Crytek may go bankrupt

Discussion in 'Console Industry' started by fellix, Jun 22, 2014.

  1. Shifty Geezer

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    The devil's in the details and has nothing to do with what company is involved.

    For the Sony rumour, it was about a game with a single source claiming it was cancelled for which a head honcho quickly denied it.

    For Crytek, the rumours suggest unpaid workers, which is very different, and Crytek haven't denied that. They said they are carrying on and had positive buzz around E3, but didn't say, "no, all our employees are being paid on time. We had a glitch one month that delayed payment for a couple of studios that has result in some staff claiming to be unpaid, but other than that, business operations are as usual." When rumours involve unpaid workers, they tend to end with the develop closing from what I recall of similar past rumours.

    Hence the rumours itself is stronger, and an analysis of the situation does make one wonder about Crytek's business strategies. The official response seems to be that they have some cash injection, which in turn doesn't cancel the rumour. It would just means it's right (Crytek in financial difficulties) but they have a solution that isn't bankruptcy (get investment).

    Human beings always believe unsubstantiated rumours/information. Has nothing to do with the internet. Someone tells you a fact, you tend to accept it, which leads to lots of misinformation and the creation of programmes like Mythbusters that frequently disprove everyone's unsubstantiated, assumed knowledge. The internet just accelerates the range and speed of travel of rumours, but the behaviour of the people using it is the same as ever.
     
  2. Cjail

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    Again why should MS studios all drop their own proprietary engines to switch to CE?
    Do MS studios even need CE?
     
  3. Prophecy2k

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    Why totally ignore posts and leaked tesimonies of Crytek employees complaining about missed wages and hinting at issues within the organisation that have dated back from months ago?

    In that regard its nothing like Sony and the Last Guardian.

    That's a pretty weak comparison to make.
     
  4. DieH@rd

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    #84 DieH@rd, Jun 24, 2014
    Last edited by a moderator: Jun 24, 2014
  5. iroboto

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  6. Silent_Buddha

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    Sure, the unpaid workers may indicate something amiss there. But the whole blaming it on the development of Ryse (when they have multiple titles in developement) seems to be entirely jumping to conclusions. Especially, when there is not even a hint of a rumor as to how much they received from Microsoft for exclusivity.

    If EA is to be believed, Titanfall was exclusive to XB1 due to the investment by MS into the project. No other company was willing to pony up enough cash to have the developement of the title finished. I'd imagine Crytek must have received at the very least something similar. Especially as this wasn't a case of MS coming in halfway through the project to save it from being cancelled, but was contracted by MS from the start.

    I suppose the whole "reboot" of the project may indicate some mismanagement issues at Crytek, and maybe they pissed away a lot of the funding that MS provided. I could see that as a potential problem for finishing a project they were contracted to do. At that point though I'm not so sure it would be about Ryse potentially torpedoing their financial fortunes, but the management at Crytek itself. And would point to potentially deeper issues within the company itself.

    Regards,
    SB
     
  7. rokkerkory

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    MS should buy them up?
     
  8. Cjail

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  9. Scott_Arm

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    Sounds like horrible mismanagement. Not sure I'd want to buy them. More likely buy them to get the IP and the talent, then close shop and form a new development group with the best assets.
     
  10. Shifty Geezer

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    That's true, but there's plenty of comments in this very thread doubting that conclusion.
     
  11. Scott_Arm

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    Reading the Kotaku story, it sounds like the company is just run terribly. Better sales for Ryse may have delayed the inevitable results of running a shitty company. I'm not particularly sure sales for Ryse would have been a lot better if it were available on PS4. I'm guessing the people most interested in playing in probably got Xbox One, so you wouldn't have seen sales double by going multiplatform. It would probably be less than that.
     
  12. Gitaroo

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    bet you some chinese companies like the one that bought big chunk of Epic will buy them if they ever go under.
     
  13. Cyan

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    Agreed, and I gotta add that I feel saddened by the news, which I have to say I am not surprised about.

    To me the Cryengine was the alternative to the Unreal engine, which brings me bad memories as an engine -not a big fan of some of the games developed with it, repetitive artwork, etc-, and I haven't seen it succeed.

    Plus, Crytek got mostly famous because how console gamers drooled at Crysis graphics back in 2007.

    Other than that, they haven't made anything specially meaningful, but THANKS to them for letting me play a game in 3D stereoscopic, most others don't even try.

    Ryse is one of those games I like, despite the reviews and I'd want a Ryse 2.

    I just hope this gets sorted out.
     
  14. Shifty Geezer

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    Does anyone have any stories giving insight on what exclusivity deals are like? Is it a case of the platform holder paying all development, getting full pay back up to a certain amount growth, and then the developer getting the rest? Or the console company gets all profits for footing the bill? Or the console company profits shares? Or whatever is negotiated on a per-contract basis?

    Without that info, without knowing what Crytek spent on Ryse and what they stood to make depending on sales, I'm not sure how Ryse can be evaluated. I agree that overall the issues are almost certainly with the management/corporate strategy.
     
  15. dobwal

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    It should also be noted that Ryse's limited success may have discouraged or has delayed MS from commissioning a Ryse 2, which would have had a financial effect on Crytek. A successful Ryse probably would have immediately prompted MS to engaged Crytek for a sequel and led to a fresh cash infusion.

    I think Crytek biggest problem is that it has become a relatively big dev with a relatively thin lineup of past titles. Crytek is basically trying to feed 800 workers with whatever Deep Silver is giving them for deving HF and residual revenue generated from Crysis 3, Ryse and Warface (the only titles Crytek has released in the last 18 months).

    It also seems Crytek is moving in the direction of publishing more of its own titles, which may be a problem because it means bankrolling projects on its own instead of using more traditional outside investment sources.
     
    #95 dobwal, Jun 24, 2014
    Last edited by a moderator: Jun 24, 2014
  16. ERP

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    They are usually much the same as any other deal, you promise to produce a product, there will be payments against some milestone schedule (usually heavily back loaded), those payments will be an advance against some royalty rate. If you never re-coupe the advance, generally you don't have to repay it, though this can be different especially if multiple titles are involved in the contract.

    There is a lot of leeway in negotiation, usually taking less upfront means you can negotiate a better royalty, the publisher might let you retain ownership of the IP if you take less(though this isn't very common anymore) etc etc etc.

    Contract probably contains penalties for being late, marketing guarantees etc.
    The general consensus of those I've spoken to seems to be you sell perhaps 75% of the total units of a cross platform title by going single platform. And you negotiate with that in mind.
     
  17. Rangers

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  18. ToTTenTranz

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    I blame this on the co-founders going stupid and thinking F2P is the future.
    It seems that almost all the employees giving the latest bad reviews in glassdoor have the same opinion. F2P is a worn-out gold rush.

    Unpopular opinion: I enjoyed all their games so far. Crysis 2 got consolitis, hence the smaller environments and limited walking range, but Crysis 3 solved it somewhat. Graphics and gameplay were awesome and I never expected the story to be anything special anyways.
    Had they kept control over the studios' size and just improved their current IPs with iterative sequels, it would probably be a healthy studio today.
     
  19. BRiT

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    Sounds like what they really need is some crysis management.
     
  20. TheAlSpark

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