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Video game industry a bright spot in Mass.

Dance Central 3 is one of the video game creations of Harmonix Music Systems Inc., located in Cambridge.

Despite the sluggish US economy, the Massachusetts video game industry keeps growing, according to a survey by Massachusetts Digital Games Institute (MassDiGI), a state-sponsored game development center at Becker College in Worcester.

The survey found that Massachusetts game companies directly employ 2,041 workers, up 78 percent from the number found in a 2009 survey by the Massachusetts Technology Leadership Council. On average, these jobs pay $90,000 a year, for a yearly statewide payroll of over $234 million, including benefits.

Moreover, almost 40 percent of the 112 companies that participated in the survey plan to hire more workers over the next 12 months.


MassDiGI’s executive director, Timothy Loew, said the state’s gaming sector covers more terrain than people may realize. In addition to a cluster of thriving companies in Greater Boston, he cited substantial activity in the Worcester area, as well as start-ups in Amherst and Northampton.

“These numbers indicate that our clusters are healthy and vibrant, and they’re poised to grow,” Loew said.

When the group issued its study three years ago, one of the biggest game developers, Harmonix Music Systems Inc., of Cambridge, was riding high on its Rock Band music games. Since then, demand for music games has dropped dramatically. Back then, the games from Harmonix and other Bay State companies were expensive and designed for use on consoles such as Microsoft Corp.’s Xbox 360.

Today, the fastest-growing segment of the industry builds much smaller games that run on smartphones or tablet computers and often sell for less than $5.

Massachusetts is home to a host of well-known game development companies, including Harmonix; Irrational Games in Quincy, maker of the popular action game BioShock; and Turbine Inc. of Needham, maker of adventure games Lord of the Rings Online and Dungeons & Dragons Online.

There are plenty of lesser-known development houses, too, including quite a few start-ups. Indeed, the MassDiGI study found that 28 game companies were launched in Massachusetts in the past three years.


One of them, Boston-based Disruptor Beam Inc., was founded in 2010. The company is currently developing Game of Thrones Ascent, an online social game based on the popular fantasy novels of George R.R. Martin.

Disruptor Beam’s chief executive, Jon Radoff, said Massachusetts has lots of people with the talents needed by the industry, including software engineers, artists, writers, and musicians. “I think we have a strong ecosystem,” Radoff said. “We have skills across the board in everything you need to build a computer game.”

But Albert Reed, chief executive of Demiurge Studios Inc., a development studio in Cambridge, warned that too many of these skilled workers are leaving town to work in California and elsewhere.

“There’s a constant drain from the East Coast to the West Coast,” Reed said. That’s partly because cities like Los Angeles, San Francisco, and Seattle are home to some of the world’s largest video­ game publishers, like Acti­vision Blizzard Inc., Microsoft Corp., Nintendo of America, and Electronic Arts Inc. No Massachusetts company has achieved similar scale.

“We do not have a very large anchor developer or publisher here right now,” Reed said. As a result, when local companies try to recruit talent, “we’re swimming upstream a little bit.”

Loew said Massachusetts should offer tax incentives to video game companies to encourage start-ups and to encourage companies in other states to relocate.


But such incentives could be a tough sell after the collapse in May of 38 Studios LLC, a video game company founded by former Boston Red Sox pitcher Curt Schilling that relocated to Providence after Rhode Island provided $75 million in loan guarantees. Rhode Island could end up losing over $100 million on the failed investment.

“That was the aberration, that was the outlier,” Loew said of 38 Studios.

He said that instead of investing taxpayer money, Massachusetts should offer incentives that lower taxes on video game companies.

“I think you’ll see that the incentive programs around the world are having a positive benefit to the local economies,” Loew said.

Hiawatha Bray can be reached at bray@globe.com.