Triumph of the Small

Two events this week are worth considering in light of one another. First, on Monday, while most of the industry enjoyed the last day of the Easter break, well-respected and long established Scottish independent developer Denki was forced to announce that it was restructuring, with the loss of a number of positions. The reason was simple - one of the studio's games, Quarrel, has failed to attract a publishing partner despite extremely positive feedback from those who have seen it.

The game undoubtedly has commercial potential, but it's a word game, and publishers aren't keen to take a risk on that type of game at present. Denki MD Colin Anderson was unequivocal and blunt in his assessment of the problem - the firm made the error of targeting consumers with its game, rather than creating something tailored to the desires of publishers.

"If you're an independent developer, and you're not selling games directly to customers yet, start worrying," he said in a post on the developer's website, "because this industry is changing beyond all recognition."

A few short days later and hundreds of miles further south, the British House of Commons passed the deeply controversial Digital Economy Bill after a mere handful of hours of scrutiny by MPs. Minor victories were won by campaigners against the bill, including the removal of a hated clause related to orphaned works, but the most worrying aspects - including provision to allow sites accused of hosting infringing material to be blocked from the UK, and further provision to disconnect users accused of infringement - remain intact.

It's a deeply flawed bill, a document which contains a number of solid, good ideas but which has not been debated, scrutinised or considered sufficiently to become law, especially given its astonishingly powerful and wide-ranging provisions. The common refrain from the supporters of the bill within the traditional media industry has been, "but we have to do something!" - which seems to suggest that doing totally the wrong thing is better than doing nothing, a frankly baffling position.

A full discussion of the issues with the bill is beyond the scope of this column; but one of the serious, underlying problems with the Digital Economy Bill is simply that it legislates primarily for a market in which copyright and intellectual property resides with a handful of powerful, monolithic companies who can afford to take the kind of expensive actions against illegal downloaders and their enablers outlined in the bill.

As Denki's problems earlier in the week starkly illustrate, this is not where our economy is moving. The upside of the company's present difficulties is that when Quarrel is released, it will probably belong to Denki and Denki alone. If it is successful, its profits will be returned to the company that created it, and not shared with (or simply skimmed off by) a publisher acting as financier and middle-man.

Publishers, of course, serve an important role in the industry - several important roles, in fact. Even with manufacturing dying out and distribution becoming an increasingly commoditised function, areas like finance, marketing and PR are generally not handled terribly well by small developers, and they're all absolutely vital to the success of a product. They're also, however, inherently portable skills. There are plenty of experts in those fields floating around the industry, many of them actively seeking opportunities to work with small, innovative developers - some even working for free on the basis of a later share in the spoils.

This isn't to say, of course, that publishers and blockbusters costing tens of millions to develop are going to disappear, any more than the rise of cheaply produced YouTube hits has prevented the success of Avatar - but it still speaks of a future in which important IP is vastly more widely distributed than it has been in the past. As more creators learn ways to capitalise on their IP while still retaining the rights to it, and new paths to market open the doors to success to a far wider range of creative teams and people, valuable IP will be increasingly decentralised.