Published as part of our sister-site GamesIndustry.biz's widely-read weekly newsletter, the GamesIndustry.biz Editorial, is a weekly dissection of an issue weighing on the minds of the people at the top of the games business. It appears on Eurogamer after it goes out to GI.biz newsletter subscribers.

The demise of developer Realtime Worlds is something of a seismic shock for the UK games business, and especially for the town of Dundee - one of the locations where game development has particularly thrived in this country over the past decade.

In the immediate term, it means that hundreds of developers are out of work. The human cost of a company of this size collapsing is immense. Families will be uprooted and relocated, and some will struggle to keep their heads above water, especially since the firm apparently lacks the funds required to pay wages and redundancy packages.

In the longer term, however, I suspect that the impact of RTW's demise will be felt by the UK games business for many years to come. The company's failure is not entirely a shock - it launched an MMO-style game which was hugely expensive to develop, but which received poor reviews, a combination which would be a fatal blow to most game companies. The scale of the failure, and the context in which it has happened, however, will have a major impact on how the industry does business.

Realtime Worlds absorbed an absolutely vast amount of investment - over $100 million of publicly declared investment. It worked on a game which was enormously ambitious, but seemingly dogged by poor management, leading to huge delays and, I suspect, vast amounts of wasted development effort on features and content that didn't make the cut. According to its newly-appointed administrators, the end result is a firm that's Ł3 million in debt and can't afford to pay.

When the company was taking all that investment, it looked like Dave Jones and his team were in the perfect position. He was the high-profile developer, the creative mind behind the global brand that is Grand Theft Auto - a name which would resonate in the boardrooms of investment firms just as well as it does in the bedrooms of college students. GTA undoubtedly opened doors, and Jones' bullish style, his aggressive talk which minced no words about taking tens of millions of dollars to build a great game, is exactly the kind of thing that some investors want to hear.

Independent developers have often struggled to make themselves attractive to large investors, so what Jones was doing looked like magic. Some even felt like RTW was blazing a trail that the rest of the industry could follow, opening doors to major investment which other developers would be able to pass through.

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Rob Fahey

Rob Fahey

Contributing Editor

Rob Fahey is a former editor of GamesIndustry.biz who spent several years living in Japan and probably still has a mint condition Dreamcast Samba de Amigo set.

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