Schilling: Mass. will lose video game business without tax credits, startup support

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April 16, 2010, 1:48 pm
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(NECN: Cambridge, Mass.) - Want to make Massachusetts a thriving part of the multi-billion dollar video game industry? Then pass tax credits for the industry - and that's just the start.

That was the message from former Red Sox pitcher and founder of 38 Studios, Curt Schilling.

"I'll make it easy for you. If this state doesn't find a way to bring tax credits to this industry, the best possible scenario is that this industry will stagnate in an epic way," Schilling told participants in an industry conference at MIT Friday.

But he noted that credits alone won't do it.

Other states are aggressively pursuing game companies, including his own 38 Studios, Schilling told the crowd, and Massachusetts needs to tailor its strategies to big and small companies if it wants to create an incubator for the video game business in the Bay State.

"I would argue that the problem here is... there is a massive gap in state assistance," Schilling said. ""If you're going to give a three-person start up tax credits - that's irrelevant. If you're going to give them 1500 square feet of space and $ 100,000, that's relevant."

Schilling noted that often investing in start-ups at their initial stage ends up being a far more cost-effective strategy for cash-strapped states than trying to attract large companies with massive tax credits.

"If you can invest in (startups) at that stage, then you are going to create business loyalty, if they can get to the next stage of the business with your help as well."

But Schilling said credits for established companies pay massive dividends as well. He compared the video game development tax credit to the film tax credit currently offered by the state, saying he saw the business impact that film crews had on his hometown of Medfield during the filming of 'Shutter Island' there last year.

He said video game tax credits could be even bigger, as part of a larger strategy.

"The game development tax credit is the film credit on steroids," Schilling said. "It is permanent high paying jobs in ways that states just dont realize the power that these companies bring to the local economy."

"But there's a lot of things at the grassroots level that are far cheaper, and there's a lot of business square footage that's not being used that the state could capitalize on for startups."

Tags: Curt Schilling, 38 Studios, tax credits, video gaming
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