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Many Australian game studios are closing.

OCT. 17, 2011 • KMM Brisbane became the latest game studio to shut down in Australia. The branch of KMM Sydney was set up to work on Happy Feet Two on various platforms and had been operating for less than a year. Many of those employed there had come from Krome Studios, which was shuttered in 2010. Other Australian developers to close down in the last two years include a branch of EA’s Visceral Games, Pandemic Studios, Team Bondi, as well as THQ’s Brisbane and Melbourne studios.

Impact: Live by currency exchange rates, and die by them. When the Australian dollar was valued at about half the U.S. dollar, shifting development to the growing number of studios in the country was very easy. Game designers were talented, and they spoke English. But the Australian economy has been managed quite well during the recent worldwide financial distemper, forcing the value of the Australian currency up. With game development no longer the bargain it once was, projects are fleeing to other countries. Studios not closing down are shifting to making less-expensive mobile games. But for mainstream titles, it would appear that survival depends on creating and publishing independent IP, probably with added incentives from the Australian government to help sustain developers during the transition.