One step away from bankruptcy and developers behind bars. The largest Czech game studio celebrates 25 years – Forbes Czech Republic

Already this evening, the strings of the Czech National Symphony Orchestra will be heard in Prague’s Municipal House. This time, however, his concert is not intended for fans of classical music or film music, but mainly for video game players. Music from Arma, DayZ, Vigor or Ylands will be played.

The four titles have a common author – the largest Czech video game studio Bohemia Interactive, or Bohemka, fans of the Prague football club will forgive you. The key company of the business empire of billionaires Marek Španěl and Slavomír Pavlíček is celebrating twenty-five years on the market in the Municipal House. However, the anniversary comes at a time when the global video game industry is facing an unprecedented slowdown whole decades.

However, Bohemka is celebrating because its business remains solid despite the market situation, even though it hasn’t released a big game of its own in recent years. She celebrates the fact that she has remained on the scene for a quarter of a century, despite the fact that she had little at the beginning.

It is also almost the last major domestic studio that remained in Czech hands, apart from it, there is only SCS Software of the Šebor family in this collection. The entrepreneurial duo Španěl & Pavlíček hold sixty percent of Bohemka, and thus maintain comfortable control over the company. The remaining forty belong to China’s Tencent.

Photo by David Turecký Marek Španěl and Slavomír Pavlíček, Bohemia Interactive

The company’s twenty-five-year journey from the first order for five thousand crowns to worldwide popularity and billions in sales was certainly not easy. This business story has it all: dreams, hard work, disappointment and success, all wrapped in a good dose of drama.

It includes balancing on the edge of bankruptcy, a tactical simulator for NATO armies, the months that Czech developers spent in a Greek prison, or cooperation with the world’s leading media in the fight against misinformation on the networks.

Let’s therefore let the tones of the symphony orchestra transport us 25 years back to where it all began – to the fairytale world of Mrázik.

First successes

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For a game studio known especially for war simulations, which has a mobile tank parked in front of its headquarters, the story of its beginnings is somewhat atypical. This cute cartoon point-and-click adventure was created at the turn of the millennium just as a side project.

At the time, the studio was almost fully occupied with the development of its breakthrough title, yet Mrázik took hold in the gaming community. Distribution through game magazine inserts, lots of pirated versions and Martin Dejdar’s dubbing helped.

However, the attention of the developers Bohemia Interactive, led by the brothers Mark and Ondřej Španěl and financed by businessman Slavomír Pavlíček, focused mainly on the development of the game with the working name Poseidon.

No one believed this simulation of a Cold War conflict in which a Soviet general attacks a NATO base for a long time. The technologically advanced game with an open world caught the attention of the British studio Codemasters (now part of Electronic Arts), which released it in 2001 under the name Operation Flashpoint.

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The game was a hit in Europe and overseas. The original “boxed” version sold more than two million units. Also thanks to Mark Španěl and his disguise of a Russian army officer, which he put on in the toilets of the exhibition center in Los Angeles, where the giant game fair E3 was taking place.

Bankruptcy in sight

Soon after the sales successes, the developers started creating sequels. But the project with the working name Game 2 did not go well. The bohemian overestimated her powers and focused too much on unimportant details, such as the correct shine of the player character’s eyeballs. In the words of Marek Španěl: “We were left with a disjointed pile from which we were unable to assemble the game.”

Missing deadlines angered the publisher, and Codemasters threw two of their own power into Flashpoint. The ideas of the Czechs and the British about the result began to diverge, and Bohemka fell out with Codemasters. Today, therefore, he is no longer allowed to use the name Operation Flashpoint – the original game is called Arma: Cold War Assault.

The break with the British caused significant financial problems for Bohemka. It lost access to a lot of code from its hit game, the Xbox version of the first game grossed well below expectations, and it wasted a lot of time and energy developing a useless sequel. She avoided bankruptcy only by luck.

She was saved by an idea with simulations for the army. Already after the success of Operation Flashpoint, which brought a number of foreign fans to Bohemka, Marek Španěl made an agreement with one of them and together they started a business in Australia. On the beach near Sydney, game-based tactical simulators began to emerge, which the army could use for training.

After a few years, the operation moved to Prague, where a new division of Bohemka was created, called Bohemia Interactive Simulations. Only then did this business start to prosper and the new financial cushion kept the whole company afloat. Gradually, the division became an independent entity. In 2013, the global investment fund Riverside bought the majority in it for hundreds of millions of crowns.

After breaking up with Codemasters, it was clear to Bohemka that he would need to release a new game as soon as possible. Learning from Game 2’s failures, it took what it could from its breakthrough title and its unfinished sequel to create a new war simulation.

The title Arma: Armed Assault was released in 2006. And it started the most successful game series in the history of Bohemia Interactive, which strengthened the position of Czech studios on the global video game market. If we count the entire series, Arma has become the best-selling venture in the history of the Czech game industry.

Arma was a direct follower of Bohemka’s original vision of a realistic military simulation. It offered players intense tactical combat with an emphasis on strategic decision-making and teamwork. Arma II followed in 2009, bringing vastly improved graphics, complex artificial intelligence, and expanded multiplayer.

From the beginning, the game series has been accompanied by wide possibilities of modding by the players themselves, which have become a typical feature of titles from Bohemia Interactive. The player community, which creates various enhancements for games, counts hundreds of thousands of people in the case of Bohemka.

“These are tens of thousands of modifications of all kinds, different types of completely processed military parties, environments, scenarios… An almost endless supply of content for the game, which is a huge benefit,” explains Marek Španěl.

After the first two Armas, a lot of mods and several official data discs, there were also acquisitions. In 2010, Bohemka strengthened its development capabilities by taking over smaller studios Black Element Software and Altar Games.

In addition to working on the Arma series, Bohemia Interactive created a flight simulator. In 2011, the title Take On Helicopters was released, where the creators focused on a realistic experience of piloting a helicopter in various transport, rescue and, of course, military missions.

A year later, a significant blow hit the studio, and the general public outside the gaming community learned about its existence for the first time.

Developers behind bars

The Greek police arrested and charged two employees of Bohemka with espionage, who took pictures of military objects on the island of Lemnos.

The pair spent more than four months in a Greek prison. The case swelled into a minor diplomatic crisis, and the news was full of articles about young Czechs with an interest in military technology. They were released on bail only after Czech Prime Minister Petr Nečas and President Václav Klaus interceded for them. They were threatened with twenty years behind bars, and with an appeal to the Greek court, they finally succeeded only after six years and got away with a conditional sentence.

At the time, Bohemka was publishing the game Carrier Command: Gaea Mission, a combination of real-time strategy with a simulation set in space, but her attention was mainly focused on solving the Greek crisis.

Indistinguishable from reality

The next part of Army with serial number three was released in 2013. In addition to improved graphics, the game came with dynamic weather, advanced animation and a revised physics model for vehicles and ballistics.

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Although the title is more than a decade old, its graphics are so good that misinformers are spreading footage of Army 3 on social media and passing it off as real war videos.

In recent years, this has been happening in all major military conflicts, including the war in Ukraine and Israel. Because of this, Bohemia Interactive has set up a direct line with, for example, the main European news agencies Reuters and AFP, which it then helps with the identification of footage.

“Unfortunately, it still happens. We are not happy with this portrayal of conflict and we are doing everything we can to prevent it. But it is partly flattering that they choose our game for this,” Slavomír Pavlíček recently told Forbes.

The studio has already announced that the Arma series will continue with a fourth installment. “But it will take a few more years before the game is ready,” says Pavlíček.

Arma 3, which is more than a decade old, remains among the best-selling titles from Bohemia Interactive, but DayZ, a shooter with a touch of horror, which was released in 2018, is also doing well. This title from developer Dean Hall was originally created as a mod for Arma 2 back in 2012, but became so popular that the company released it as a standalone game.

At the same time, Bohemka also embarked on a project with which she significantly deviated from the previous trajectory full of shooters and war simulations. In 2018, the creative adventure game Ylands was released, targeting a much younger audience, which looks like Minecraft. It was followed by its educational version Ylands EDU, which the company is currently trying to get into Czech primary schools.

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With the educational game, Bohemka also tried to establish itself in the Chinese market, where due to the draconian regulations, it is extremely difficult with its war simulations. The Chinese Tencent, the largest video game company in the world and a strategic partner of Bohemia Interactive with a minority stake from 2021, was supposed to help her with this.

However, the Chinese market is still an outlet of minimal importance for the Czech studio, generating here roughly 2.5 percent to five percent of its sales. The most important market for Bohemka is North America. “We realize forty percent of our income there, followed by Europe, and we manage to develop the market of South America or South Africa,” says Pavlíček.

The priority for the studio is now to switch to the new Enfusion technology. It is the so-called game engine, that is, a kind of foundation of all video games, a set of framework tools and systems that ensure that the game works properly.

Bohemia Interactive built it from the ground up themselves and is rightly proud of it – there are not many video game studios in the world with sufficient know-how to create their own engine for such a complex game. Last year, Bohemka released Arma Reforger, the first game powered by the Enfusion engine.

Video Game Symphonies: A Night with Bohemia Interactive

Well, hold onto your controllers, folks! This evening, the Czech National Symphony Orchestra is tuning up—not for Mozart, not for Beethoven, but for something way cooler: the mesmerizing scores of video games. Yes, you heard me right! We’re talking about music from classics like Arma and DayZ, right in the heart of Prague’s Municipal House. If that doesn’t get your geek heart racing, I don’t know what will!

Now, let’s get to the star of the show: Bohemia Interactive, the biggest Czech video game studio. These are the wizards behind some of the most gripping war simulations out there. They’re celebrating an impressive 25 years in the game industry—no small feat, especially considering the entire business is experiencing a major slowdown. But fear not! Bohemia isn’t seeing red; it’s still riding high, despite not launching a major game in recent years.

Surviving the Storm

It’s almost miraculous how this studio has weathered the storm while others have capsized. Remember, Bohemka began with little more than dreams and a sprinkle of luck. With Marek Španěl and Slavomír Pavlíček at the helm, they’re the guardians of the Czech gaming kingdom—holding a firm grip on 60% of the company, while the remaining 40% has meandered its way into the hands of China’s Tencent. You’ve got to love corporate synergy, right?

Their journey from a meager start to a global powerhouse has been nothing short of cinematic. We’re talking drama, near bankruptcy, Greek prisons (yes, you read that correctly), and even a venture into fighting misinformation online—all in a span of 25 years. Who needs Netflix when Bohemia Interactive’s life story has plot twists that would keep any viewer on the edge of their seat?

Once Upon a Time in Bohemia

Now, let’s rewind back to the late ’90s when the studio released its first side project, a quaint point-and-click adventure that had little to do with military warfare and everything to do with the heart. It was charming! And at that time, quite unexpected for a studio that would later become synonymous with tank simulations. But the little game called Mrázik garnered a bit of fame thanks to some clever marketing. They literally threw it in with game magazines, along with countless pirated copies, and boom! They had an audience.

But it was the turn of events after developing Operation Flashpoint that really sent them flying. Who would’ve thought that a little simulation about a Soviet general attacking a NATO base could catch the eye of a big player like Codemasters? Suddenly, Bohemka wasn’t just a blip on the radar; they were raking in millions and creating something fantastic that players wanted in their living rooms.

The Path of Challenges

Yet, as they say, what goes up must be checked by a publisher’s deadline. Bohemia faced its existential crisis shortly thereafter with Game 2. The team was so enamored with the shine of virtual eyeballs (yes, I’m referring to literal eyeballs) that they lost sight of what mattered: making a playable game! It resulted in a partnership split and financial woes that had them knocking on the doors of bankruptcy faster than you can say “crunch time.” Get it together, guys!

Luckily, a clever pivot brought them back from the brink, focusing on military simulations for defense training. And just like that, they were back on their feet! Who knew that being placed on the precipice of financial ruin could lead to the creation of a whole new company division?

The Heroic Hype of Arma

Fast forward a few years, and we have Arma: Armed Assault taking the gaming scene by storm in 2006. Let’s not sugarcoat it; this series became the lifeblood of the company and proved that Czech studios could compete on a global scale. But hold onto your rifles; this wouldn’t be another “just-for-fun” game. Bohemia capitalized on the creativity of their players by encouraging mods—a brilliant idea that has kept their community thriving with fresh content, much to the delight of dedicated snipers everywhere.

Drama, Espionage, and Misinformation

And of course, who could forget the moment when news of Bohemka’s two developers being arrested in Greece rocked the headlines? “Espionage” sounds like a plot twist straight from a James Bond flick, doesn’t it? Picture it: young game developers, military tech, a Mediterranean prison. Spicy! It had all the elements of a riveting tale that kept the studio’s name buzzing for all the wrong reasons. Thankfully, our heroes were released, but the impact was massive. A tiny studio suddenly became a headline act!

The Future Looks Bright

Now, here we are, the world has changed, but Bohemia Interactive has remained a steadfast name in the industry. With plans for a brand-new installment in the Arma series and a solid grip on next-gen gaming tech, they are definitely on a trajectory for continued success. The world is watching them, and their mixer of exciting titles like Ylands is proof that they’re still innovating and adapting.

So, my friends, as the symphony plays tonight, let’s take a moment to appreciate the journey of Bohemia Interactive. May their music soothe us as we celebrate not just their 25th anniversary but also the transformative power of gaming. Auf Wiedersehen, and may your lag be smooth!

How’s that for a cheeky little presentation? Keep your controllers close and your soundtracks closer! 🎶🎮

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