GAME FIRM FALLS ON WINNING STRATEGY.

Byline: Brent Hopkins Staff Writer

BURBANK - Nine years ago, two haggard men, trying to shop around a shoot-'em-up video game, found themselves thrown out of nearly every software publisher in the business.

Today, joined by a staff that has grown by 79 employees, they will release ``Ratchet & Clank 2: Going Commando,'' one of the year's most anticipated games. Insomniac Games' president and chief executive officer, Ted Price, and vice president of technology, Alex Hastings, didn't figure they'd make it this far, a long way from the days when they hot-bunked, sleeping in shifts in a cramped San Fernando Valley apartment, and stayed up to all hours.

``It's been tricky,'' Price said, reflecting from his modest office. ``We've had to run much more like a business. You go from a bunch of guys who like to make games to a business with millions and millions of dollars of someone else's money thrown at you. You can't screw up, because you'll get crucified.''

Today's release comes on the heels of the original ``Ratchet,'' a space adventure title featuring a furry rocket mechanic and his robot cohort, which has sold two million copies since its release a year ago. While cooking up the sequel, in which the duo goes exploring on an extraterrestrial, commando-style raid, Insomniac has doubled its staff and more than quadrupled the size of its offices. In the team's nine years together, it has come up with a highly successful franchise, ``Spyro the Dragon,'' and sold more than 12 million copies.

Price, a relaxed, lanky man who wears work boots to a job that requires no heavy lifting, didn't figure that the company would enjoy such unusual growth. With a degree in English from Princeton University, he started the company on his own after trying his hand as controller of a medical services company. After several months of trying to teach himself programming, he realized he was in serious trouble.

``I called my mom and told her I needed help,'' he said. ``She said she had ... let's see if I can remember the connection ... a friend whose son was roommates with the most brilliant programmer who ever lived. That was Al. I called him up, gave him this long-winded, rambling speech about what I wanted to do with a company and how I wanted him to join. And all he said was, 'Sounds cool. I'll do it.'''

Hastings joined Price, sleeping on his couch and beginning work on what would one day become ``Disruptor,'' Insomniac's first title. When the duo needed additional expertise, the programmer called his brother Brian, whose last computer experience had been working on pacemakers. The three moved in together, sharing a bed and another sofa, sleeping very little as they tried to crank out the first-person shooter title.

Though the year they spent crunching through the development of ``Disruptor,'' finally released in 1996, didn't go easily, the following years have seemed quite a bit smoother. The title wasn't a huge success - Price says it just broke even - but it taught the fledgling company how to program for the PlayStation. Armed with the knowledge, the company was able to hire two employees and get to work on ``Spyro,'' a kid-oriented tale of a purple dragon. The title sold four million copies after its 1998 debut and spawned two sequels.

It also established Insomniac as a force in the gaming world, known both for the quality of its graphics and the speed of its development. Insomniac made another splash last November with the first ``Ratchet,'' a visually stunning showcase of alien worlds. Though Benjamin Turner, associate PlayStation 2 editor for the Irvine-based enthusiast site GameSpy.com, faulted Insomniac for not innovating enough in its character design, the company's quickness at bringing games to market impressed him.

``They can do things so fast,'' he said. ```Ratchet & Clank 2' was cranked out in less than a year's time, which is amazing. They have a crazy assembly line mentality, so they can get things done.''

Though quick to churn out a product, Insomniac hardly looks like a sweatshop. Whimsically designed, with few interior walls, the darkened offices overflow with science fiction paraphernalia, action figures and stuffed animals. To foster game development, all departments contribute to story ideas, with animators and programmers having equal say in planning.

The games this mentality creates, and the millions of units it sells, have made publisher Sony Computer Entertainment America very satisfied.

``The theme, the tone, and the style is so consistent,'' said Ami Blaire, director of product marketing for SCEA. ``That's a testament to their teamwork, where there's no element of their games that feels like it was done independently.''

In the quality-assurance department, asset manager Carl Grande has logged his share of 18-hour days preparing the Japanese version of the new ``Ratchet.'' The roomful of gamers has searched out flaws in the near-finished product for six months, playing the game every day and suggesting ideas to programmers for future improvements. Though most are pale from hours spent under artificial light, they still seem upbeat.

``I've worked at eight different companies and this is the best,'' Grande said. ``The way we do things, the way every employee has input into the game, it really makes a difference.''

The privately held Insomniac doesn't release sales figures, but Price says revenue has increased each year, which he expects to continue with the well-previewed ``Ratchet'' sequel on shelves. Though dwarfed by developers like Calabasas-based THQ Inc., with more than 700 employees and three titles released this month alone, Insomniac now barely resembles the rough crew of three that first tried to break into the game world.

``It's been a long road,'' Alex Hastings remembered. ``At that point, we didn't know enough about this business to know that it was very unlikely that we'd succeed. We thought it would be very easy.''

Brent Hopkins, [phone]

brent.hopkins(at)dailynews.com

CAPTION(S):

2 photos

Photo:

(1 -- color) Insomniac's president, Ted Price, takes the control on one of the video games the company is designing.

(2) Employee Dena Fitzgerald tests a game at Insomniac's Burbank offices while Ted Price observes.

John McCoy/Staff Photographer