Report: As Vancouver Game Scene Shifts, Hothead, Foundation 9 Lose Employees

The video game industry in Vancouver continues to grow, but new reports say many studios in the region are experiencing the impact of the economic slowdown. Backbone Entertainment (Super Street Fighter II Turbo HD Remix) was reduced to "only a satellite operation" back in September 2008 after parent Foundation 9 cut most of the staff, according to regional online news site Straight. Penny Arcade Adventures developer Hothead Games also reportedly struggled to find a publisher for its "environmentally-themed comedy adventure game" Swarm, and was forced to lay off workers in December. Backbone and Hothead join other Vancouver companies who've faced difficulties; Electronic Arts recently canceled its plans to build a new Vancouver studio and instead relocated its Black Box team to Burnaby, and more recently, MMO publisher Nexon closed Humanature Studios, its development headquarters in the region. Historically, the Vancouver development scene often has often seen growth driven by studio closings and acquisitions, as displaced employees form new studios with growth potential. Several new studios opened in 2007 and 2008 including United Front Games, Smoking Gun Interactive, Jet Black Games, PowerUp Studios, Fit Brains, and BigPark. BigPark was founded by Don Mattrick, senior VP of Microsoft's Interactive Entertainment Business, along with Erik Kiss, Hanno Lemke, and Wil Mozell. Mattrick, Kiss, and Lemke are alumni of Distinctive Software Inc, one of Vancouver's first game companies. [UPDATE: Hothead's Joel De Young explains that reports associating the studio layoffs with Swarm's business development in fact came from a misquote. "Hothead did in fact layoff a small handful of employees in November," writes De Young. "We continue work on Penny Arcade Adventures and DeathSpank and are actively looking to grow to three games in development in the studio. Ideally that third game will be Swarm, which we have been slowly prototyping since winning People's Choice in that contest back in late 2007." We're actively seeking a partner to help us make Swarm and have a number of interested parties. Nothing to announce yet." The studio currently employs 35 and is hiring.]