating laws to stop the sale of violent video games to minors. But these days, states are realizing that the jobs created by game studios are just as good as any other ones.
Gameloft is announcing on Monday that it plans to create a game studio in New Orleans with as many as 150 people. The French mobile game publisher is taking advantage of the generous incentives from the state of Louisiana, which is making a concerted effort to compete for jobs of the future.
Samir El Agili, general manager for the U.S. and Latin America at Gameloft, told game web site Joystiq, that the company could hire as many as 150 people in the studio over the next decade, thanks to the rapid expansion of the handheld and downloadable games market. The studio will work on a diverse range of content, including downloadable games, mobile, Xbox Live Arcade, PlayStation Network, Facebook and future consoles.
Louisiana has joined other states that are also wooing game companies. Among those offering incentives are Texas and Canadian regions such as Montreal, Toronto and Vancouver. About 20 states offers some form of economic incentive to game developers. Louisiana has also scored Electronic Arts, which is creating a North American game testing center at Louisiana State University in Baton Rouge.
With high unemployment, it makes a lot of sense for states to try to kickstart a specialty industry with state help. But the incentives are costly, and sometimes the efforts don’t work. But if the seeds take root and the local companies become successful, they can become self-sustaining job engines, as new companies spin off from the old ones. That’s the theory, anyway, and its backed up by a McKinsey & Co. study commissioned by the state governor’s office. (The building at right is the one that Gameloft will move into).
Louisiana offers a 25 percent tax credit for tech companies and a 35 percent payroll tax credit. If one of the game developers makes $100,000 a year, then Louisiana pays the game company $35,000. Gov. Bobby Jindal is expected to make an announcement about the deal on Monday.