Getting impatient for next-gen | This Week in Business

This Week in Business is our weekly recap column, a collection of stats and quotes from recent stories presented with a dash of opinion (sometimes more than a dash) and intended to shed light on various trends. Check back every Friday for a new entry.

Please excuse the headline misdirection, but this column will not be about the PlayStation 6, New Switch U, or whatever infuriating naming convention Microsoft comes up with for the next Xbox.

QUOTE | "It takes generations for change to happen." - Outgoing IGDA Foundation head Nika Nour, in an interview that touches on some of the structural problems that haunt the games industry and keep us reliving the same awful calamities over and over, like a sexist, racist version of Majora's Mask.

That quote could be underscoring the need for patience when looking for the industry to improve itself, but as an increasingly impatient person on this front, I take it instead as a reminder that mistakes of the past often echo into the present and future.

Take new indie studios, for example. Who has the easiest access to funding and a network of connections to help them start their own studio? Successful game developers, of course, particularly ones with some kind of senior leadership position on a very successful AAA property.

So how do you get a senior leadership position like that? Publishers don't just hand those jobs out to newcomers, no matter how talented they seem. Before a company entrusts someone with a key role on its golden goose, it's going to want to see a track record of success that stretches back more than a handful of years.

In the past decade, I've interviewed a bunch of developers who struck out on their own after finding success at companies like Riot Games, Ubisoft, and Blizzard. Many of them decided to go into business with friends and colleagues they knew they worked well with. Starting your own company is a huge step, and there's nothing wrong with having reliable people you feel safe with join you on that journey.

But if you're a senior developer at a Riot, an Ubisoft, or a Blizzard, you've been around the block a while, probably cutting your teeth in an industry where diversity was simply not a concern. You've also shown an ability to succeed in environments where marginalized people were not given the same opportunities. And your co-founders who you work so well with together? They're probably coming from the same places, so collectively you might not exactly look like a rainbow coalition.

Now, pretty much every founder we speak to will say they want a diverse company, but that doesn't just happen on its own. It needs to be intentional. It needs to be prioritized. Because when people don't make it a priority, when they simply pull from the pool of people already close to them, all they're doing is making the next generation of game studios look like the last generation.

QUOTE | "The companies I worked at were, let's put it this way, a lot of similar-looking individuals. [There are] a lot of beards at Phoenix Labs. So we took a really hard stance on recognizing the value a diverse work environment creates, both within the product and the studio. And we changed the way we were thinking about our recruiting and hiring pipeline to fix some of the challenges standard hiring pipelines create." - Phoenix Labs CEO and co-founder Jesse Houston, in a 2018 interview, explains how hiring old colleagues from his days working at Riot Games, Bioware, and Ubisoft developer left him with a deficit of diversity.

I don't think it's always intentional when start-ups have diversity problems. But you don't have to intend anything to perpetuate structural inequality. You just have to not try.

The good news, as Houston understood, is that this is a problem you can fix if you actually want to. Phoenix Labs' staff page suggests Houston's efforts have been effective, and in accepting one of our Best Places to Work awards this year, the company noted that roughly 50% of employees come from groups that have been historically underrepresented in the games industry.

STAT | 20 - The number of people in this group photo of new Montreal studio Raccoon Logic, founded by the Journey to the Savage Planet team that was part of Stadia Games and Entertainment until Google pulled the plug on that group in February.

STAT | Minimal - The apparent diversity on the team. I'd say 0, but there are some differing levels of tan and varying amounts of gray hair.

QUOTE | "You know you've really started your new studio when Jason Schreier is already trolling." - Raccoon Logic creative director Alex Hutchinson, simultaneously reacting on Twitter to the Bloomberg reporter noting the lack of diversity in the studio and in the process making it that much harder to attract talented developers who could put a dent in the studio's overwhelming white dudeliness.

QUOTE | "I don't want taglines for us, I just want to do it. We want it to be good. We want to hire a diverse troop from across the board." - Graeme Jennings, CEO of new Montreal studio Monster Closet, which has about 25% of its team made up of women.

QUOTE | "I said racist and sexist things, not because I deeply believed any of them, but because I knew I could get a reaction out of people. That does not excuse anything I said; the impact of my words was the same regardless of what I believed." - Former Apex Legends lead game designer Daniel Klein, in a Twitter thread confirming that he had been fired from Respawn after a deeply sexist blog post he wrote in 2007 resurfaced.

QUOTE | "I sincerely hope these manbabies crying in that thread will grow up some day." - Klein, in a 2018 Twitter thread that was deeply critical of sexist gamers being upset that Riot -- which at the time had just been the subject of a scathing exposé on its sexist culture -- would hold a PAX workshop on getting into the industry exclusively for women and non-binary people. Riot fired him for violating its social media policy.

QUOTE | "It's the intention that matters. We do believe that for companies that have messed up, there's always a path to redemption. And it's never too late, but the earlier you get started, the easier it gets." - Nika Nour again, with a point about leaving the door open for people to be better and do better.

QUOTE | "I wish the punishment, reporting and shaming systems we have were effective in solving this problem but it clearly hasn't been working. The systems in place have been failing survivors for a really long time." - Games and Online Harassment Hotline director Jae Line says the industry needs to recognize the harm it has done before it can properly undo the structural issues that have made discrimination and harassment such a common occurrence. (This interview was published alongside a list of resources for victims of sexual harassment in the workplace that we hope people will find helpful.)

QUOTE | "Our work is never done, and your input is essential as we try to build a safer Twitch." - In promising to take more action against harassment of marginalized streamers, Twitch says it absolutely needs people to tell it about these problems.

STAT | 2% - When people told Twitch about problems with harassment in 2020, the streaming service took action on just 2% of those reports, as revealed by Twitch's transparency report earlier this year.

QUOTE | "This firm has a sterling reputation as a defender of the wealthy and connected, but it has no track record of uncovering wrongdoing, the lead investigator does not have in-depth experience investigating workplace harassment and abuse, and the scope of the investigation fails to address the full range of equity issues Mr. Kotick acknowledges." - In a letter to Activision Blizzard saying the publisher's response to a discrimination lawsuit in California has been inadequate, SOC Investment Group executive director Dieter Waizeneggar questions the choice of lawfirm WilmerHale to evaluate the company's harassment policies.

QUOTE | "We can confirm Luis Barriga, Jesse McCree, and Jonathan LeCraft are no longer with the company." - Activision Blizzard, in response to reports that it dismissed the game director of Diablo 4, Barriga, and two designers who worked on Diablo 3 and various World of Warcraft expansions. No reason was given for their dismissal.

QUOTE | "You received this email because my big data team analyzed your activities in Jira, Confluence, Gmail, chats, documents, dashboards and tagged you as unengaged and unproductive employees... Many of you might be shocked, but I truly believe that Xsolla is not for you. Nadia and her care team partnered with seven leading HR agencies, as we will help you find a good place, where you will earn more and work even less." - Xsolla CEO and founder Aleksandr Agapitov in a letter to 150 employees letting them know they were just fired. And because people who have just lost their jobs for no good reason also apparently need a bit of public shame to go along with that, the letter also contained "a list of those expelled." The layoffs were prompted by a slowdown in the company's revenue growth, which skyrocketed 80% in the pandemic's first year.

QUOTE | "I realize I'm having trouble with my emotional intelligence but I'm working on it." - Agapitov again a few days later, trying to patch things up with employees who felt his callous and inhumane treatment was in fact callous and inhumane. (His intellectual intelligence is fair game for questioning too considering he apparently thought the pandemic boom represented a sustainable growth curve for his company.)

STAT | ¥4.5 billion ($40.7 million) - The amount of money Nexon lost in one quarter because of its $100 million investment in bitcoin. That was enough to cause the MapleStory publisher to fall short of its earnings forecast. Without that loss, its net income would have exceeded the high end of its forecast and then some.