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How subsidies helped Montreal become “the Hollywood of video games”

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Genshin Impact is an award-winning role-playing game created by Chinese video game developer miHoYo. A year after its September 2020 release, the game managed to amass a total revenue of more than $2 billion. That kind of revenue makes Genshin Impact one of the most profitable video game releases ever and easily miHoYo’s most successful project in the company’s nine-year history.

After seeing such success, it was only natural for the company to expand. The question for miHoYo was: where to go? That question was answered in November when the Chinese developer announced they were setting their sights on the west and establishing an office in Montreal, Canada.

At first glance, this may seem a little odd. Montreal? Why not Tokyo or San Francisco or other cities that have traditionally dominated the tech industry? However, over the past few decades, Montreal has arisen as one of the most attractive cities for video game developers. So attractive that Montreal’s economic development agency, Montreal International, estimates that, as of 2021, more than 200 studios have set up shop there.

The secret to Montreal’s success? Tax credits. The province of Quebec — of which Montreal is the largest city — attracts multimedia companies by offering them subsidies for employing people in the province. Quebec taxpayers pay a large percentage of the salaries of local multimedia workers. These subsidies have undoubtedly helped Montreal become a leading hub for video game development; however, Quebec may have created a system that will perpetually rely on taxpayer dollars to maintain this position. See more at GPB.

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