Gamespot has posted a discussion with an anonymous developer from the UK, commenting on the string of British studios that have closed recently (i.e. Mucky Foot, Lost Toys, Computer Artworks, Silicon Dreams, Attention to Detail and HotGen).

I thought this was interesting:

Why is this happening in the UK? You don't hear about this many casualties in the US or mainland Europe.

I don't like to hear about developers going out of business in any country, but the reason you don't hear about casualties in mainland Europe is that there are so few mainland European developers left to go out of business. 2001 and 2002 were lethal years in France and Germany. Cryo, Kalisto, Delphine, Polygon Studios, TriNode, Funatics, Phenomedia, Vulpine, Westka - this is just a partial list I'm typing in from memory. Some of these people have already started new companies, but many people are still struggling to find work or have left the industry altogether. So the real question is: how bad is the situation in the UK, compared to the size of the industry? And why did these studios go bust now, instead of one or two years ago?

We're in the midpoint of the console cycle, for god's sake. This is supposed to be the "prosperous" phase.

Hmmm.... last time I heard, 2002 was the best year ever for the industry, and we'd have to wait until 2007 before things would get this good again. But that's because hardware sales are decreasing. I dunno, maybe this is supposed to be the prosperous phase.

Anyway, the developer proposes that the industry should try to cultivate stars, like John Carmack or Shigeru Miyamoto, in order to increase market appeal, and make it more difficult for publishers to take their business to, say, Eastern Europe. It's a good way to add value and differentiate yourself from competitors, but it is not an approach without risks.