Canadian Business, July, 1995 [cover story]

When 25-year-old video-game programmer Spencer Craske changed jobs last summer, he did it for the best of reasons: fun and money. Between 1991 and 1994, Craske was a programmer at Vancouver-based Electronic Arts (Canada) Inc., the Canadian arm of a leading San Mateo, Calif.-based game developer and publisher. It was his first full-time job after taking part of a computer science degree at Simon Fraser University, and the idea of getting paid to make video games was pure adolescent fantasy. But as the industry boomed and the company grew with it, things got too corporate for Craske’s liking. Then one day, while scanning the Internet, he spied an ad for a programmer’s job at Gray Matter of Oakville, Ont., one of Canada’s hottest independent game developers. He applied, and when an offer came through, he had no trouble making up his mind. “Gray Matter, right now, is at the super-nicest phase,” says Craske. “It’s large enough that it’s successful, small enough that you know everybody. And it’s the most fun place to work in the world.”

For Craske, who is now a senior programmer, fun on the job means drinking gallons of coffee and Mountain Dew, playing with toy dinosaurs and letting his imagination run wild. It’s about writing or refining hundreds of lines of computer code in a single sitting, testing games he and his competitors make, and otherwise hanging with the guys he’s teamed with in the office—whether they’re working on a job, playing road hockey in the back parking lot or trooping en masse across the street for a snack break at the Shoreline Variety. “One group of people I know is incredibly jealous of what I do for a living,” says Craske. “Another believes that programming video games is just not serious enough to qualify as a job.”

Chances are the latter group would change their minds in a hurry if they knew how much money Craske could make in the next year. Game software and hardware is now worth US$8 billion worldwide ($375 million in Canada), compared with US$5 billion spent on movie tickets in North America. And good programmers — the ones who come up with ideas for games and then turn them into reality — are in short supply. By moving to a developer such as Gray Matter, which programs games for every heavy hitter in the video-game industry, Craske has put himself in line for some serious cash. Exactly how much, he and his coworkers won’t reveal, except to say the base salary for an experienced game programmer averages $50,000 to $60,000 a year. Others in the industry say that’s the low end of a range that runs as high as US$120,000.

But base salaries are just the appetizer. The main course comes in the form of royalties. “That’s how you get rich,” says Deirdre O’Malley, a former Torontonian and cofounder of Mechadeus, a small San Francisco-area game developer. How rich? Last year’s massive Nintendo Co. Ltd. hit, Donkey Kong Country, has sold more than 7.4 million copies. That means US$450 million in revenues for Nintendo and US$32 million in royalties for the UK-based company that wrote the game, Rare Ltd. That may be the ultimate but, according to O’Malley, best-sellers (500,000 to one million copies sold) yield enough royalties to allow a developer to self-finance the creation of subsequent games — which now average $1 million per title.

Every developer distributes royalties a different way — at Gray Matter, which is a private company, all employees share 10 percent of the profits, which are derived from royalties. Staff who work on specific games split an additional 10 percent of the royalties for those titles, prorated by salary. But no matter what the arrangement, designing a winning game can add up to a lot of money.

Lest readers be tempted to start printing out their resumes, however, be forewarned: video-game programming is a job that is so far reserved almost exclusively for very young males. Unless you scooped this copy of Canadian Business from your mom’s or dad’s briefcase and you’ve spent your formative years conquering distant planets and mastering the eye-to-hand coordination needed to beat the most fearsome digital street thug into twitching, bloody pulp, you’re probably too old or the wrong sex to even think about a career change. “I’m 25 and I’m starting to feel old compared with some of the people coming into the business,” says Craske, who nonetheless discounts the possibility that he might be thinking of getting out anytime soon. “Working here is not like going to work,” he says. “I can’t imagine doing anything else.”

There might be a lot of money in the video-game business, but the folks at Gray Matter don’t spend it on furnishings.  The leased office space, 40 minutes west of downtown Toronto, is divided into nondescript stalls, halls and cubicles. In one room five guys in their mid-20s stare at a television monitor showing hockey players skating in lazy circles. All around them video-game posters cover blank drywall. The rest of the room’s decor is more haphazard: cheap toys and small, weird space-alien figures populate a grayish-beige plastic prairie studded with eviscerated junk-food containers and half-empty mugs of cooling, milky coffee. At the far end there is a massive pyramid of empty pop cans.

The only sign that something special might be going on is the stacks of elaborate, expensive computer equipment: oversized monitors, humming minitower computer cases, bloopily ergonomic mice and keyboards, and a collection of gray boxes with black domes. It’s one of these boxes — a new Sega Enterprises Ltd. Saturn game development system — that’s producing the hockey game the guys are watching so intently. The Saturn is Sega’s just-released, next-generation box housing a CD-ROM drive that sends encoded digital data to three dedicated 32-bit RISC processors, all designed to sit atop a TV set. It’s a $500 toy that’s faster and more powerful than the high-end desktop computers of just a few years ago. To the average 14-year-old boy, it’s a totally bitchin’ way-cool unit that’ll smoke any dead-ass game box you ever thought was any good — or so Sega hopes.

Although it’s hard to tell, the five guys — Craske, three other programmers (Paul Martin, Dave Forshaw and Colin Reed) and one computer artist (Mike Upton) — are working to a stiff deadline. They call themselves “Team Canada,” and the three-dimensional game on the screen is their creation. They have three weeks to prepare NHL All-Star Hockey for its professional debut at the Electronic Entertainment Expo (E3) in Los Angeles. They’ve built the game from scratch, writing the codes to render the stands full of spectators, coming up with the algorithms that make the puck skitter across the ice, creating a user-determined point-of-view that allows them to see the action from virtually anywhere in the arena, and loading the statistics of every real-life NHL player into the system. Now they’re playing a demo version, looking for bugs, glitches, dead spots and other potential flaws in order to write new code or tweak the programming. Good reviews at E3 will set up things well for the game’s planned September release. As one of the first titles written to take advantage of the Saturn’s leading-edge capabilities, it has the potential to be a big seller — maybe even the “killer application” that establishes a new hardware system as a “must buy” in the market.

Sega of America Inc. isn’t the only hardware manufacturer bringing a new 32-bit system to market this year. New entrants, such as Sony Corp. (Japan) and 3DO Co. (US), will be trying to crack what is now a Sega-Nintendo duopoly while Nintendo is aiming to counter with a 64-bit system some time in 1996. Gray Matter, with about 60 full-time employees, is developing games for Sega and Sony, as well as Microsoft Corp.’s games unit and major software publishers such as Electronic Arts Inc. and Acclaim Entertainment Inc. With so many large companies competing for Gray Matter’s services and with so much money at stake, Chris Gray, Gray Matter’s 27-year-old founder and sole owner, says it would be wrong to underestimate the weight of his programmers’ responsibilities. “It’s not pimple-faced teenagers anymore,” he says. “The business has changed forever. These things are not written by kids.”

In truth, the typical programmer is somewhat schizophrenic, switching back and forth from being an adult working six-day weeks to meet tight deadlines on million-dollar budgets to being a 12-year-old boy who can gasp “cool” as a two-syllable word — and mean it — when reacting to a new game feature. Likewise, most developers are more likely to hire a hardcore “gamer” who can write programming code than a person with a postgraduate degree in computer science who has never played. But programmers also have to know how the hardware works in order to make software for it. They have to be able to take full advantage of each new technological advance, ensuring their programming makes a commensurate advance and that their games are more complex and challenging. It’s this peculiar mix of technical know-how and creative flair that makes good video-game programmers such a rare commodity. “Finding people to create the programming is the toughest part of the business,” says Gray. “If we could find as many talented people as we could put to work, we would easily be twice or three times the size we are right now.”

Gray knows of what he speaks. He was 13 when he wrote his first commercially successful computer game after teaching himself how to program the personal computer his parents bought. The game was called Boulderdash, and it featured an insect creature running around in mine shafts collecting diamonds. It became an international best-seller during the videogame market’s infancy. That success dictated Gray’s vocation: he founded Gray Matter when he was just 17. “It was fun, I was good at it, and I was making money by doing it,” he says. “You add those things together, and deciding what to do for a living is pretty much a no-brainer.” Such nonchalance comes to the fore whenever any of Gray Matter’s programmers are asked about creating video games for a living. They’re not defensive, exactly. Instead, they’re quick to point out that they work long hours to solve complex problems under lots of pressure. “The fact that it’s creative [work] means it’s difficult to tell when you’re done,” says senior programmer Paul Martin, the 26-year-old leader of the Team Canada project. “My record here is 18 hours straight at the keyboard, writing code.” But in no way does that mean he’s complaining. Like Craske, Martin can’t stop saying how much fun it all is. “We all socialize with each other outside work,” Martin says. “We have meals together, hang out. We are all friends — good friends at that.”

Nowhere do Team Canada’s social and professional aspects blur more completely than when, after a day of video hockey, they drag nets into the parking lot for a game of road hockey Does this count as unwinding after work or extracurricular problem-solving? Whatever the intent, says Martin: “It’s sometimes during those moments — when you’re not at work — that you’ll figure out the solution to a problem that’s been giving you a lot of difficulty.”

When the work is being handed out at Gray Matter, Gray tries to ensure that programmers get the projects that interest them the most. That, says Gray, ensures both passion and productivity. In all the rush over competing hardware systems and technological changes, these remain the qualities that allow good programmers to make good games. In much the same way, the elements that make up a good game have gone basically unchanged since Gray thought up Boulderdash. “Hot, simple, deep,” says Dave Duncan, Gray Matters art director, borrowing a phrase originally coined by industry pioneer Trip Hawkins, who now runs 3DO in California. Hot means it takes full advantage of the hardware’s capabilities; simple means it’s easy to learn; and deep means players don’t get bored the second time they use it.

Stripping the game-making process down to its essentials makes sense for Gray Matter, as do the long days of painstaking programming—because, ultimately, people don’t buy hardware, they buy software. And as long as Gray Matter keeps doing it right, the hardware manufacturers and software publishers will be coming back for more. “Everybody’s got an idea for a hit game. But ideas are easy,” says Jeff McCarthy, vice-president and general manager at Sega of Canada Inc. “It’s the execution of those ideas that’s difficult.” Gray Matter programmers are currently working on two titles for Sega, says McCarthy, because they “get the job done right and they get it done on time.”

Give programmers a chance to expand on the principles of game design, however, and hot, simple and deep get lost in lengthy reflections about the differences between movie making and interactive entertainment. The challenge in movies, they say, is to compel the audience to follow the course of somebody else’s story. Interactive video, on the other hand, must be convincing enough to make players suspend their disbelief, as well as be enticing enough to make players want to determine what happens next. “I knew nothing about programming,” says Duncan, who came to Gray Matter from the advertising business and who, at 36, is the company’s oldest employee. “But I’ve figured out that it’s an art and a science — not just purely scientific, as I had thought. I’ve heard people say, ‘He writes beautiful code,’ yet those two words don’t usually go together.”

“In a sense, code can be beautiful,” says Martin, explaining how a kind of efficient elegance constitutes aesthetic perfection, “Code is a picture of the way someone thinks. There’s an unlimited number of possible solutions to any given programming problem; if your logic is clean and concise, it is beautiful.”

Looking ahead, one of the biggest challenges for programmers such as Martin and Craske may be adjusting their code-writing skills to make games for a  more diverse market. While the overwhelming majority of video-game consumers are still young males aged 12 to 24, there are signs of a change. At one time, 97% of all video-game buyers and players were young boys. Now that figure has fallen to about 85%, and it’s still dropping. The main reason? As the industry ages, so does its audience. Some people who started playing these games as teenagers are now in their early 30s. And while they probably still get a bang out of blasting tentacled monsters to radioactive mush, they’re also looking for something with more mystery and challenge. Women, long excluded from both game making and game playing, are also showing greater interest. And, perhaps most surprising of all, a large potential market has been identified in the over-55 crowd. At least that’s the word out of Quebec, after Le Groupe Videotron Ltee started offering video games on cable TV and found the greatest interest coming from consumers in that older age group — who prefer cards, golf and other sports games to youthful shoot-outs and fantasies.

These changes, of course, pose new challenges for young programmers. Being paid to think like a 12-year-old boy counts when 12-year-old boys are your primary audience. But will these same hotshots be able to think like 55-year-olds? If you grow up at Gray Matter, will you eventually face banishment from the perpetual rec room of the Lost Boys? Or is being a Lost Boy exactly what counts when making amusements for a wired virtual world, no matter what the audience?

While none of this speculation is lost on Gray, his immediate concern is finding more programmers to make the games the market wants today. In the past Gray has hired people from the UK, the Netherlands and various centers across Canada. He says the training people get at Ontario universities such as University of Waterloo and London’s University of Western Ontario is useful, provided the students are gamers first and computer wizards second. But his greatest praise comes for Sheridan College, near Toronto. The school has a world-famous computer-animation program, one that’s furnished staffers for Disney Studios, George Lucas’s Industrial Light & Magic, and other Hollywood studios. As a result, Gray is now working with the staff at Sheridan to develop a curriculum that will make it possible for animation students there to choose video-game and interactive entertainment as their specialty. That, Gray figures, ought to satisfy Gray Matter’s constant demand for qualified staff provided the scores of other talent-starved game developers in North America don’t get them first.

Back at Team Canada’s headquarters in late May, after NHL All-Star Hockey’s debut at the E3 show in Los Angeles, the mood is even more upbeat than usual. In years past game programmers and manufacturers had no show of their own, joining exhibitors instead at twice-yearly consumer electronics shows in Chicago and Las Vegas. Thus, E3 was the industry’s first solo performance in North America. “This is the first time we’ve been separate, not sharing space with microwave ovens and toasters and electric toothbrushes and waffle irons,” Gray says. Things went great and he did plenty of good business.

As for the hockey game’s first trial by fire? The response was “overwhelmingly positive,” says Gray. Most of the negative comments he heard were uttered by competing developers, which he reads as an encouraging sign. A review in Ultimate Gamer, a games magazine, says NHL All-Star Hockey has all the makings of being the Saturn system’s “killer app.”

Before the boys at Team Canada can start counting their royalty checks, however, there’s plenty of work remaining. Feedback from viewers at E3, along with the results of more testing now under way at both Sega and Gray Matter, will make for a busy summer figuring out which improvements can be implemented in time for the game’s scheduled fall debut.

The process is unrelenting, but the programmers seem to love it. “Programming is a huge problem-solving game,” Craske says. “You’ll never get to the point where you get a completely bugfree list, ever.” And so, while the debugging continues, they are also compiling a list of more complex upgrades that they’ll implement in the next complete version of the game, after the first one has run its course in the market.

“We’ve already got quite a list like, we’d love to vary the attendance in the arenas from game to game,” Martin says.

“That’d be great,” Duncan chimes in, suddenly more intense. “You go to Hartford, they’re on a losing streak, so there’s only 2,000 people in the stands.”

“Right,” Martin counters. “And for playoff games, the arenas will be totally packed.”

Hot, Simple, Deep

These three words spell blockbuster videogame

Members of Gray Matter’s five-man core “Team Canada” development squad spent more than a year designing, writing and refining NHL All-Star Hockey. The game, now in its final testing stages, goes on sale in September. As one of the premier tides written for Sega Enterprises Ltd.’s next-generation Saturn game system, it has the potential to be a big seller. But, according to Dave Duncan, Gray Matter’s art director, even if the new Sega hardware is a hit, NHL All-Star Hockey will only score big if it meets the three essential conditions of great game design, as originally set out by industry icon Trip Hawkins.

IT MUST BE HOT: “Hot applies to the graphics and the sound and the surface things,” says Duncan. “All the hockey games that have come before have offered a top-down view of the rink, where the camera pans back and forth. Ours is fully three-dimensional; many different camera angles, including some that are impossible in the real world, such as a ‘puck’s eye’ view. Those details are things that people will appreciate. With the sounds, for example, we’re making it so that they are triggered by action on the ice. If you’re playing at Maple Leaf Gardens and Toronto gets a penalty, the crowd will boo.”

IT MUST BE SIMPLE: “A nine-year-old should be able to play it without a manual, which means that adults should be able to enjoy it too. You have to be able to get into the game quickly and the controls should be intuitive.”

IT MUST BE DEEP: “People have to be able to keep playing the game again and again and again without getting bored. Deep means content, lots of layers, like an onion, you can just keep getting into this game, layer by layer. We have the stats—real stats—from previous NHL seasons for all the players in the league. You can play an entire 84-game regular season if you want to; the game keeps track of everyone’s records. You play the game as a right-winger; you can out a season as a left defenseman. We have all the trophies, including all the historical information on them and who they’re named  after. There’s a video tour of the Hockey of Fame. It’s not just what you see the first time you walk by; there’s a lot more to keep coming back to.”

Straight To Video

Movies are fast becoming video-game software

Hollywood has tried making movies based on successful video games—Walt Disney Co.’s Super Mario Bros., for example—but they’ve stiffed at the box office. However, turning films into video games has the makings of a more fruitful union.

It started with smaller interactive producers; now most of the big Hollywood studios are getting into the act. The appeal is partly technological—the new generation of game systems is the first with the technological oomph to deliver these interactive game/movies. Even more appealing are the games’ high profit margins—hit movies and games both return hundreds of millions of dollars to their producers. But where a major film might cost US$50 million to US$100 million to produce, game budgets top out at US$2 million.

Industry watchers say the successful players will be those who can best convert films based on linear story lines into interactive games that allow players to determine plot and actions. “The two media still have such different concerns that you can’t really swap many elements [between them],” says Jonathan Wiedemann, of Hollywood’s Propaganda Co. of Digital Entertainment (CODE). Wiedemann is the executive producer of a CD-ROM version of Johnny Mnemonic, which went on sale in May, the same time as the cyberpunk movie Johnny Mnemonic opened in theatres.

For example, while some interactive games begin with extra scenes shot on the movie sets, Propaganda CODE staged its own parallel production, with different sets, props-even some actors, whose thespian responsibilities are completely different. “The way an interactive title unfolds,” Wiedemann says, “one particular scene can lead to four or five others. If a character is angry in one scene, the next one might have him crying or laughing or fighting. If the acting is too intense in the first scene, you’ve got continuity problems.”