Study: Average dev costs as high as $28m
- Thread starter JPT
- Start date
A more interesting metric would be to see how many games actually make a profit. Average can be so skewed by some very big budget titles. Another thing would be that maybe it is time to have games at different prices. Why $60 across the board and not have a price range like with everything else you buy. Atleast now with Live and PSN that has started a bit with the smaller games and stuff?...
In that recent Onlive video the guy shows some list on how he convinced people like EA to join them and it showed EA only making like $12 per game
I can get a LOT of games for far less then $60. There are dozens of online shops to choose from, for example in the UK (for me, living in Europe). I've got Batman at a 60% discount, Gears 2 is on its way (hopefully isn't lost) at -66% and so on.
You only have to pay full price for the newest games. If it's OK to play something 5-10 months after its release then you will have better and better choices.
On the other hand, you're not going to be able to play with all your friends online by that time if they're into new stuff. But even in that case the higher price is justified by the added value from the multiplayer. I'm seriously tempted to sort out my online stuff for the Reach Beta and subscribe to Live Gold for its release to have coop sessions with my pals (they've played Halo3 that way).
As for the success rate, about 30% of games manages to make a profit.
And the 20-30 million average cost is just marginally effected by the 5-10 (max) tentpole releases per year. In 2009 we had the following extremely expensive games: MW2, KZ2, AC2.
The rest were probably not that much above the average, like RE5, ODST, GH/RB series, GTA episodes, Batman, UC2, Forza3, Bayonetta or Darksiders. And there's probably a zillion of smaller games with "B" budgets that would probably skew the average to the lower end.
You only have to pay full price for the newest games. If it's OK to play something 5-10 months after its release then you will have better and better choices.
On the other hand, you're not going to be able to play with all your friends online by that time if they're into new stuff. But even in that case the higher price is justified by the added value from the multiplayer. I'm seriously tempted to sort out my online stuff for the Reach Beta and subscribe to Live Gold for its release to have coop sessions with my pals (they've played Halo3 that way).
As for the success rate, about 30% of games manages to make a profit.
And the 20-30 million average cost is just marginally effected by the 5-10 (max) tentpole releases per year. In 2009 we had the following extremely expensive games: MW2, KZ2, AC2.
The rest were probably not that much above the average, like RE5, ODST, GH/RB series, GTA episodes, Batman, UC2, Forza3, Bayonetta or Darksiders. And there's probably a zillion of smaller games with "B" budgets that would probably skew the average to the lower end.
So if we assume that the EA 12 USD is correct then we get an idea of sales numbers to break even.
And the budgets mentioned in the article are sort of correct
50M / 12 = 4166666 ~ 4.2M
28M / 12 = 2333333 ~ 2.4M
10M / 12 = 833333 ~ 834k
Man those are some quite steep numbers.....
And the budgets mentioned in the article are sort of correct
50M / 12 = 4166666 ~ 4.2M
28M / 12 = 2333333 ~ 2.4M
10M / 12 = 833333 ~ 834k
Man those are some quite steep numbers.....
I'm intentionally avoiding online play for now as I'm terrified of the amount of time I could sink into it Things will hopefully change in the near future.
And yeah, $12 is far too little, we've settled on $25-35 for the most part. 1 million units sold is generally accepted to be the average break even point, although there's obviously a lot of factors involved (like whether it sells only half the units at full price).
Things will hopefully change in the near future.And yeah, $12 is far too little, we've settled on $25-35 for the most part. 1 million units sold is generally accepted to be the average break even point, although there's obviously a lot of factors involved (like whether it sells only half the units at full price).
Silent_Buddha
Legend
12 USD may be low for a self developed, self published, self sold, digital only version. But otherwise I think 12 USD comes pretty close to what they are making on average once you take into account retailer margins, shipping and handling, packing, replication, etc... Also take into account many retailers don't take direct delivery from publishers but rather goes Publisher - Distributor - Retailer. And additional margins have to be built in for the distributor which has to include additional shipping and handling costs.
And, of course there's no way to determine how much is going to the dev, workers within the publisher itself, marketing budget, etc.
Regards,
SB
And, of course there's no way to determine how much is going to the dev, workers within the publisher itself, marketing budget, etc.
Regards,
SB
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I do that all the time. There are a few releases that I will get on launch day but apart from that most of my games are bought at a far lower price than the standard $60, and since I don't play the multiplayer part I really don't care if the game is not active on Live anymore. Heck even new releases with a abit of luck you can get at good prices. Just preordered Mass Effect 2, the first time ever to preorder a game as it was at a very good price, £29.99 on amazon. But still it is a bit strange how games are targeted for one uniform price, but maybe there is not so much wiggle room in how you develop games, especially ones that are to be released on a dvd.
The risk of increasing the cost of games is that they will soon be priced outside of what could be called an impulse buy range. Of course every one wants more for le$$ and prefereably fr€€, that will not change, but with the generation of gamers getting older and older having jobbs and stuff maybe the price issue might not be as sensitive as it has been...
Silent_Buddha
Legend
I still find it somewhat amazing that something like food, has doubled or tripled in price since the 90's, and yet publishers have still managed to keep games in the 50-70 USD range that they have been since the 80's.
Regards,
SB
Regards,
SB
The market for people who buy games is increasing at a much greater rate than the market of people who eat.
The only reason why game prices haven't increased, I think, is piracy. I remember being surprised the first time I saw the supply and demand curve.
So it says that the average for a single-platform game is $10 million but the average for a multiplatform game is $20-$40 million? I don't get it because how would a port cost as much as building a game from the ground up. Maybe the multiplatform numbers are also counting the marketing budget or something?
That's really sad to read considering how passionate people in this industry are. What about games that break even, do you happen to have some numbers on that?
