Ubisoft 2013 Annual Report Download - page 44

Management Report
2013
39
GENERAL INFORMATION 1.6
CAPITAL EXPENDITURE POLICY 1.6.1
Ubisoft continued its capital expenditure policy, in order to enable the Company to gain traction in new
platforms, develop the online activity and more generally increase its market share. Accordingly, in
2012/2013, internal production costs rose 15% from €334 million to €383 million.
2012/2013
2011/2012
2010/2011
Production
-related capex
€383 million
€334 million
€287 million
Capex per member of production staff
(average headcount)
€57,631 €56,809 €57,003
RESEARCH AND DEVELOPMENT POLICY 1.6.2
In order to develop exceptional video games, Ubisoft has established a project-led R&D policy for tools
and technologies, using the most recent technological advances. The choice of development engines,
tools and processes takes place well upstream in a project, because this choice determines the
potential for innovation and the necessary investment in terms of time, human resources and financing
for the game.
Its close-knit team of engineers who have mastered the best available technologies now enables
Ubisoft to take a highly pragmatic approach to its projects: Depending on the challenges and expected
results on a game, the choice of tools may involve specific internal developments, software already
available on the market, or a combination of the two. Research is thus focused on innovation and
functionality, using technologies suited to a high-quality product.
Development costs on commercial software are capitalized and amortized over two or three years,
with additional impairment losses recognized to reflect the product life cycle. During the financial year,
they were amortized in the amount of €315 million.
Although the Group does not conduct any basic research, it has worked closely with research
laboratories and universities for many years in order to collaborate with researchers in fields
connected to game development. In 2011 Ubisoft Montreal launched a research chair in artificial
intelligence and computer-based learning in collaboration with the University of Montreal and will
invest CAD$200,000 per year in the chair for five years. Since 2010 Ubisoft has also taken part, in
collaboration with Télécom Paris-Tech university, Rennes 2 university and other industrial partners, in
the research and training chair in "Modeling imaginations, innovation and creation" which intends to
explore the sources and techniques of innovation processes. Lastly, in December 2012 an agreement
was signed with the French government to finance a research and development project in the amount
of €3.5 million in technologies for the new generations of games. This project will involve some sixty
people from Ubisoft, the CEA (French commission for atomic energy and alternative energies) and
LIRIS (laboratory for image IT and information systems), part of the CNRS/Université Claude Bernard
Lyon.
These initiatives allow Ubisoft to complete its internal developments while still encouraging openness
to the many technological fields which now comprise the creation of interactive experiences and
content which are increasingly advanced and immersive. This enables Ubisoft to contribute to the
influence of the video game sector for the whole industry.