This is a prime example of the practice of lying with numbers. There are two very basic "cost" graphs which are notably missing from this narrative, and the addition of "bytes" as a major factor in deciding the value of a game to players.
The two missing graphs are: Cost per unit sold, and revenue per unit sold. As basic as these are to any good cost/benefit analysis, their absence indicates that they do not agree with the narrative that the price of games needs to go up; that companies need to milk more money out of their customers.
As for bytes, the presence or absence of bytes has no practical impact on the value of a game to a consumer. If it did, Duke Nukem Forever would be a game worthy of game of the century, whereas Faster Than Light would be forever consigned to the scrapheap.
Perhaps the most telling in this narrative is EA's own comment to investors that shutting down the sale of lootboxes in Battlefront would not result in them losing money. This indicates that retail sales alone were sufficient to offset the cost of development, licensing, and marketing.
</rant>
I also don't condone piracy, but to imply that we should feel sorry for these companies who are barely scraping by is blatantly dishonest. It is especially dishonest when you consider that the bigger publishers (the ones making the outlier games on all of those cost charts) have annual profits in the billions while (oops, rant didn't end) they prey on those susceptible to gambling addictions.
Not everything is a conspiracy. I know the author of this article and he is a straightforward person.
The game industry is a big place with many different kinds of people in it, all of whom have different motivations.
If you build a picture for yourself wherein everyone is That Guy At EA Who Put Loot Boxes Into Battlefront 2, then that picture will probably get in the way of your understanding what everyone is being said by everyone else in the industry who is not that one guy.
This article is targeted primarily at developers, not at gamers. It is an "oh crap what do we do" article, because believe me, that is a big problem and in general we do not know what to do.
This was not some "cost of games need to go up because blah blah" justification article ... it is a straightforward look at what has been happening and some musings about what we can do about it, with "cost of games will probably rise" thrown in as a 6-word aside near the end (at which time he also points out that nobody wants to do this, which is true).
You're reading the article you want to read, not the article that the author wrote.
Motivations and character of the author matter little; the article which was written is pushing an agenda: a justification of (and if not a justification, a recommendation for) the use of what could be seen as questionable practices for reducing costs and getting more money out of their audiences.
What practices do I consider to be questionable?
> "de-emphasize bytes in favor of other types of content"
This, and the rest of the suggestions reads as "don't build a hand-tailored experience, instead build more random permutations of generic content." There's even suggestions to find ways to monetize some of those permutations.
I'll admit it: I'm a gamer, not a professional developer. But these things matter to me. Good, profitable, games do exist - I am playing many of them. What bothers me as a gamer is that all of the suggestions being offered up here will never re-create one of these good games. The games being advocated for describe yet another vehicle for selling lootboxes or skins or weapons.
The whole article closes with the comment "I would love it if these graphs were wrong". Charitably, we can say that the graphs the author displayed are not wrong. However they provide, at a minimum, an incomplete picture. They invite readers to come to a very specific conclusion. That practice is what I'm criticizing with the phrase "lying with numbers" (credit for which goes to "Penn & Teller's Bullshit").
> This, and the rest of the suggestions reads as "don't build a hand-tailored experience, instead build more random permutations of generic content." There's even suggestions to find ways to monetize some of those permutations.
Chess, PUBG, CounterStrike, and soccer fall into this category. It is the art of systemic game design. Saying games should tilt more systemic doesn't mean they get worse. It means they are different.
In the commercial history of the game industry, we've seen entire genres fall out because they stopped making financial sense. Often, they come back later, when the finances make sense again.
I really think you are filtering the entire article through a lens based on your assumption that I am advocating for a world where Uncharted and Edith Finch can't exist, and every game is a lootbox-driven roguelike or something. That world would actually make me very sad.
"Horizon: Zero Dawn", "Final Fantasy 3", "Nier: Automata", "Opus Magnum", "Bastion", "Transistor", "Tomb Raider", "Redout", "Mass Effect", "Hellblade", "Braid", "Divinity 2" ... these do not fall into that category.
Not everyone is driven by competition.
The niches which fell into oblivion were driven there by the fact they are niches - their consumers too small a group to justify the investment. Crafted, story-driven games are not niche. They are not running the razors edge of being barely profitable, instead some are becoming profitable well before they're expected like "Hellblade". They are funding future games like "Bastion". They are being held as the pinnacle of a genre considered to be a dead horse like "Horizon: Zero Dawn".
Whether you're sad or no, the practices advocated by your article doesn't include these games, these experiences. Your comment here even condemns them as not making financial sense, being doomed to only be revisited at some point in the future.
And yet, these games are being released today, are being funded by major and minor publishers and developers alike for tomorrow. That, more than anything else, is a compelling argument for the gameplay you recommend is not the only way forward.
2. I believe you that the author is a straightforward person and I don't think there's anything malicious here. Still, it's not a good dataset. It's 250 data points collected in an ad hoc way. A single decision like "do we include PUBG or not" can sway every statistic in here. So I don't think it's a good idea to make any conclusions based on this data.
If you have a better data set on which to make decisions, feel free to share it. People need to make the best decisions they can with the information available to them.
I'd say PUBG data is much too new, in the timescale this looks at.
I'd be inclined to say "ignore World of Warcraft" in anything like this, because it's the biggest outlier ever (No MMO comes close, even 14 years later) - but at least there's tons of data around it.
> I also don't condone piracy, but to imply that we should feel sorry for these companies who are barely scraping by is blatantly dishonest.
As someone who spent a fair part of my career in gamedev, yes the publishers are taking a large share but the companies that are building the games are barely scraping by.
Most gamedev companies are 2-3 milestone payments away from bankrupcy, which is partially why the publishers have such leverage. Implicitly condoning piracy by saying the publishers make a ton of money still ends up hurting the studios in the process.
That's not what I said - that's not even what I implied. My not "feeling sorry" for publishers or game developers is not the same as condoning piracy implicitly or explicitly.
But since you brought it up, let's go there.
The primary effect of piracy is the loss of sales, which if big enough would naturally lead to the loss of funding for future projects, leading to a studio being closed down. However, very few studios that make big budget games are closing down because of good games failing to become profitable - they're closing down because of politics or they made a game that people don't like.
Even Bioware Montreal, one of the bigger studios attached to a "flop" this past year wasn't closed down because the game resulted in a loss for EA; "Mass Effect: Andromeda" was, per EA, still quite profitable. Instead, Bioware Montreal was closed due to situations largely caused by mis-management (at least, based on what information we have available to us). Most of the developers were even retained.
Smaller, self-published studios would, of course, feel the pinch of piracy more than larger publisher-backed studios. That said, they're also playing in a very crowded pond, and differentiating between a failure caused by piracy and a failure due to an over-saturated market are going to look ridiculously similar. It would take a crystal ball to tell the difference.
Finally, let's be frank: all game developers big and small are affected by piracy, so it's a mostly even playing field on which they are competing. A studio that fails and blames it on piracy is not looking hard enough.
Sorry, there are some rough words there, but I stand by them. I don't condone piracy, but I also accept that it's simply part of the world in which all game developers exist. Reality is not always nice.
> Finally, let's be frank: all game developers big and small are affected by piracy, so it's a mostly even playing field on which they are competing. A studio that fails and blames it on piracy is not looking hard enough.
Except the piracy rates for PC is vastly higher than consoles(by nature of barrier of entry to break modern consoles if nothing else).
Since the majority of Indies publish on PC(or publish there first) it is not a level playing field by any means.
There are few console exclusives these days; most games that come out on the consoles also come out on the PC. A not-insignificant number of these games are even sold on GoG, a place where no DRM is allowed.
The most notable exception to this is the Switch, a platform which has close to 10x the independent content than first party content.
All games that were out on the PC 1-2+ years before they made it over to consoles(and only when they became widely successful). For indies piracy is very much a real problem and one that isn't nearly as level of a playing field.
So quick to claim malice and deception, when the likelier story is that cost/revenue per unit sold isn't public.
I would be hesitant before throwing out accusations and claims so irresponsibly. Have you done any analysis of game size vs. quality? Two outliers does not destroy a trend. There are arguments for it - only bigger teams with more resources will make large games. It would not surprise me if larger games tend to have higher playtime/better reviews. Consider the sea of small, trash games out there.
> their absence indicates that they do not agree with the narrative that the price of games needs to go up
Their absence suggests to me that the writer of the piece didn't have access to that information. Wouldn't you need inside information to come up with those numbers?
Well, here's the writer's own words on that subject:
> Using industry contacts and a bunch of web research, I assembled a data set of over 250 games covering the last several decades.
I would make the reasonable assumption that revenue could be guessed at, if not explicitly uncovered, given the detailed data the author appears to have on the number of sales and costs. Many publishers and dev houses are public companies who release public information about their costs and revenues.
Contacts were far more willing to just share dev cost; I didn't get anywhere near enough figures on revenues that could be tied back to specific titles.
I don't have data on number of sales at all.
Public companies don't break down by title, alas, not customarily.
The fact is, even this data set is highly unusual.
It is ok for companies to earn money. I am enough on the left to want better control over drug prices and to be huge fan of public school systems including college.
Getting angry over game companies wish to be profitable is too much on the left.
This is literally forum for entrepreneurs trying to earn money on whatever. Why should be game expanses expected to not seek profit here is incomprehensible to me.
A good policy, IMO. And even if you know you'll buy the game at launch regardless of the reviews, there's no need to give the publishers your money (or the promise of your money) months in advance; a day or two should suffice.
You don't need any of this. I paid $70 for Final Fantasy 3 on the SNES in the 1990s. The average AAA PS4 game is 59.99 in 2018. Games are one of the few things that not only have not matched inflation, they've gone down despite the sheer amount of people needing to work on them going up.
Anecdata - but I'd say in the SNES there was hardly a game that only provided 10h of linear game play, whereas that's quite a possibility nowadays. (More on PC probably, but I don't think all PS2/3/4 games are created equally). So maybe people wouldn't even buy it at 130$ (first google hit for converting buying power 1990 -> 2018)
This is the key thing. Basically, these curves have been sustainable because of the growth of the total addressable market. But that can't grow exponentially forever.
First, let me state that this is not some sort of apologia for AAA and its business practices. I don't work for an AAA publisher. I don't derive significant annual revenue from AAA. I am currently an independent designer and consultant, but I have worked in PC gaming, MMO, console, mobile, and social web games over the last couple of decades. I have been writing about games and game industry issues for just about all of that time, and in that time have both attacked and defended many different industry practices. Among other things, I've attacked lootboxes, addictive mechanics, and the ethics of game service operators many many times. Your fight is not with me, and impugning my integrity is uncalled for. Skepticism, yes, of course. But there's no need to accuse me of dishonesty.
To address specific points:
Cost to users per unit sold is not graphed, but it's in the dataset. I had to go find it per title by hand. This is pretty easy; the vast majority of the points on the graph are $50 or $60. Free to play games are excluded from the player price paid for MB because there isn't anywhere enough data out there on LTV for F2P titles. MMOs from when they were in the boom period were baselined at $150, which matches my personal industry experience from that time, and is actually probably a little under.
Cost to publishers per unit sold is simply not available. Units sold for most games aren't available, unfortunately.
Revenue per unit sold is even more confidential than dev costs, and I don't have any figures at all for it. It's very rare for it to come out except in segments that use ARPU, and even then ARPU tends to be baselined on per day not lifetime revenue. Investor calls tend to only announce total revenues, not broken out by title.
"Value of game to a consumer" is utterly subjective, of course. I make no pretense at assessing that. You might highly value Mortal Kombat games; I don't tend to like them. I think Edith Finch was one of the best experiences of the year, you might prefer Zelda or Odyssey or Nidhogg 2. At best we could try for something like hours played, but that's an even less available figure.
So yeah... bytes are a very rough proxy, and far from an ideal one. They are just a (perhaps poor) stand-in for work product. They go some ways towards representing the amount of work that goes into a game these days, which unfortunately many game players seem to be unaware of. They are not a perfect proxy by any means. But part of the point in using them is that we can then look at a highly systemic game with low art costs that still did very well (like FTL, around 180MB, as you mention) and see that it is an outlier on the curve.
It is, unfortunately, incorrect that presence of absence of bytes has no value to a consumer. It's certainly not any sort of direct relationship, and it's not universal. But I think it's pretty fair to say that for a content-driven game, bytes are a pretty noticeable value. Graphics; levels and maps; characters and character choices; number of enemies... these are all things that players can and do use to measure the relative merit of content-driven games and we have all seen it. Not a universal, but common enough that it would be foolhardy to completely dismiss it. Byte expenditure is in many cases basically a marketing tool, as it contributes to art direction in particular. Cool visuals get you noticed. Do cool visuals always correlate to high byte count? No, and that would actually be a trend we would (and do) see as developers seek out cheaper yet well art-directed visuals.
As far as EA or other AAA shops. You can actually go look, they have in fact given percentage figures for incremental digital revenue versus retail, in some investor calls. The key thing is mostly that digital revenue is rising year on year. There is absolutely a debate to be had about "what margin should a publisher make" and "how much upselling is appropriate given that I already paid a retail cost." That's not what this article was about, though. I make no pretense to speak about profitability right now in this article. The point of it is the trendlines.
If you don't have costs, do you really have anything resembling an accurate picture of the financial side of the game industry? Cost is pretty much second only to revenue in terms of its necessity to discuss the health of a business.
> bytes are a very rough proxy, and far from an ideal one
I'd go so far as to say it's a useless proxy, frankly. Games in the 80's, 90's, and early 00's were externally limited in the number of bytes that could even be shipped to the customer, so of course it's going to go up with time, even if the effort that goes into producing those bytes were to trend to 0.
> The point of it is the trendlines
So, perhaps we should instead be focusing on how to keep the cost trend-line in line with the available funds trendline, without sacrificing a whole categories of games or finding ways to artificially (and IMO temporarily) increasing the available funds trendline?
After all, to borrow some examples from another thread between us, there are only two successful soccer games at this point in time. Three-ish competitive first person shooters. Two Battle Royale shooters. No real successful chess games (except for Battle Chess. Battle chess rocks). Trying to break into those kinds of long-term entrenched markets is going to be a nightmare, even when you have a good game.
In comparison, how many major contenders for a player's wallet exist for a new choose-your-own-adventure style game? For a open world game with an engaging characters and re-imagined open world tropes? For a new hybrid real time strategy slash turn based strategy game with a kick-ass soundtrack? None. Even the turn-based fantasy RPG market has started to show a vacuum a mere 4 months after the release of "Divinity 2".
Your examples miss my point, which was that some types of games are inherently more expensive to make than others.
Just like some types of games inherently retain better than others, generate more hours played than others, are more competitive than others, appeal to broader audiences than others and so on. They are can all be good games and still vary tremendously in this way.
All I was saying was that therefore the market dynamics will push towards game design approaches that help with the cost problem, and that spells trouble for game design approaches that don't.
To help avoid accusations of not adding anything to the discussion; Jim Sterling is a video games essayist who publishes well researched and presented polemic on the games industry on YouTube.
No, but I'm both flattered and bothered by the comparison. :D
Jim Sterling provides a viewpoint not commonly shared even among some of the more critical video game reviewers (such as that even cosmetic lootboxes are bad for the consumer), and it's provided a few insights I hadn't thought of previously. And yes, the EA quote is also one of his favorites - it is very telling.
He has created hell of a persona - one hell of an offensive persona - but it hides a lot of really useful insight and sly humor.
This is a prime example of the practice of lying with numbers. There are two very basic "cost" graphs which are notably missing from this narrative, and the addition of "bytes" as a major factor in deciding the value of a game to players.
The two missing graphs are: Cost per unit sold, and revenue per unit sold. As basic as these are to any good cost/benefit analysis, their absence indicates that they do not agree with the narrative that the price of games needs to go up; that companies need to milk more money out of their customers.
As for bytes, the presence or absence of bytes has no practical impact on the value of a game to a consumer. If it did, Duke Nukem Forever would be a game worthy of game of the century, whereas Faster Than Light would be forever consigned to the scrapheap.
Perhaps the most telling in this narrative is EA's own comment to investors that shutting down the sale of lootboxes in Battlefront would not result in them losing money. This indicates that retail sales alone were sufficient to offset the cost of development, licensing, and marketing.
</rant>
I also don't condone piracy, but to imply that we should feel sorry for these companies who are barely scraping by is blatantly dishonest. It is especially dishonest when you consider that the bigger publishers (the ones making the outlier games on all of those cost charts) have annual profits in the billions while (oops, rant didn't end) they prey on those susceptible to gambling addictions.