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Last update - 01:32 19/10/2006 Gaming kicks off in Israel By Guy Griml "The Israeli market displays a high level of technology, but lacks profrssionals and is a far cry from its target market, the United States," says Guy Bendov, offereing his assesment of the Israeli gaming industry. Bendov is a founding partner and business development manager at the Israeli startup, DoubleFusion, which develops technology for intergrating computer games. According to him there are currently 15 computer gaming startup companies in Israel. "Most of them are new and have raised more then $35 million dollars. They offer the international market technology-based service development, hardware and the development of games for personal computers, cellular telephones and consoles, " continues Bendov. This Thursday, the Israeli chapter of IGDA (International Games Development Association) will be hosting "Capital Games - The state of play in Israel," which will provide an assessment of the links between Israel and entrepreneurship in the gaming industry. "The idea is to update the investors concerning the market, the trends and the quality of the market," explains Bendov, "and to offer support to the educational institutions and the industry's workers, in order to increase the number of professionals in this industry." Many investors are attracted by the tremendous profitability of the game market, but it has other drawing cards, too. Advertisement "The American game market is worth more than a billion dollars annually and is one of the markets that grows even when the stock indexes in the U.S. are not rising," says Bendov. "This is an interesting field that attracts attention due to the sums involved and its central position between the worlds of entertainment and technology. As far as entertainment is concerned, this is the fastest growing market that targets the general public, and in the technology field, it boasts constant innovations and uses the most advanced technologies. "This growth requires a lot of 'movable parts,' that include not only the creative side, with which everyone is familiar, but also hardware and software infrastructure, plus the accompanying services, in which Israel is very successful. Companies in this field include Ideazon Gaming Precision Tools, which began in Israel and sells specialized keyboards; DoubleFusion, which provides advertising sales services to companies like THQ and MIDWAY; and Oberon Media, which provides ITV games to Microsoft and Pixel. These are a just a few examples of companies that have proved to investors that it is possible to create a success story in the global market from Israel." Convincing venture capitalists One of the biggest challenges facing game companies in Israel is obtaining capital investments, which is very difficult even though sales of video games have risen significantly in recent years. One reason for the venture capital industry's hesitancy is that VC funds are still licking their wounds from the high-tech bubble era, and shy away from investments in small companies that develop games in a market controlled by big players like Electronic Arts, Sony and Microsoft. Another reason is that the business model followed by companies that develop computer games makes it difficult for VC funds to invest in them. Most of the companies release several games, but usually only one of them becomes a blockbuster, providing almost all of the company's revenues. This is not a model favored by the VC industry. "Data collected by Thomson Venture Economics indicates that VC funds invested only $37 million in game development companies in the U.S. in 2002, down from $66.9 million in 2001 and $295.3 million in 1999. By contrast, NPD market research found that in 2002, U.S. sales of video and console games grew by 10 percent, to $10.3 billion. "NPD also found that video game sales in the first nine months of 2006 rose 48 percent compared to the parallel period in 2005," says Bendov, adding that 2006 is expected to be a record-breaking year for the video game industry in the U.S. "No Israeli game companies have yet had significant sales," continues Bendov, "but a few interesting initiatives are in the works. Funtactix is focusing on an online game using a unique technology, while GamearraY is developing an engine for user-generated, personalized mobile video games. Both these startups are being funded by Jerusalem Venture Partners Studio." Another new Israeli game company is Progressive Internet Gaming, which specializes in social games that combine video and Internet. The company attracted $2 million in its first round of capital raising, with Jeff Pulver, one of the pioneers of the global VoIP industry, heading the group of investors. Prime Sense is another company that managed to impress VC funds, raising $9 million from Gemini and Genesis Partners. The company does not develop computer games, but has created a unique technology that is very suitable for the gaming world. Prime Sense's plug and play system includes a chip, interface and Internet camera that gives electronic devices a digital, three-dimensional view of, and the ability to react to, their surroundings. Bookmark to del.icio.us   Auschwitz gimmick U.K. Tory chief draws fire for calling school visits to Auschwitz a gimmick. 5 Stops in Galilee Rock hares, peach orchards, a taste of the past, and walking the Jesus trail.   1.   Parasitic Past-Time...Where is "Productive" Zionism? 11:42  |  Ben Israel 19/10/06   2.   #1 Ben Israel these are only games 16:17  |  Chaim B. 19/10/06   3.   What does this have to do with the link on the home page? 11:05  |  sh 20/10/06   4.   gaming 18:33  |  dan 20/10/06   5.   Gaming ( Gambling) in Israel 21:47  |  Manny F. 20/10/06   6.   to dan 22:17  |  jack 20/10/06   7.   oh please!! 03:53  |  FaMj 24/02/08

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