How to create a gaming industry: The story of the Icelandic Gaming Industry

So, what did you do this summer? Well, I helped create an industry. Over the summer of 2009, the Icelandic gaming industry was born. It started at a meeting in a sports bar in downtown Reykjavik on May 6th. That same year on September 28th, with a room full of people, two Icelandic minsters, people from government and industry, leaders of gaming companies, Erik Roberson from Nordic game and a bunch of gamers, the Icelandic Gaming Industry was founded. This is the story.

To be more precise, you don’t actually create an industry. It’s more like you take what is out there and organize, bring people together. But why did this happen in Iceland in the spring of 2009? After a huge economic boom, Iceland suffered a major recession due to the global economic crises that started in the second part of 2008. Three of the major banks got bankrupt and the currency – the Icelandic Krona or ISK (not to be confused with Interstellar Kredit) fell dramatically in a short period.

The growth of the financial sector after the turn of the century had huge impact on the IT industry. In the years prior to the bankruptcy of the banks they had been sucking almost all talent from the IT and the gaming market into the banks. Offering outrageous salaries, the rest of the market could not compete. Even the passionate game designer was tempted by the lure of money.

At the end of the financial era there came a void. It was out of this environment that individuals and young entrepreneurs started to look at games. However, there was another big reason. At the end of the first decade of the 21st century, the field of gaming had shifted. With the rise of online games and mobile games, the playing field in gaming had changed. The cost of productions had dropped. Few passionate game developers could get together, download the tools and APIs and start creating games for iPhone, for Facebook, and for the online web. The only limit was their imagination.

Another important factor was the role of government and industry. In a recession, the government needed some new energy to revitalize the economy. Anything that was positive and showed potential to create jobs and start the economy was welcomed. Even a tiny games industry was enough to catch the attention of the media and politicians.

The industry, however, played a much stronger and active role. With a few game developers that just organized into an organization, the challenge was to form a structured professional entity.  How could a few gamers become a processional organization? The answer turned out to be simple and that’s where the Association of Industries (Samtök iðnaðarins or SI) come in.  The Head of Innovation, Davíð Lúðvíksson, at SI, did not need much time to take action. He jumped at the opportunity to form a new branch within SI.  He set up meetings and helped the group organize into a formal structure. Strategy meeting was held under the supervision of SI and the outcome was a vision for IGI. Thus, IGI became a member of SI and enjoys their professional guidance and formality. This is the reason why IGI remains unfunded and based on the efforts of volunteers but still can function as a professional organization.

What did IGI accomplish? Now we come back the real reason IGI was formed. In 2009 there were several gaming companies in Iceland. Some of these companies looked the government for support. For example, financial support to attend the Nordic gaming conference in Malmö. The reply was always the same: we can’t support a company. This is not surprising. Any direct support from government, using public money, to a privately held company is suspicious. It just doesn’t work. But if these companies get together, form a group to represent them, it’s a totally different thing.

Some of the activities of the IGI include:

  • Monthly meetups where some insiders in the industry or some guests speak about gaming related issues. The topics range from development issues to specific product introduction
  • IGI Game Award: a competition of game development.
  • The IGI conference: The Future is Bright
And indeed, the future is bright. Three years after the initial meeting was held on the second floor of a sports bar, with the roars of the football fans watching a Champions League game in the background (ok, it was Barcelona – Chelsea), IGI is still going strong. Sure, there are lots of challenges ahead and we still need to convince a lot of people that playing games is actually good for you and parents should encourage their kids to play computer games, but at least we are on our way to change the world.