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, but Fernandez believes that the effect the coronavirus is having on game development is being grossly underestimated., he explained that this is due to how much outsourcing is done to China, where the coronavirus originated.‘Equivalent to about two thirds of the external development outsourcing supply is located in China – and they’ve been thrown completely out of whack,’ he said.
‘China has been a top destination for years for outsourcing services in video games, primarily driven by its low costs and scale of available talent. This creates what the banking industry refers to as ‘concentration risk’. ‘This term refers to potential risk that takes place when underlying assets, in this case outsourcing partners, are more correlated in portfolios – games in development – and are less diverse and more concentrated – China. It’s another way of saying don’t put all your eggs in one basket.
He added that, because games tend to follow a rigorous plan, the current disruptions will still be felt long after the crisis is over.
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