I worked on a game that sold three times that and never saw one.
The parent company was 'retooling the royalty structure' for well over a year, even had people come from corporate to tell us the progress of said monetary division. Meanwhile we worked a forced six month crunch, 5-6 days a week - most of those twelve hour days, on the first game and were in the middle of the same for the rushed out sequel.
Said parent company no longer exists.
*Just as an aside, during said royalty meeting they made note of how the money they were spending on food each night was being deducted from our eventual royalties. :)
It's not on the same scale, but I recently left a company. Part of the reason is we got a talking to for expensing a $19/person lunch that was apparently over the $15/person maximum... when we went out to eat on a Saturday that I spent 9 hours at the office. I was just stunned the company wanted to bitch about $4 when I gave them 9 hours of my Saturday. This was far from the only reason I left, but it left me feeling very unappreciated.
I've also had this pleasure. The, we bought you a five dollar meal, now 'please' work until 10PM (or later).
Instead of OT your hourly rate goes to $1.25/hr and your quality of life goes out the door as you amass weight and no time for yourself, or activity. My first year in the industry I gained (no exaggeration) 50lbs.
Funny part of this story, because I refused to eat the meals served for the team, and went out for something more healthy, I was ostracized at the above company.
Long ago I found myself working every weekend at a new job - a place which subjected me to hours of grilling interviews by multiple people.
I got hurt in training one evening, came to work the next day and scheduled less than half a day off to see a doctor the following week.
I was told after the fact that I would have to take 'leave without pay' for the time - despite working 50+ hours for the week.
If not for certain obligations I'd have lost it on the spot. I ended up leaving soon after for a far better deal.
I took that whole experience as a valuable lesson in self-worth, the value of my time and how to treat interviewing and employers in the future - as an equal.
Reminds of Zynga trying to bully/steal the equity back from employees. I think MBA types just don't consider developers to be equals (is "line value generation resources" the right term ?).
You're lying. As an MBA, you're considering a VC round to fund a corporation which would attempt to file a class action lawsuit on behalf of all MBAs against people slandering MBAs. Getting an MBA is like gaining vampirism - you need to drain human blood just to stay alive.
I was responding to a comment that was humorously self-deprecating, and I thought my response's satiric tone was clear.
I'm sorry if you or anyone else perceived it as a personal attack.
Also, it's a personal attack to satirically compare someone to a vampire, but it's okay to compare someone to a lamprey? Is there some list of blood-sucking creatures I can refer to, which indicates which ones you will consider a personal attack, and which ones you will not? Mosquitoes? Ticks? Patent trolls? :-)
Sadly, there are enough comments on Hacker News that say such things and mean them that I could not tell that yours was satire. Sorry for misunderstanding.
Is satire allowed? Sure, of course. But fluff humor tends to get downvoted, since it mostly leads to more fluff humor, which takes threads off topic. Fluff humor isn't bad in itself, but it's bad when it obscures high-quality content.
Thank you on all points, and I agree with what you've said.
I kind of wish I had a "parenthetical comment" option. "This is not on topic, but if someone else feels like looking into the parentheticals, they can turn them on."
Then again, isn't that what reddit was invented for? :-)
As someone who deeply appreciates the work 'dang is doing trying to maintain civility on the site and thinks the site is drastically better now that moderation has a public face and improved transparency: maybe you can find a better way to discuss what he's doing than saying "get a grip". Reading horrible, mean-spirited comments day-in and day-out must be the shittiest part of that job. I can't fathom a reason why anyone would want to make the job shittier.
I must protest, because there's a serious point here. Satire aside, it's not ok to say things like "You're lying" on Hacker News. There are civil ways to make any such point. If people break the HN guidelines egregiously, it's not overreacting for a moderator to say so.
The satire thing is a separate issue. To anyone who reads as many toxic HN comments as I do, the satire in that comment was anything but obvious. It's not even close to the worst stuff HN users say to each other.
The implication in your comment and the root comment is that moderators shouldn't make mistakes. That's too high a bar. We make mistakes all the time. That's why I picked this username!
The serious point that lately seems to be frequently missed is that people communicate in different ways. Some use satire, some use brevity, some use example, some use beat-them-into-submission verbosity, but some use counter example, some play at ludicity, some only elocute in jargon, some lay on the sesquipedalian, and some simply quip. The benefit of the doubt or the long pause goes a long way to healthy and interesting conversation.
I didn't (and wouldn't) chastise anyone for satire. I wonder if you perhaps read these comments in the wrong order, or didn't see them all before you posted this?
Close. MBA types consider MBA types who make more money than they do to be their equals. Therefore, the only way for two MBA types to consider each other equals is for them each to believe that the other makes more money.
"This is a ruthless world and one must be ruthless to cope with it." Charlie Chaplin
Ruthless does not mean amoral. And amoung the philisophically iliterate "How to Make Friends and Influence People" can amount to nothing more then patronage and polite cover for knives.
Carry your stick publicly if you want your opponent to be forced into showing their nature. The just ruthless are comfortable in the light of scruteny. They are comfortable with accountability and will stand for their actions.
It is never just business. It is the definition of a social order and cowards love to cover themselves in niceties.
Isn't this a bit apples to oranges? I have to read between the lines since you're not being clear, but you sound like you're talking about your personal royalties. It sounds like your "parent company" was your publisher. So basically: they didn't profit share?
In the case of Oddworld, they had a publisher. They were given an advance or budget to make the game. There was likely some royalty structure in place for revenue exceeding cost. Sounds like the costs were trumped up to avoid paying royalties.
The difference would be that Oddworld had a business contract stipulating this royalty structure. Did you have a contract stipulating profit sharing?
royalties are your profit sharing agreement basically. you get paid a salary(which might be less than normal because you are banking on the project to be a hit and receive royalties) and then a certain percentage of the sales of the game. A bonus is like a "hey we did well so here is a certain amount of money at the end of the year."
The music industry also has royalties on how much a song is played and how many copies of the albums are sold. It's frequently gamed by the studios to pay very little by citing "costs associated with the distribution and recording".
I worked all the overtime essentially for free. They would serve meals, but after a while I chose not to eat them, as I wanted to eat better than greasy tacos served out of a tub or cheesy pizza.
This is the harsh reality for most independent game development teams, except for a few super-star-teams which are able to negotiate non-cut-throat contracts. The publisher pays production cost in advance, and recoups production + marketing cost before the developer sees any royalties, which means the developer can be happy to cover their costs during production and are then suddenly cut off once the game is finished. New money only comes in after the next deal has been signed or when the last game becomes an unexpected break-out hit and earns much more money then forecast (which is very unlikely). If the team can't land a new project for 2 or 3 months it's usually over. It was always hard for independent teams but since about 2009 it's a massacre.
Luckily, with the advent of digital downloads, publishers no longer provide too much value. They don't own the channel. For example, a copy of FTL costs $9.99, and I'd be surprised if the FTL team doesn't earn at least $7 of that $9.99, if not much more.
"The publisher pays production cost in advance" - The publisher is paying the salaries of the developers while the develop. Digital downloads don't help change that equation. Crowdfunding could.
I'd submit that's the wrong tense: Crowdfunding has changed the equation. It may not be done propagating yet, but it definitely has.
Further, the rise of channels where you can recoup the majority of the incoming money is more helpful than this thread has yet shown, I think. When you're making pretty much all the money, you can use the income from your first game to start making a second. If your deal with a publisher was that you could make the first one and are given only just barely enough to survive, you're not making a second one, except of course on the exact same terms, never permitting you enough to leave the plantation (or at least that's the goal).
Of course, you still have to make that first one, but, well, here we run into the cold hard reality that nobody owes a developer the money to make their first game. So, yeah, bootstrapping is going to be hard and take some hustle, but at least the hustle required is now closer to the fundamental amount of hustle required, instead of being artificially added to by a gatekeeper standing in the way. I can't guarantee success, in fact I can offer you "probable failure", but at least now you've got a fair shot.
Crowdfunding seemed like a great solution to the publisher funding model, and it has proven to be a great gain for consumers in some exceptional cases (see: Prison Architect, Kerbal Space Program, Planet Annihilation, etc).
But it's also rightly lost a great deal of consumer confidence now that we're seeing a lot of crowdfunded games burn out, crash, or just plain fail to ship anything resembling the original promise (see: Takedown, H1Z1). The problem is substantial enough that Valve has basically disclaimed their responsibility if an Early Access game just absconds with your money.
IMO the next year or two is going to be critical for crowdfunding. The whole concept launched with great consumer enthusiasm, but that's fading now that the high-profile failures and scams are emerging.
Are we heading into the Trough of Disillusionment [1]? Sure.
Is crowdfunding going to generally succeed in more-or-less the way I outlined? Yes. Even if Kickstarter totally fails, something else will tweak the model until it succeeds. It's just a straight-up simple disintermediation-and-aggregation play; it's virtually impossible that there exist no viable solutions in this space.
Plus it's not the only thing; the more people who start with crowdfunding, the more little companies and groups there are to join if you're not quite ready to take the full risk yourself. And while the Hype Cycle is leading people to Crowd Fund All The Things! right now I fully expect crowdfunding to more frequently be used merely to bootstrap things, or for focused, specific reasons, rather than for everything.
FTL is a bit of an outlier in the sense that they were fully funded. If you're an independent studio without that kind of money, you're still at a publisher (or other financer)'s mercy.
> This is the harsh reality for most independent game development teams, except for a few super-star-teams which are able to negotiate non-cut-throat contracts. The publisher pays production cost in advance, and recoups production + marketing cost before the developer sees any royalties
i don't understand this.
isn't the definition of an "indie developer" a developer without a publisher?
That's why I used "independent developer team" instead of "indie developer". Think Crytek, Crystal Dynamics or Yager. These are all medium sized companies (couple hundred to a thousand people) which are independent from (not owned by) publishers, but still need publishers to finance, market and distribute their projects. This in contrast to DICE or id Software which are no longer independent and now owned by EA and Bethesda.
Oddworld was located here in San Luis Obispo and, back in the day, were known as one of the only large-ish tech/dev companies in town (we have a much better tech/startup ecosystem now).
Our local weekly did a cover story on Oddworld a few years back [0]. It paints a slightly different picture. Stranger’s Wrath was a "commercial flop" and the 5 million games sold was over a span of several years.
I don't know much about the video game industry but I think there's more to it than the Polygon story.
Now fortunately someone told us to do that, and did the same thing, and that's ultimately how we got the company back," he explained. "Because when we were able to prove that things were not what they should be then it was ‘pay us or give us the company back', very simple. And so that's how we got the company back, 100 per cent."
I'm really curious about the full story here. Did they sue a publisher to pay them what they owned and they got paid back in their own stock?
I had a lot of fun playing Munch's oddysee. I really felt sympathetic to the creatures and wanted to help them. I wish they would make more games... I want to return to Oddworld!
Play Stranger's Wrath if you haven't; still my pick for best game that came out on the original Xbox, and there were some fantastic games for that system (eg. Beyond Good and Evil, Psychonauts, GTA: SA, KOTOR, Riddick, Halos).
I'm looking forward to what Oddworld does in the future, though my enthusiasm is tempered by knowing it is difficult to virtually impossible to really recreate the spark of some creative endeavour years later, especially with a different team.
Lorne Lanning (as the public face/'director') is clearly the guy everyone thinks of when it comes to Oddworld, but a lot of the magic of those games was down to the sort of decisions that occur in the seams between technology and micro-gameplay design (how the game "feels" to play second to second), which is a completely overlooked talent (Carmack has this talent in spades, but people generally only pay attention to the hardcore technical stuff) and with Oddworld that was coming from Charles Bloom, AFAICT.
I would, but I'm not a parent so take what I say with a grain of salt. The game is technically in the "shooter" genre but it is very stylized and cartoony, not real-world violence ala Battlefield or Call of Duty or the like
There are always two sides of the medal.
I remember reading article more than 10 years ago about fantasy writer. This guy wrote some story for one of the largest fantasy publishers and he got $2K for it. Deal was made, all good.
It was that until 6 months later when his story turn out to be a hit and the company published it again (they were holding the rights to it).
So this publisher came to those fantasy circles hating on the company why they never sent him a cheque since they made probably millions from it. Even if he said himself they had all the rights to it and he agreed on contract as it was - he still was mad that he didnt got more. Instead of building business relationship, trying to release more stories for better fee he chose to hate on them.
Me myself as indie game developer I wouldn't sign contract that I am not feeling comfortable about.
I am selling all rights to my games to publishers, so I can focus on game development only. If one of the games will become next Angry Birds - oh well, I wont be hating on the company, but I would try to come out with joint deal for sequels.
I understand there could be mistake in accounting, but regarding some comments - publishers are not charity company. They are profit oriented. So if you have in your contract "you get paid $50K for exclusive rights" then you get paid $50K and nothing else.
Suppose I'm a serial killer and I kidnap you. I say "I'm going to be nice today -- I'll let you choose between dying by pistol and dying by machete. If you don't choose I'll think of something worse." You choose pistol. Am I absolved of the murder because I gave you a choice? Of course not.
Choice does not imply lack of coercion.
It is perfectly reasonable to be upset that X forced you to choose bad option Y (e.g. where X is market forces and Y is the combination of a shit salary and no equity).
A pretty vacuous statement. Where they given 5 million or 50 million in advance? Maybe 5 million copies wasn't enough to pay off their advance. I am ready and willing to believe EA is trying to fuck over everyone humanly possible, but what is the whole story? For instance: If they were given 50 million up front and had a royalty rate of 10% and an average sales price of $30 then that would be 15 million dollars no where near the dollar amount to expect a royalty check.
Read the article. He mentions that "someone suggested to them to audit and they found 'Millions and millions of dollars of error not in our favor.'" Shady accounting practices were used to intentionally mask earnings that would've contributed to a real royalty payout.
This is a common practice in Hollywood as well. It's the reason why royalties as a percentage of net profits are called 'monkey points'. It's because you'd have to be a monkey to believe that the studio's accountants would ever allow that film to turn a profit in its official books.
Indeed the publisher model for games was copied straight from Hollywood's playbook, so this link is right on the money.
In general, the accounting system works great if the distributor is also the developer (because tax) but really badly if the developer is external (because "net" is a fiction).
This is also why powerful people negotiate for a percentage of gross vs. net.
It's also how record labels do their accounting (and why most musicians make more money from touring than LP/CD/... sales).
Based on my experience (I was involved in several contract negotiations with major game publishers), of the $40 that the publisher is paid by the retailer for a $60 AAA title before it starts getting discounted, at most $14* goes to the developer (and that assumes you deliver boxed media with instructions, etc.) -- if not the publisher will be happy to deduct those costs from your $14. This is assuming the developer created the entire product on their own dime. If the publisher does QA and packaging, that's coming out of your $14.
* Probably more if you're a Brand Name. I imagine that if you've got brand recognition then, like Alec Guinness in Star Wars, you can negotiate a percentage of gross, and it's a whole different ballgame.
David Prowse has apparently been told that Return of The Jedi has still not made a profit, so he has yet to see any residual payments from it.
“I get these occasional letters from Lucasfilm saying that we regret to inform you that as Return of the Jedi has never gone into profit, we’ve got nothing to send you. Now here we’re talking about one of the biggest releases of all time,” said Prowse. “I don’t want to look like I’m bitching about it,” he said, “but on the other hand, if there’s a pot of gold somewhere that I ought to be having a share of, I would like to see it.”
This is pretty horrific given that we're talking about a guaranteed money-making threequel.
I imagine that, as someone whose face is never visible, Prowse was in an unusually poor negotiating positionand that the more recognizable leads got better deals. Alec Guinness (who got 2% of the gross of the first movie, claimed to have argued in favor of killing off his character to avoid speaking any more terrible lines, and only agreed to do the sequels if he didn't have to promote them) reportedly bought his own island with part of the proceeds (probably in an effort to avoid Star Wars fans).
I did read the article. It didn't mention if they were owed 20 bucks or 2 million. It said EA gave them their company back but there hasn't been a major use of their IP since they went under so obviously EA doesn't think it is worth much. Giving back the company but no cash could be EA saying "yawn we didn't really want it anyway thanks for taking out the trash" or "OMG! we just avoided a serious day in court". I am curious which it is.
"Now fortunately someone told us to do that, and did the same thing, and that's ultimately how we got the company back," he explained. "Because when we were able to prove that things were not what they should be then it was ‘pay us or give us the company back', very simple. And so that's how we got the company back, 100 per cent."
makes it sound like this was not the case and that they were, in fact, cheated out of royalties. The article is not completely clear, though, and awkwardly-worded at some points.
Sure, I was more questioning the amount. Getting the company and all the IP back seems like it would be worth a few million. It just makes me wonder what the real difference in value was.
My understanding (as someone who worked in the Games Industry but not on the financial side) is that the developer normally gets an advance against royalties to finance production, so you're right that they need to earn out the advance before they see further royalties.
The size of that advance will depend on the size of the studio, production costs etc. - it's probably aimed purely to cover costs and the developer won't really make a profit on that - and then any future royalties would go to the developer's coffers.
However, at that point Hollywood Accounting enters the room, and the publisher will do a lot to ensure that most of the 'profit' of the game is actually written off as 'costs' to the publisher, so that they can avoid paying royalties where possible.
This comes to confirm the old statement of those courses you see on airplane magazines: "You don't get what you deserve. You get what you negotiate." (with the slight addition of "... and we can still steal what you negotiate")
Publishers serve mainly as a bank, paying the developer an advance which usually goes 100% into salaries. But traditionally have been doing marketing, and some production tasks like testing or localization, sometimes they have more influence over platform owners (Sony, Microsoft, Nintendo, ...)
Not really. It's a direct remake of a Abe's Oddysee, which was a 2D game. Sure, they could redo it entirely in 3D, and that might have it's own appeal if done well, but it wouldn't really be the same game.
Abe's Oddysee was a brilliantly made 2D platform/puzzle game, and it's gameplay kind of depended on the 2D design. Personally I'm happy see a remake of the game that works the same, but looks nicer. I'd also love to see a new 3D game in the same world, but it would make more sense as a new title.
The parent company was 'retooling the royalty structure' for well over a year, even had people come from corporate to tell us the progress of said monetary division. Meanwhile we worked a forced six month crunch, 5-6 days a week - most of those twelve hour days, on the first game and were in the middle of the same for the rushed out sequel.
Said parent company no longer exists.
*Just as an aside, during said royalty meeting they made note of how the money they were spending on food each night was being deducted from our eventual royalties. :)