KingsGambit said:
That's precisely the point he's making, while highlighting the folly of the practise. Studios shouldn't be making games if each will "make or break" them.
Depends on how you define folly. If the estimated risk is losses in the 100 million dollars range and the potential profit is in the realm of 200 million dollars and up to over a billion, and the success rate is somewhere around 70% or 80% is it worth the risk? We should keep in mind that it is pretty rare that a AAA game outright fails to recoup its expenses, even "failures" like Dead Space 3 actually turned a profit, if a very small one.
KingsGambit said:
I had the opportunity, several times actually, to listen to
David Joseph speak. Head of Universal Music UK, he's the most influential figure in the British music industry bar none (and that includes Simon Cowell). He had a lot interesting things to say, but the most relevant to this discussion is that he highlighted that no matter what his own musical preference, no matter his company's successes, the most important thing to running a record company was to have a variety of acts in every genre. For every Lady Gaga, he has a guy who plays folk tunes on a violin. He has Mumford and Sons, and Eminem. They do pop, motown, rap, rock, folk, ballads, country, you name it.
The two don't compare though. A record label runs on a different logic from a game publisher and in a different market. Having Lady GaGa on the label while also recording some Irish Folk music isn't mutually exclusive and keeping a lot of small and medium artists with low upkeep on the label is sound business practice when you running expenses for recording studios, album mixers and other people that are not the artists themselves but are needed to get discs (or sound files today) to the audience. EA rarely has the issue that they have 200 computers and an office space standing vacant waiting for developers to get on a project, which would be the equivalent to booking recording studios to capacity. The recording and mixing staff can be on many projects at once and their work on albums are measured in days or weeks. The coders and artists of a computer game can only work one game at a time and their work on a game is measured in years.
KingsGambit said:
Dropping 100mill on one game that flops and kills a studio is a stupid business model. Games are focus tested into oblivion, removing all sense of personality and creativity in order to appeal to the "mass market" and lowest common denominator. These aren't the games people remember.
Whether a game has artistic merit is irrelevant to its business merit.
KingsGambit said:
They could make 3x 30mill games and be happy with smaller returns, instead of having hit, fail, hit, fail, live service and shutting the studios that can't deliver.
As I outlined in my previous posts, they really can't. The current video game market basically has the niches of Indie (1-10 USD), Premium Indie (10-30 USD), Niche A-AA games (30-40 USD) and triple AAA (60 USD). The niche games that costs 30mn USD are already cornered by publishers like Paradox and Deep Silver and these are still insanely risky projects. If you put 30mn USD into a game with a 30 USD price tag you need to move somewhere in the region of 1,5-2 million copies to break even. For comparison, Paradox grand strategy games are projected to sell about 1 million units each. So these are still risky investment at that price point. 15mn USD (if we assume a game sold more then zero) might not be a massive dent in EA's coffers, but the developer is still in dire straits if they keep making losses.
KingsGambit said:
Chasing trends, gambling with studios existence and their employees jobs, employee well-being with crunch-culture, it's an awful business model and not sustainable. The PS2 is the best-console-of-all-time because it had such a huge library of varied games, unrivalled by any platform before or since, the majority of which were from the AA space.
Yeah, but the AA space no longer exists since the market (that's slang for "we who buy games") was massively in favor of AAA games over AA games when they hit the same price point. Back then moving a few hundred thousand units could get you return on investment because the development costs for AA games ranged in the low millions while the price point is the same as today. But when development costs balloon and price points don't move and AA games aren't getting the same increase in sales as AAA games get from the influx of people buying games, AA games are not looking so peachy as investments.
One can argue over whether the focus on big budget, high risk projects is sustainable, but so far the major developers seem to have it down pretty good (not counting Activision as of late), with both EA and Ubisoft managing several high profile annual releases that are expensive to make but also see good return on investment. It should be remembered that when Battlefront 2 and Battlefield V "under performed" they were still making profit for EA and games that we gamers consider failures, like DA:I and Destiny 1, were also profitable if not immensely so.
Finally, keep in mind that crunch time has nothing to do with the business model of high risk/high reward investments, but is an industry wide problem related to generally poor working conditions for game developers, irregardless of the size of the studio or publisher.
