OPINION: Competition heating up for agencies and distributors

Leigh Harris
OPINION: Competition heating up for agencies and distributors

Leaner times on the publisher front will mean an increase in work for agencies and distributors, but also an increase in competition.

A while back, MCV speculated that pressure on the pricing front would be met with publishers having to sacrifice some margin in order to stave off the threat of direct imports. This was happening during the middle of a global recession which was hitting Europe and the US, the home base for most of the local publishing arms, much harder than Australia, the flow on effects of which would always impact on the satellite offices here.

While prices have begun to come down, this hasn't been the cause of any changes at a publisher level, with both major shifts locally coming as a result of global infrastructural changes (coming out of increased pressure from the financial crisis) rather than being based on specific local factors. We've seen THQ undergo a restructure and Sega close its Australian operations entirely in recent times, but this isn't going to stop the demand for or release of those companies' games.

This means an increase in potential work for the existing sub-distributors and other local outfits, which has led to several new players entering the fray.

In the last year alone, we've seen the formation of gaming marketing agency Surprise Attack, Bohemia Group enter games PR taking the Namco Bandai account, Bluemouth get into the headset gaming space with competitor brand Astro, Turn Left Distribution pick up the Disney account and most recently ex-Sega staff forming Five Star Games and taking on Sega's distribution responsibilities (and not ruling out the possibility of expansion to other brands).

The stalwarts of the distribution sector will have to re-prove themselves against new blood in a fight for these new opportunities coming out of publishers, while at the same time a flatter landscape globally will mean smaller brands previously unknown on ANZ shores (Astro, Hawken and Rovio titles were picked up by Bluemouth, Meteor and Tuff Kat respectively to cite a few recent examples) will continue to penetrate the market for the first time, and will need their own representation.

It's entirely possible the result will be a further increase in the overall number of companies tackling distribution and publicity responsibilities, with more brands being handled by a more diverse range of specialist agencies and distributors.

A more distributor / agency-heavy landscape would more closely reflect the turn of the millenium breakdown of publishers / distributors in Australia (or a model not too far removed from that of New Zealand currently) however these are extreme examples.

The extent of the shift may already have been felt. Time will tell.


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Tags: THQ , Distribution , sega , pr , marketing , agencies , Surprise Attack , Bluemouth Interactive , Turn Left Distribution , Five Star Games , Astro

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