While it was a revelation when Canada shot past the UK to become one of the world’s top three hotspots for video game development in 2010, in 2013 the Ontario Technology Corridor remains among the leaders and has a new revelation for global game development studios considering Canada. The hard-charging province of Ontario is the country’s number one jurisdiction in terms of concentration of companies and overall industry momentum within Canada’s $1.7 billion, 16,000-employee video game sector.
According to the latest “Essential Facts” report published by the Entertainment Software Association of Canada, Ontario has an above-average expected growth rate of 21% for its video gaming companies, which currently employ 2,600 people. In addition, Ontario has the highest concentration of micro and small companies of any province and, at 30%, has Canada’s highest percentage of game development companies.
Earlier this month, Ontario’s dynamic industry attracted Toca Boca of Sweden, the world’s leading digital toy app developer, to acquire the 10-person development team of Toronto-based zinc Roe and create the newly named Sago Sago studio with a global mandate. The acquisition marks Toca Boca parent company Bonnier AB’s first entrance into the Canadian market via the Ontario Technology Corridor. The Corridor includes the Greater Toronto Area, Ottawa Region, Waterloo Region, City of London, and is home to expanding operations by Google Inc., Electronic Arts Inc. (EA), Gameloft Inc. and Arkadium Inc., among others.
Darius Basarab, Senior Business Development Specialist at the Ontario Ministry of Economic Development, Trade and Employment – and Ontario Technology Corridor provincial partner – says, “While our region’s strengths in digital entertainment have attracted large studio wins like Ubisoft, Ontario’s world class talent and targeted financial incentives have created a powerful concentration of highly innovative companies and a vibrant digital media and video gaming ecosystem. Our message at GDC 2013 is this: If your company is growing quickly and expanding, join us in Ontario.”
It was this same confluence of Ontario talent, tax and momentum factors that helped push Canada past the UK as the third largest development community in the world in 2010. Canada, a leader in total video game development head count, now trails only behind Japan and the United States.
The Ontario Technology Corridor is North America’s gateway to innovation. The province of Ontario’s Ministry of Economic Development, Trade and Employment offers many financial assistance and government tax incentive programs to assist businesses, as does Ontario’s Ministry of Research and Innovation and the federal government’s Department of Foreign Affairs and International Trade Canada (DFAIT), including:
- Ontario Computer Animation and Special Effects Tax Credit (OCASE): Refundable tax credit of 20% to eligible companies for qualifying Ontario labour expenses for the production of computer animation and special effect activities in film or TV
- Ontario Interactive Digital Media Tax Credit (OIDMTC): Refundable tax credit of 35% or 40% for eligible labour, marketing and distribution expenditures for the creation of interactive digital media products
- Ontario Media Development Corporation (OMDC) Interactive Digital Media Fund: Eligible applicants receive a non-refundable contribution of up to $150,000, to a maximum of 50% of the project budget, to create a market-ready interactive digital media product
- Ontario Production Services Tax Credit (OPSTC): Refundable tax credit of 25% based upon eligible Ontario labour and other production expenditures
- Scientific Research and Experimental Development (SR&ED) Tax incentives: Incentives aimed at innovative companies to reduce R&D costs
See full lists of tax incentives programs for Books, Magazines, Music, Interactive and Film & TV on the Ontario Media Development Corporation (OMDC) web site.