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Title: Starting a game development company - would appreciate opinions Post by: Muz on September 29, 2009, 06:53:08 AM Hi everyone, long time TIGS lurker and game developer here. Would like to ask you guys for opinions. I'm thinking of starting off a games company and doing a little market research for this.
Overview The main business would be a light game development business, probably focusing on easier, less risky games like MMORPGs, web browser games, and semi-casual games at first. Later, the plan is to move on to more serious, higher budget games, but that requires money, experience, and good employees. We'd plan to self-publish at first, especially if the starting game is an online game. Side business But in the long run, the money is still in high quality games and that's where we want to go. Since we have a marketing team and manufacturing facilities that's not doing anything while the game's in production, we'd like them to gain experience by publishing independent games. The plan would be to publish independent games for a small fee per unit. If it looks like it has potential, we'd even look into marketing it. Pricing My idea for the pricing would be to make the prices automatically dynamic. The goal would be the assumption that sales are viral; if someone likes a game, he'd tell his friend, and his friends would tell friends. So, pre-ordered versions would be very cheap, almost at a loss, to promote more sales and talk about the game. As sales go up, the price also goes up, and once the game loses popularity, the prices drop, to cater for the type of players who wait for prices to fall before buying. So... any comments on this idea? Title: Re: Starting a game development company - would appreciate opinions Post by: dspencer on September 29, 2009, 07:10:45 AM Are you saying that an MMORPG is a less risky game? Your other examples of less risky games look right, but isn't an MMO a huge investment? I don't know enough about economics to give a good opinion on the rest of the business model. I would be wary of people only buying below a certain threshold, like a dollar. I don't know though. G'luck!
Title: Re: Starting a game development company - would appreciate opinions Post by: Martin 2BAM on September 29, 2009, 07:16:21 AM I believe he means that browser MMORPGs, not the 3D kind.
If not, with a team of 10 people can take years to make a decent 3D MMORPG. Title: Re: Starting a game development company - would appreciate opinions Post by: ஒழுக்கின்மை (Paul Eres) on September 29, 2009, 07:56:36 AM most games don't spread by word of mouth: relying on word of mouth is a *really* bad idea, you should at least plan for some basic marketing effort
Title: Re: Starting a game development company - would appreciate opinions Post by: Craig Stern on September 29, 2009, 08:22:23 AM If your plan is to get into games development because you think it's "where the money is," then my advice is: don't.
Title: Re: Starting a game development company - would appreciate opinions Post by: Muz on September 29, 2009, 09:55:55 PM Yeah, I meant 'browser RPG'. At worst maybe a downloadable multiplayer RPG, something simple to design and code. Extreme prices aren't really a problem, though, there's a minimum and maximum cap on the prices, so you can't really hope/worry about it going up and down too much.
Paul, don't worry, there's going to be some marketing effort. A lot at first really. The plan's sort of to spend quite a bit getting it rolling, but the idea is sort of that marketing dollars would be better spent subsidizing the price. Of course, we're going to tune the game design make it better to spread by word of mouth, like making them more competitive, or some filthy network marketing strategy to give bonus xp to people who invite their friends and such. Makes us stand out from the other producers that force most of the content to be visible from the first 60 minutes of the games. Craig, why not? There's money everywhere, and investors say "games are bigger than Hollywood", but really, I'm in it because it's something I know. In just about any kind of business, you produce a high quality product, and sell it to as many people as possible, for as much profit as possible. You have to have an extra kind of passion to get into something with both high-tech and high artistic value, and try to charge them less for it :P I was also sort of thinking that if it ever goes down to distributing actual CDs, we'd charge less for people living in poorer regions. Because in first world countries, $20 is like two hours pay, but in some other countries, it's like 2 weeks of pay. That's why piracy is rampant in places like China and Southeast Asia, all huge markets, but plenty of people who download a pirated copy and sell it at $3-$8 per game. The music industry made it into these places with lower prices, and I suppose the games industry could do the same. Anyway, I wouldn't really mind heavy criticism if you guys have any. Don't pull any punches, better to get hit by a fact now than after there's some investment in it. Looks like some of you have dipped your feet in the industry and it's interesting to hear opinions ;) Title: Re: Starting a game development company - would appreciate opinions Post by: moi on September 29, 2009, 10:18:59 PM IMO you should make a few small games first. Or get them done if you don't intend to be the worker
It's more difficult than you think. Either you can do the work by yourself OR you'll have to hire some good creator but you'll need money upfront for that. If you have no experience/knowledge and no money then it will be difficult Pricing My idea for the pricing would be to make the prices automatically dynamic. The goal would be the assumption that sales are viral; if someone likes a game, he'd tell his friend, and his friends would tell friends. So, pre-ordered versions would be very cheap, almost at a loss, to promote more sales and talk about the game. As sales go up, the price also goes up, and once the game loses popularity, the prices drop, to cater for the type of players who wait for prices to fall before buying. So... any comments on this idea? People will just stop buying if the price goes up. Title: Re: Starting a game development company - would appreciate opinions Post by: bateleur on September 30, 2009, 06:03:20 AM How you go about a project like this depends a lot on who your team is and what your funding source is.
For example, if you have a team of two programmers and an artist and are self-funding then I recommend you start by producing a small game to make sure you have your working methods and production pipeline set up in an effective way. This at least gives you a chance to publish something before your company folds. (That's not intended as a criticism of your plans, it's a reflection of the proportion of aspiring dev teams who finish at least one game.) On the other hand if you have a team with dead weight like marketing people, designers, producers and so on and are venture capital funded or similar then you'll need to go straight for a fairly ambitious project in order to break even quickly enough. Your "side business" idea suffers from a critical flaw: publishing for indie games is currently free. Offer to publish people's games and you'll likely receive a hostile response from people assuming you're trying to rip them off! Title: Re: Starting a game development company - would appreciate opinions Post by: Muz on September 30, 2009, 09:33:39 AM I planned for the price to go "up" to around $15-$20, still cheaper than most games, and it would still be cheaper than most "cheap games". It'd also show that there's a lot of other people buying it, and that caters for the type of people who actually wait and see how the price is. Besides, if people stop buying, it goes back down.
Heh, bateleur, good point. We were so busy trying to calculate costs for publishing onto CDs, we forgot that it's really free :P I'm sure there's a market for the smaller gamers who don't want to build up a website + security and do their own market research. If anything, it's an excuse for me to produce my own riskier games without getting investors involved in the creative process. It's VC funded, btw, which puts a very heavy demand on growth. So, it's likely to rely on a small, professional team. Title: Re: Starting a game development company - would appreciate opinions Post by: moi on September 30, 2009, 10:47:13 AM I planned for the price to go "up" to around $15-$20, still cheaper than most games, and it would still be cheaper than most "cheap games". It'd also show that there's a lot of other people buying it, and that caters for the type of people who actually wait and see how the price is. Besides, if people stop buying, it goes back down. Yeah but don't underestimate the cheapness of game buyers these days, they will be very vocal if they see price going up.Title: Re: Starting a game development company - would appreciate opinions Post by: Movius on October 01, 2009, 07:48:07 AM Hello, I am a well-paid richman with more money than sense. Suppose I was to sink a large sum of cash into your organisation, convince me that I am not just pissing it into a black hole. Cause thats what it looks like i would be doing at the moment.
Title: Re: Starting a game development company - would appreciate opinions Post by: moi on October 01, 2009, 08:34:29 AM Are you ready to apply boots to the back in order to get things done?
Title: Re: Starting a game development company - would appreciate opinions Post by: Zaratustra on October 01, 2009, 09:29:41 AM Are you going to pay developers in advance? Cause then I'd be interested.
Title: Re: Starting a game development company - would appreciate opinions Post by: obscure on October 01, 2009, 12:54:47 PM Paul, don't worry, there's going to be some marketing effort. A lot at first really. The plan's sort of to spend quite a bit getting it rolling, but the idea is sort of that marketing dollars would be better spent subsidizing the price. Of course, we're going to tune the game design make it better to spread by word of mouth, Not sure I understand this.Paul said "word of mouth isn't enough" You said "Yes, we will spend money on marketing" You said "But we won't spend it on marketing we will spend it subsidizing the price" (huh?!?) You said "and make the game better so it spreads by word of mouth. So you actually said you won't be doing any marketing and will rely on word of mouth. Also how does spending your marketing money on "subsidizing the price" help you. Your game wont sell if no one knows it exists (and if they don't know it exists they can't tell other people about it). You spend money on marketing so people know the game exists, try it and (hopefully) tell others. If you don't spend the money on marketing but instead make the game cheaper (which I am guessing is what you mean) then no one will know it exists. Just making it cheaper won't make knowledge of your game suddenly pop into people's minds. Can you explain what you mean by this? Title: Re: Starting a game development company - would appreciate opinions Post by: ஒழுக்கின்மை (Paul Eres) on October 01, 2009, 01:01:39 PM i think games in the top 1% in terms of polish (note: not gameplay or fun, just polish and graphical presentation) can get buy on word of mouth alone. but even for those it's not a great idea: braid looks fantastic, but jon blow didn't rely on word of mouth, he worked extremely hard to market braid, and that's why it did so well. same thing with world of goo and so on.
the indie games which succeed usually have three factors: marketing, polish, and game quality. and it's multiplicative, not additive. in other words, if you have: 0.0 marketing x 0.4 polish x 1.0 quality the result is 0.0 whereas if you have 0.4 marketing x 0.4 polish x 0.4 quality the result is 0.064 likewise if you have 1 marketing x 1 polish x 0 quality the result is also 0 Title: Re: Starting a game development company - would appreciate opinions Post by: BlueSweatshirt on October 01, 2009, 06:16:11 PM Quote the money is still in high quality games and that's where we want to go. I highly disrecommend making games if you plan on making them just for money. If you're not, more power to you. But it takes serious passion to make a brilliant and memorable game. Just saying. ;) Title: Re: Starting a game development company - would appreciate opinions Post by: Muz on October 02, 2009, 06:59:07 AM Paul, don't worry, there's going to be some marketing effort. A lot at first really. The plan's sort of to spend quite a bit getting it rolling, but the idea is sort of that marketing dollars would be better spent subsidizing the price. Of course, we're going to tune the game design make it better to spread by word of mouth, Not sure I understand this.Paul said "word of mouth isn't enough" You said "Yes, we will spend money on marketing" You said "But we won't spend it on marketing we will spend it subsidizing the price" (huh?!?) You said "and make the game better so it spreads by word of mouth. Can you explain what you mean by this? Hmm.. loosely defined, I'd imagine it to be something like this. Awareness = AS*e^(-C1*e^(-Viralness*C2)) Popularity = Marketing*Polish*Quality Viralness = (Popularity-Marketing*C3)*Sales + (Popularity - Quality/C8)*C9 AS = Available Sales = MarketSize - PreviousSales - Pirated + ReformedPirates Demand = Awareness*exp(-Price/(Wage*ExpectedQuality*C4)) Sales = Demand(1 - Piracy) Piracy = (Awareness-Demand)/(DifficultyToPirate) ExpectedQuality = Popularity - Marketing*C7 Profit = Sales*(Price - Cost) C1,C2,C3,etc are some constants It doesn't fit exactly to the formulas, but the shape is sort of what I'd imagine it to be. I'd draw a graph but I think this explains it a bit better, even though it's harder to visualize. In English, Awareness is capped at the market size, growth is a function of how viral it is. Popularity is like what Paul said. I'm a little wary about where Ninjabread Man fits in there, though :p Viralness is how many spread by word of mouth (likely 1 extra sale per 40 customers) plus the sales from how good it looks, with C8 being how bad reviews are. Demand takes a huge drop with any charge at all, but is dampened by the wage in wherever it's sold. The actual Sales takes into account sales lost to piracy. Piracy is from the people who don't think the game is worth buying, but not lost when they can't actually steal it. tl;dr Using a lower price makes up for it later on. Marketing needs to be high early on to boost sales, but later on it matters less. After a certain point, $1 spent in marketing is better spent for lower pricing. Title: Re: Starting a game development company - would appreciate opinions Post by: ஒழுக்கின்மை (Paul Eres) on October 02, 2009, 07:13:55 AM that principle is true of products which people know about, but indie games which have zero recognition are not going to get any more attention or sales simply by lowering the price. in other words, if only 140 people know of your game, even lowering the price by half won't get you more than a few extra sales. i imagine at least a few thousand people have to know about your game before changes in price have any effect at all.
Title: Re: Starting a game development company - would appreciate opinions Post by: Muz on October 03, 2009, 06:05:21 PM I'd have to disagree with that, because I have a few 'friends' who are 'professional software pirates'. These are the guys who buy a game, crack it, burn the cracked version onto a disc and sell it for $5-$10, even exporting them. According to them, these games sold quite a few copies, even though nobody's ever heard of them.
When you have something that sells for the price of a burger and a movie date, people expect it to be at least as fun, and let's face it, most games don't reach that level. You could argue that $20 provides a week of entertainment, but not much, nothing memorable. When you price at the same price as a burger, it's more likely to be a purchase on impulse. I've seen some completely unknown games selling for $5-$10 on impulse. Trying to make a bigger profit is a real question, though. After all, it takes 2-5 'impulse' purchases to just to cover up for one 'well-thought' purchase. Yet, if there are 4 extra people playing the game, would it mean that they'd invite another four friends? Title: Re: Starting a game development company - would appreciate opinions Post by: ஒழுக்கின்மை (Paul Eres) on October 03, 2009, 06:17:28 PM but in order to sell those copies, they had to put them in stores, right? stores give you an automatic audience of the hundreds of people who pass through it on any given day, that's how people learned of those games. if it's just online, nobody will pass on by and randomly come across it, so the comparison isn't perfect.
also, i thought you posted this topic to get opinions on the subject from people with experience in it? if you're just going to argue against everything they say, what's the point of the topic? Title: Re: Starting a game development company - would appreciate opinions Post by: Jason Bakker on October 03, 2009, 07:00:29 PM I think a lot of the time, planning and formulas regarding getting sales for games start from "having a successful game, how do you then maximize the number of sales." I think what Paul is saying is that you have to start from "having a game that nobody has heard about and nobody cares about, how do you then get it to be successful." It's a much more depressing place to start from, which is probably it's glossed over in the planning phase of many startup indie developers...
But anyway, if you have any brilliant ideas for going from zero to successful, let me in on them okay ;) Title: Re: Starting a game development company - would appreciate opinions Post by: Muz on October 04, 2009, 07:40:38 PM also, i thought you posted this topic to get opinions on the subject from people with experience in it? if you're just going to argue against everything they say, what's the point of the topic? Ah, no offense meant. The reason I started this thread was because of some disagreements with the standard business model, which means I'd disagree with some things from industry experts. I could go to a business consultant, give him a sack of money, and nod to everything he says, even with bits and pieces I disagree with, and feel like I wasted a sack of money. But I think an open discussion and some arguing on both sides is more interesting and helps us understand each other better. Besid I think we're all talking about the same thing when it comes to marketing. Everyone's saying that it has to reach as many people as possible as early as possible. I did gloss over it, because I believe my current team's strength is in marketing, enough to reach a few thousand comfortably. But I did take it into consideration and tweaked the pricing to focus a little more on marketing. I'm still keeping the heavy discount before release, though, mainly to reward the people who have the loyalty to pre-order the game. But back on indie publishing, because it's something I really want to do. The funny thing is everyone agrees that marketing is important, but won't pay someone to do it. So far, the idea has been to 'buy out' something and keep 50-75% of the profits, which seems a bit ludicrous, but they're accepting all the risks involved in it. There's the alternative of leaving part of the risk onto the developer with a very low cut, but that seems like a rip-off. I'm sort of thinking that no profit cut and charging marketing fees would be the best deal for everyone, but I could see people getting worried that we won't do our best if the final sales aren't tied to the fee. What do you guys think? Title: Re: Starting a game development company - would appreciate opinions Post by: obscure on October 05, 2009, 09:25:22 PM I am with Paul on this. Your post just doesn't make sense. No one can pre-order your game if they don't know it exists. Reducing the price of a game that no one knows about wont suddenly make them know about it.
I have and am working with several indie developers and it is brutal how hard it is to raise awareness. It is like trying to push a car up a hill. Once you are at the top and it starts to roll down hill you are sorted but getting to the top in painfully slow - which is why you need to start your marketing efforts early. It is a real catch 22. No one knows about your game so you set up a blog. No one reads it because they don't know you exist - so you send out a press release. Trouble is almost no one publishes it because... 1. They have no idea who you are (and are too busy to go and find out) 2. They have 15 other press releases that day and only time to write about 3 or 4 things - They pick the 3 or 4 things that their readers already know about. Out of a couple of hundred people you email the release too (who you had to spend time tracking down) about 5-10 of them actually publish anything. Most of those are small blogs that have about 50 readers and even if you do manage to get your release/screens/video onto IGN it just gets lost under the weight of CoD4, Halo and GTA. Even when they do the amount of work involved is silly. I recently sent a press release about a game play video to one of the big sites. They didn't post it. Two weeks later followed up with screen shots - they posted those. Contacted the editor to thank them and mentioned that we have a video and would they like to post that. He says yes and his assets database guy contacts me directly - sent him the link and it wasn't posted. So now I have to chase up this guy to try and get him to post the video of a game he hasn't heard of. You can bet if this was GTA 7 or something similar the video would be up within 20 seconds but it isn't - It is an indie game they know almost nothing about and that makes a huge difference when trying to generate any awareness. Title: Re: Starting a game development company - would appreciate opinions Post by: ElGenerator on October 07, 2009, 04:05:28 AM Random thoughts on your posts:
Quote The reason I started this thread was because of some disagreements with the standard business model, which means I'd disagree with some things from industry experts. There is something like a standard business model in the industry? Which one would that be? Publisher advances? Self funding self publishing? There are so many business models out there that I hardly found any standard. Care to elaborate yours? Because I haven't seen any thought on who is going to pay your bills.Quote The main business would be a light game development business, probably focusing on easier, less risky games like MMORPGs, web browser games, and semi-casual games at first. Less risky? LESS FUCKING RISKY? Tell that your VC guy. "High in, High out" is his motto. No risk, no money. If there would be less risk we would all be sitting in money. But the thing more important is: Focus on something. You want to do MMOs? Fine, focus on doing MMOs. Because you know, all successful guys out there did one thing and one thing only: ID focused on 3d shooters, LucasArts focuses on Star Wars games, Ford started with one and one car only in their beginning. I don't say it is bad that you have a vision what your company should be like in some decades but you won't be successful if you don't focus on something. Sounds like a mantra and I don't want to sound smart-alec.Quote My idea for the pricing would be to make the prices automatically dynamic. Groundbreaking. Try telling that your retailer. You know, the guy who owns the physical shelve space. Why should he bother with your -in his eys- stupid price finding, others can do with a fixed price! You are selling your games over the internet so you can always adjust prices? Fine. But you know, that "high demand, high price" schematic only works when there is some kind of shortage, right? Like there is only one gold coin left on mother earth. That is a physical shortage. Why should there be a shortage on virtual goods? I can copy these bytes and voilá, another copy made, no shortage. In short: Why would your customer pay for your freak price finding? Why should he not feel ripped off?Quote That's why piracy is rampant in places like China and Southeast Asia, all huge markets, but plenty of people who download a pirated copy and sell it at $3-$8 per game. The music industry made it into these places with lower prices, and I suppose the games industry could do the same. A large (like 99%) portion of western games never makes it to the Asian market. The ones that actually get released fail terribly. And now don't tell me that Starcraft is huge in Aisa, because it is not. The market over there is A LOT different than the western market. And I am not talking big-eyes-big-boobs different, it is like another dimension. Doesn't mean it cannot be done though.Quote But back on indie publishing, because it's something I really want to do. ... and keep 50-75% of the profits... Finally some focus! Found your niche, check! Found a growing market, check! But srsly.... 50-75% of the profit? You know, there is a reason why everyone (with a sane mind) is trying to avoid publishers like a bad prostitute when planning a start up. Their share is just too freaking high. I can't remember the exact numbers, but it was something around max 50% back in the days (for retail publishers, including everything from marketing to shelve space). Ask yourself: Can any indie developer afford to loose 50% of their profit? Why should they give YOU their previous money?Lunch is calling... :D Title: Re: Starting a game development company - would appreciate opinions Post by: ஒழுக்கின்மை (Paul Eres) on October 07, 2009, 04:24:15 AM starcraft *is* huge in asia, although it's also heavily pirated (especially in china).
but i agree that there's no standard business model when it comes to small-scale game development. so it seems weird of him to just disregard what people with experience are recommending. it's not like there is zero truth in what he's saying. for instance, i recently had a sale of immortal defense for $3 and sold as many copies of it as it sold in the previous two years. so reducing the price can and does have a big impact. but it wouldn't have sold those copies if it hadn't spent those two years gathering up fans and reviews and so on, because it was those fans and reviews that allowed those people to hear about it when the price was reduced. i think it's just that everyone thinks they know everything, and they're always wrong. Title: Re: Starting a game development company - would appreciate opinions Post by: Muz on October 08, 2009, 12:44:37 AM Heh, it seems that this thread is reaching that point where people stop reading the post, and start reading the replies to posts and the replies to replies and things starts to get out of context. I'm not really eager to rephrase things and justify stuff, so let's leave it at that :/
I've found most of what I'm looking for, and a lot I didn't expect. The marketing thing took me by surprise. Of course we have to spend a few thousand marketing to customers, but what I've realized from TIGSource is that indie developers won't go with a publisher that doesn't have a good reputation. That nearly doubles the worth of marketing. Another interesting thing is that games do spread by word-of-mouth. Going from posted figure (http://i262.photobucket.com/albums/ii89/smuz86/viralness.png)s on certain Facebook apps that don't advertise at all, it seems to reach peak growth at about 5 months, then increases slowly, but steadily later on, reaching a cap of 2.5M in 12 months. This is of course, from a (not very interesting) free-to-play-pay-for-less-grinding game that's designed to go viral. However, awareness doesn't mean sales, and it's still risky to rely on it. I'm still skeptical of the game industry's approach to price, mainly because of the reasons people choose a price. I believe there's a better pricing model, with higher profit, more sales, but we'll just see whether or not it works ;) Thanks again for the comments. Let's see how this goes. I'll still be making freeware in whatever free time I have left, so things are not all about business :) Title: Re: Starting a game development company - would appreciate opinions Post by: ஒழுக்கின்மை (Paul Eres) on October 08, 2009, 07:58:04 AM it's good to be skeptical and experimental, just don't let your theories cause data misinterpretation (although that's hard to avoid for anyone). for instance, there are also a lot of people who believe the price for indie games is far too low right now, and that we should be charging around $30.
spiderweb software charges $30 for every game, and he's been making a living at indie games for 15 years now. so i think both a very low price and 10000s of sales per game and a very high price and 100s of sales per game can work (and both have worked), it depends on the context. so i am wary of just categorically saying that prices are too high or prices are too low, because different prices work for different games and for different people. Title: Re: Starting a game development company - would appreciate opinions Post by: Craig Stern on October 08, 2009, 09:23:59 AM i think it's just that everyone thinks they know everything, and they're always wrong. This is probably my new favorite quote. :D Title: Re: Starting a game development company - would appreciate opinions Post by: ஒழுக்கின்மை (Paul Eres) on October 08, 2009, 09:25:53 AM yeah -- it's just that i've been watching a lot of u.g. krishnamurti this year, so i've come to distrust beliefs in general. as soon as you believe something, you start twisting data to fit the beliefs, it's unavoidable. and it's of course just as true for that belief (data can be twisted to the idea that beliefs lead to the twisting of data)
Title: Re: Starting a game development company - would appreciate opinions Post by: Muz on October 08, 2009, 06:18:02 PM spiderweb software charges $30 for every game, and he's been making a living at indie games for 15 years now. so i think both a very low price and 10000s of sales per game and a very high price and 100s of sales per game can work (and both have worked), it depends on the context. so i am wary of just categorically saying that prices are too high or prices are too low, because different prices work for different games and for different people. Spiderweb Software makes my favorite RPGs. They can claim to make a game with 30 hours of fun and I'd believe them, because the demos alone are that good, and the full games are worth more than a week of fun. I've bought Avernum 1, 2, and 3, and because the full games are worth it, I have a lot of trust in them. Along with Unreal World and Dwarf Fortress, I think they've taken a nearly perfect approach. Spiderweb's got a long track record of making great games and people have a lot of trust in them. With completely unknown games by unknown people, people are going to think many times whether it's worth it. Halving the price halves this reluctance, more marketing makes them trust it more because they hear about it. Both help sales and it's difficult to see which is the better long term solution. In another sense, you have people who pay $30 on Evony before even getting in the real gameplay. And that $30 barely even helps them win. It's hard to put a value on games. An improvement on an existing concept should be worth more in every industry, but it's not. Higher price should make it seem more valuable in theory, but not many say "Hey, Final Fantasy XXI is $95 and Fallout 5 is $75, Final Fantasy must be a better game!" Title: Re: Starting a game development company - would appreciate opinions Post by: Radix on October 08, 2009, 06:31:11 PM Halving the price halves this reluctance Pricing doesn't work that way, muzzlebutt.Title: Re: Starting a game development company - would appreciate opinions Post by: Snakey on October 08, 2009, 09:26:06 PM Reading this thread for quite some time now, and I don't actually understand how this is a game development company. Given that you're only really talking about the publishing side of things, do you plan to actually develop any of your own titles?
I'd recommend not to try to do both at the same time, as you probably don't have the staff or experience to handle two quite different businesses. Given how indie game developers tend to be self sufficient, why would they choose an unknown publisher such as you vs someone that already has a stable audience such as Steam? Title: Re: Starting a game development company - would appreciate opinions Post by: obscure on October 13, 2009, 04:53:18 PM Halving the price halves this reluctance Pricing doesn't work that way, muzzlebutt.Title: Re: Starting a game development company - would appreciate opinions Post by: Brice on October 15, 2009, 08:08:37 AM A lot of products do specials. For example, "$20 for the first 50 purchasers, then it goes up to $40". Valve also does lots of weekend specials on Steam for games, and that helps them test prices.
I agree with Snakey's post: Small companies need to pick their core purpose and dominate it. Don't let "we can do it all!" ego force you to do the manufacturing, marketing, and development (and not be profitable). Decide if you're going to be a publisher or a developer, and then partner with other companies to make it happen. That doesn't sound attractive right away, but it's the safer route in a world where you want to be as safe as possible. Title: Re: Starting a game development company - would appreciate opinions Post by: Muz on October 16, 2009, 05:02:07 AM OK, the business plan has been written up, just in the stages of finalizing. I think I've got a good plan here. We're going to focus on publishing first, just to get the economic aspects right. After all, the reason we're publishing is because there's nobody else out there to do it the way we want to.
On games being viral, you guys were right. Price has very little effect on it. Games do spread by word of mouth, sales are due to word of mouth, but lower prices don't change things. It's surprisingly stable, no matter what people try to do to make a game more viral, the best they can get is to double the rate. The "invite your friends" system Facebook uses is a marketing ploy, it doesn't change the conversion rate. Sales price is still going to go up and down according to a certain factor, which is a core part of the business model. I've nailed down the ideal price for the best income. Funny thing is that I just realized that Big Fish Games sells games at $7, with some at $3. Burger King shovelware sold at $3 and made a hefty profit. Spiderweb Software's pricing system is indeed at the best price for various reasons. I initially thought of lower prices to be the best way to fight piracy, but the damn credit card companies charging more for low prices and extra bandwidth costs from more sales would barely change a thing. IMHO, I'd still prefer to price as low as possible, though. It doesn't hurt anyone, and makes customers happier. I've also noted that the biggest barrier to indie game makers is marketing. That's where my (currently unnamed) company comes in. Here's the final deal:
I think it neatly addresses all the problems. If we suck completely, we won't sell a thing on the site. You don't lose any money and you're free to sell it elsewhere. You don't pay any upfront costs. If you think your game would sell better on Steam or Big Fish, you could do so. If you're worried of us underpricing you, then you can set your own prices and we just sell them at that price. The main flaw I could see from this is that you could tell people to buy it from your site, not ours, and freeload on the free advertising. But if our marketing works, people would be buying it from the site. They won't get the benefit of downloading the full game from our site if they don't buy it there, though. On the pricing system.. a nice little result is that games are priced what they're worth. This rewards people who have confidence in a game and buys it early or sits and waits for the price to drop later. There are people who think that a game less than $20 is garbage. If your game is worth it, then it will eventually go up to $20. If it's really good, and you give people a great demo, it'll go up to $30 or more. Title: Re: Starting a game development company - would appreciate opinions Post by: Alex May on October 16, 2009, 05:14:28 AM Here's the final deal:
You'll have to do better than this. These are significantly less attractive than most other DD services - particularly, the commission. 45% is not competitive. I get that you're doing an economy thing with the price so that's up to you, but the deal should be attractive to devs. If we can't set the price then at least throw us a bit more on (your already noncompetitive) commission seeing as you're taking that executive decision away from us. Also forcing DRM is going to turn some people off, you need to be more flexible and less I'M FUCKING RIGHT, particularly given you've shown several times in this thread you're totally green and started learning the ropes just after you first posted. Title: Re: Starting a game development company - would appreciate opinions Post by: William Broom on October 16, 2009, 05:23:03 AM I'm not in any way an expert on business but it really sounds to me like you are unable to let go of this idea of fluid pricing. What you seem to have said in your latest post is "Yeah, changing the price doesn't actually work, but we're going to do it anyway."
Title: Re: Starting a game development company - would appreciate opinions Post by: Jason Bakker on October 16, 2009, 05:27:11 AM I'd be interested to see you break down your service as compared to Steam, to convince me (as a potential developer selling games on your site) why I should bother!
It might also be a useful way to figure out where you need to be more competitive. For instance, if Steam's userbase at x million is balanced against your userbase of 0, then something (ie. the share you guys take) should probably swing the other way :P Title: Re: Starting a game development company - would appreciate opinions Post by: ஒழுக்கின்மை (Paul Eres) on October 16, 2009, 05:27:57 AM you need to be more flexible and less I'M FUCKING RIGHT that's been the theme for this whole thread. it's funny that he's doing it again after just learning that most of what we said above regarding prices and word of mouth has been true. 45% to host a game and deal with credit card payments isn't competitive with folk like bmt-micro who charge 9.5%. he's absolutely disconnected with the realities of the indie game marketplace. Title: Re: Starting a game development company - would appreciate opinions Post by: deathtotheweird on October 16, 2009, 05:29:46 AM Hey, if you think you can do it-go for it. I'm sure you decided already about that though. it's worth a shot at least, as long as you do not ripoff the developers. But since people can go elsewhere with their games and get a better offer and less risk, I'd say finding competent developers and finding funding is your biggest hurdle. And honestly, the only way I could see you being able to find "game developers" is by finding kids still in college taking game development and design courses. And those are the kids most exploited, and you shouldn't do that. Bad karma.
Also, you shouldn't post this on here. Post it at the Indie Gamer Forum, it deals with more of the business side of indie games. http://forums.indiegamer.com Good luck. Title: Re: Starting a game development company - would appreciate opinions Post by: Radix on October 16, 2009, 07:38:41 PM I hope Muz sticks around and you guys learn to love his oblivious walls of text as much as I do.
Title: Re: Starting a game development company - would appreciate opinions Post by: Muz on October 16, 2009, 08:57:37 PM ...yeah, from what I seeing, I'm saying the exact same things everyone else is saying, yet everyone's assuming that I'm saying the exact opposite. Starting a thread about a business ideas seems to attract flames and a "u dont know what ur doing, noob" attitude. Oh well. :-\
I came here not for business advice, but for an insight of how indie developers think. Nobody was wrong about pricing, it's just that everyone looked at the causes and effects from different perspectives. It is still a gamble, with odds too good to resist. I've tried to make it with absolutely no risk to the developer, marketing benefits, and as much flexibility as possible. I don't see how to sweeten the deal any more. If you have a great game and get it on Steam, great. We could sell some extra copies by getting into the corners which Steam doesn't reach. I'm sure there are going to be a few people willing to try out with us, and if we do a good job, you'd be sure to hear from them ;) Title: Re: Starting a game development company - would appreciate opinions Post by: Alex May on October 17, 2009, 12:40:20 AM You're sure to fail with that attitude.
Title: Re: Starting a game development company - would appreciate opinions Post by: PlayMeTape on October 17, 2009, 01:34:43 AM ...yeah, from what I seeing, I'm saying the exact same things everyone else is saying, yet everyone's assuming that I'm saying the exact opposite. Starting a thread about a business ideas seems to attract flames and a "u dont know what ur doing, noob" attitude. Oh well. :-\ I came here not for business advice, but for an insight of how indie developers think. Nobody was wrong about pricing, it's just that everyone looked at the causes and effects from different perspectives. It is still a gamble, with odds too good to resist. I've tried to make it with absolutely no risk to the developer, marketing benefits, and as much flexibility as possible. I don't see how to sweeten the deal any more. If you have a great game and get it on Steam, great. We could sell some extra copies by getting into the corners which Steam doesn't reach. I'm sure there are going to be a few people willing to try out with us, and if we do a good job, you'd be sure to hear from them ;) Problem is you'll probably pick up the ones that didn't get picked up on Steam because of lack of quality. If you have a choice between Steam and your service the choice is pretty obvious. Title: Re: Starting a game development company - would appreciate opinions Post by: Muz on October 17, 2009, 02:00:12 AM I guess there's not much discussion left on this topic, just argument. It looks like it's on the way to a flame war, so might as well end this.
I thank you all for your opinions. I've taken them into consideration, but in the end, the path is still mine to take. No confirmation that I'll be doing this. I've flitted in and out of game development at least thrice now. It's a sad sign of how the industry is that when you sincerely come down to help someone, they stand ready with pitchforks, immediately assuming that you've come to rip them off. The biggest irony is that it's an industry that's supposed to make people happy. I apologize if I've offended any of you. Thanks again for speaking your mind freely :) |