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Wednesday, May 22, 2013

Why the Finnish Game Industry Rules the World?

The Finnish game industry is comparatively speaking quite small. Depending on the source it employs somewhere between 2,000 to 3,000 people. Nevertheless it has made a significant impact on the market. How can that be possible?

I managed to get some insight to the topic yesterday as I participated in a local event organized by Jyväskylä Entrepreneurship Society and Expa, a gaming collective of sorts. They managed to bring Samuli Syvähuoko, a serial entrepreneur on a crazy crusade, here in the middle of nowhere.

He is the man behind successes such as Remedy Entertainment and has his roots in the Finnish demoscene through Future Crew. This makes him an ideal observer and mentor. And that is the role he seems to have taken right now. In this post I will go through some thoughts inspired by his excellent presentation.

Angry Birds, Clashing Clans

Many of you might recognize names such as "Angry Birds" or "Clash of Clans". You could claim these games are just quirks, freaks of nature. But there's more to the Finnish game industry than that. There have been success stories before. Remedy's "Death Rally" and "Max Payne" come to mind for instance. If you dig a bit you can find many more titles that have at least made a dent on the market.

Success breeds success. You could say the foundation of the current success was laid by the demoscene culture beginning in the 80s. Many companies, Remedy and Futuremark included, were born out of the connections made back then. Then there was that company known as Nokia. It made a difference on the mobile sector and helped to develop the talent. Finland is an engineering country by definition.

When you combine dark winters, high technology and sisu ("persistence"), you get an explosive combination it seems. Sure, there has been a lot of failure but it looks like there is something inherent in the Finnish culture that allows at least some the get past that. In addition there is capital available up till certain point. The situation could be better, though.

Better than Swedes

The Swedish game industry provides an interesting contrast to the Finnish one. It is very surprising that even though Finland is much smaller as a country (5 vs. 9 million), there are way more game studios in Finland. And they are making a bigger impact. Can you name a Swedish game title? Took a bit of thinking, didn't it?

According to Samuli the major difference has to do with persistence (that "sisu" thing). Finns simply take failure better and don't give up as easily. Granted sometimes this sort of doggedness isn't entirely healthy but that's what it takes in the game industry. There are no instant wins.

The industry has been structured differently as well. There are a couple of leading stars like Remedy and Rovio but even they are quite small (hundreds of people). It seems in Sweden the winners take it all to quote Abba. In short the talent gets employed to the established companies rather than striking on their own.

Boom, boom, boom

There is definitely some kind of a game industry boom going on at Finland. At least based on the amount of hype. You know something has changed when even the government begins to take steps to increase the amount of education and resources available for the industry. It feels like there is a bubble forming. Some of the hype might be justified but I think some people will just disappoint themselves.

That is the nature of the industry, though. As Samuli said, it's not enough to make a great game. You have to make a game that allows you to pay the bills. Effectively you have to figure out how to monetize on it. Rovio and Supercell are excellent examples of companies that have made good enough games with excellent monetization models. And they have become great at optimizing these models. They know what makes the players tick and what does not.

Fun + Money = Profit

It seems this is one of the cornerstones of a modern game company, analytics. Business analytics have been around for a long while. It has been just during the past few years that the field has found its way into gaming, though. It is making a huge difference on the sector. Rather than developing something and then praying it works you can effectively measure how well it works. This leads to better games, and of course, monetization.

It can be dangerous to focus only on the monetization aspect, however. If you start designing your games in Excel, you will lose all the fun and lose the whole point of gaming. Just like other creative industries, it is one of those fields that allow us to experience something new. You could say games are all about stories given they might be a bit simple ones at times.

Industry Challenges

How can Finland capitalize on its recent success? As I stated earlier even the government has become aware of the situation. The industry is booming and barely can keep up with the demand for labour. New industry hubs are appearing all around the Finland. Tampere is a very good example of one. The biggest challenges remain in developing mentoring and the funding sector. You will need those leading stars to show the way. We have a couple but we could use some more.


The answer to the question "Why the Finnish Game Industry Rules the World?" isn't entirely simple but I think I have some clue now. It comes down to at least the following factors:

  • Demoscene - The legacy lead to the birth of certain leading stars of the industry
  • Climate - Cold, dark winters provide an opportunity
  • Culture - "sisu" (that persistence thing) is a cultural value that allows Finns to plow through failure
  • Technology - As an engineering country we have a strong understanding of technology
  • Education - Even though we don't have Harvard level education it seems to be good enough

I might be missing a few but these are the most important ones in my mind. As a capital poor country we have had to find our own ways to success. It seems finns and gaming are a very good fit. The recent mobile revolution certainly didn't hurt things even though we lost that one big company. The industry as a whole seems to be reforming itself and I expect we will see a lot of small yet profitable companies emerge within the remaining decade.

In case you find the topic interesting and wish to gain more insight to it, I recommend checking out a documentary known as Pelinrakentajat (Game Makers) over at Youtube. There are English subtitles available.