The Australian developer of the Happy Feet Two videogame, Kennedy Miller Mitchell (KMM), closed the doors to its Brisbane studio at the end of last week.
The developer had been reported to have been planning to close when the game was finished for some time, but the ABC is reporting final confirmation from former KMM art director Jason Stark.
Stark says: "With the dollar currently above the US, it's now more expensive to make a video game here than what an American publisher considers locally."
"We're losing a lot of talent, and your nation quickly gets to the point where if times do come good again, we're not going to have enough experienced people here to start the companies."
According to the ABC report, the strong Aussie dollar and a lack of tax incentives are only part of the reason studios here continue to close, although this flies in the face of rapidly expanding indepent game studios who are leaving the traditional models behind.
Developers Firemint, Iron Monkey, Halfbrick and New Zealand's Sidhe are proving very successful off the back of mobile and browser-based games.
The Australian government does seem to be getting the message, however, as the Digital Media Initiative was renewed for a further two years on Friday and renamed the Interactive Media Fund, which should see multiple smaller projects in New South Wales begin to flourish.
KMM's Brisbane closure does, however, add to a long list of high profile closures throughout Australia recently, most recently including L.A. Noire developer Team Bondi, whose employees were reportedly all offered jobs at KMM.
KMM's Sydney studio remains open. MCV is seeking an official comment on the Brisbane closure, as confirmation has at this time come only from staff.
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