Ups, downs and the unknown: What 2020 was like for some Alberta digital media companies
Like the rest of the country, Alberta has been hit hard by the economic repercussions of the COVID-19 health crisis. Its digital media sector includes companies that have suffered indirectly from the historic drop in the price of oil earlier this year. However, others have managed to do well and seize new opportunities during this very particular year.
When non-essential businesses in Alberta were ordered to close at the end of March, customers of fitness centres and staff were forced to find new ways to workout. That’s when Plankk, a Calgary-based fitness app developer, saw a huge increase in demand for their services. The Alberta company was already developing apps for fitness influencers around the world, so when personal trainers needed a way to still make a living, the technology company adapted. “Plankk is very fortunate to work in the sector. We’re really one of the industries that have been accelerated by at least five years,” said Colin Szopa, CEO of Plankk. The company had to hire more staff to keep up with the demand for apps. Nine months later and the demand continues, Szopa said.
The company’s success is somewhat of a rare example in the province. Alberta has seen huge job losses in the oil and gas industry, a major driver of the province’s economy. The western province has also had some of the highest unemployment rates in the country over the last few months. For Alberta’s digital media sector, experts say there’s a split on how businesses have been doing during the pandemic.
For some companies in the sector that relied on the province’s energy companies as a major source of revenue, it’s been a difficult nine months, according to Luke Azevedo with Calgary Economic Development. For others, like those in the interactive media and gaming sector, there was a huge demand for games and online programs while people stayed at home. “I think everybody is adapting. They have to. It’s a realization,” said Azevedo.
Business owner Miranda Amey is one of those in the sector who has been forced to adapt. The company she co-owns, Edmonton-based Framiras Digital Media, lost one of their major clients when they opted to create video in-house. “That was a big hit because that was a steady client,” Amey said, adding that many businesses need video right now more than ever. “Ten years ago, agencies had to convince people to have websites. Now everyone knows they need websites but we’re at the stage where we need to convince people that video is the best form of content and can help their business. But right now, no one wants to hear that. Everyone is stressed and businesses are struggling.”
With no new clients since the start of the pandemic, Amey and her business partner decided to pivot and create a second business while things were slow. The business partners have shifted away from the digital media sector completely temporarily and have put all of their focus into opening a vegan cafe called Palette Cafe. Although Amey and her business partner’s shift to a completely different industry is drastic, she said they’re just one of several examples of business owners in Alberta adapting to the pandemic. “I would say Alberta companies are harder hit but we’re also more entrepreneurial so we’re probably able to roll with the punches a little better than other provinces,” she said.
The provincial government announced in October a $5 million top-up to its tech startup funding program. The Accelerate Fund expanded to $15 million and is meant to support new tech companies and business owners. “It’s one of the opportunities that’s out there,” said Azevedo of the funding. But he credits the entrepreneurs in the sector for the growth during the pandemic. “We can’t forget the reason we have the industry and it’s growing is because of the people who are here. “Many of them being locals starting at the infancy of this sector in our province, have grown with it and have stayed and continued to do their work when they know there are opportunities in other locations and probably could be more lucrative.”
Vince O’Gorman, CEO of Calgary-based Vog App Developers, is one of those business owners. He had considered relocating his growing business to Texas but opted to stick it out in Calgary during the pandemic. Nine months later, O’Gorman said the decision has paid off. Vog has had to double its staff to 47 people to keep up with the demand for custom software and mobile apps. “I don’t know if our counterparts in the industry are experiencing the same amount of growth, but we’re aggressively growing,” he said.
Azevedo and others hoping to expand Alberta’s digital media sector in 2021 are still looking for the provincial government to introduce an interactive digital media tax credit, similar to those in place in other provinces. He said it’s the next step needed in order to increase the number of digital media companies in the province. “We’re not crawling anymore, we’ve started to be into a jog phase but we’d like to be in a run phase,” he said. “Diversification is a reality for Alberta. There’s no choice at this point. Many of the jobs that were here are not coming back.
“This is an opportunity time.”