Cost headache for game developers

BBC News, Thursday, 27 December 2007 - by Yo Takatsuki:

Next-generation consoles have wowed gamers with breathtaking graphics, surround sound and stunning gameplay since coming on to the market in the past year.

Cutting-edge video games might be a dream come true for consumers around the world, but for many companies developing them, it's been a nightmare.

The movie-like productions on Sony's Playstation 3 and Microsoft's Xbox 360 games have meant that the cost of producing them has risen sharply.

Back in 1982, the Japanese company Namco produced Pacman for $100,000. Now, the average Playstation 3 title is estimated to cost $15 million.

With profit margins so tight, the line between survival and failure can rest on the sales from just one Christmas. The fear is that many companies will simply not survive the festive period.

[felman87]

probably the biggest reason why we won't see an Xbox 720 or PS4 in 5 years.

[Real Gambler]

It cost the same to make a game for the PC or a console. On the other side, they don't make much money of PC game because they are easy to get for "free", and today's trend is that you need a $2000 box to run them. On the other side, they are getting better and better at preventing piracy on consoles. The PS3 is still doing good, and some guys paid dearly for modifying their 360.

Back to the article... Entertainment cost is booming everywhere. It's the cost of doing business. New movies cost have been through the roof. The game industry is not the only one facing that problem. But you can still make some great movies with small budget, and great games as well (look at Everyday Shooter as an example).

Far are the days where you could make a pacman with "sprites" needing no graphic artists, and only a handull of programmers. Doesn't mean the movie or game industry is going down the drain tomorrow though!

[BrianC6234]

I'm fed up with these crybabies. Who cares? So go do something else then. Or keep making PS2 games. That's the way things are. Nobody says these people have to make games.

[Bleucrunch]

So true Brian if your concerned about the money then make ps2 games and shut the hell up.

[Lord_Mike]

They complain and yet they drive ferrari's and lambo's. It's business and that's how it will always be. Also game costs spike $10/20% that should help with the cost.

[Captain Tuttle]

The rising cost of development is the 900 pound gorilla in the room for the industry. I think we'll see even MORE middleware companies springing up and probably less creativity across the board, if that's even possible. Expect more EA type "gaming factories" cranking out mediocre product. Either that or the introduction of the $80-$100 game.

[DrWan]

$100,000 to make Pacman? that seems a bit high..considering it is 1980s as well.

[name]

Sony cut the dev costs down, to around 4 million now. Which is still alot, but at least its not 15 million. lol Perhaps the indie devs can make a bit of cash by producing some psn games. I mean media molucule made ragdoll kung fu and now they're making a huge game like little big planet.

[Captain Tuttle]

Got a link?

[TheMART]

Wishfull thinking???

[LinuxGuru]

Go back into your hole, Mart.

[Liquid Ocelot]

I think this is what name was talking about
http://www.joystiq.com/2007...
http://www.digg.com/playsta...
http://abcnews.go.com/Techn...
i couldn't find the article that was posted here so i hope these links will do.

[Martini]

I would thing a $10K dev kit is the last of your worries if you are thinking about making a game for PS3...

[AAACE5]

Even if sony really did cut the development cost down to 4 million, it doesn't mean anything if consumers aren't buying the games! Especially for a company like Sony, who built their whole reputation on having the most games on their system!

MS and Sony are in the same boat with these systems. They really need to push the games hard. Also, the low(4 million) priced game is probably a game you don't even bother to look at, while the high priced, high profile games like Gears, Uncharted, Halo, Lair, Assassin's Creed, etc. are the games that people spend the most money on.

This is why a lot of developers are merging together. They are working together in order to figure out how to make the games better, and to share the cost with the publisher.

You guys really don't know what you're saying do you? If those developers stick with making ps2 games, it would be bad for these new consoles. How would you feel if all the ps3 or 360 would get is 10 games a year? At this time, all it takes is for a developer to make 1 flop, and they have to close their doors. And then there's fewer games to buy for your next-gen system.

The videogame industry is in a fragile state. It has entered a new playgroung, where the normal rules really don't apply! You will see more mergers, and more studios closing their doors over the next two years because of this!

[Jinxstar]

Everyone wants to be the Alpha Dog. There is only 1 at a time. Be it Ubi soft, Infinity Ward, Rare, Bungie, Insomniac or Naughty Dog... They all make money and seem to do well. Its the cop outs that lose in the end IMHO... The game industry evolves in so many ways all the time. Its pretty chaotic to say the least... Great games bomb while crap games take the prize... It's a big game of Russian roulette sometimes. Commercializing and going above and beyond still count but... Not as much as it used to it seems... I could be way off but this is how I see it.

[PS360WII]

Well this is another reason why DS has so many games. Along with why XBLA and PSN are doing great and soon WiiWare. There are still ways to make games that don't cost 15 million.

Yet if you want to make the Heavenly Sword, Bioshock, and Uncharted type games you need to take a probable hit. As Real Gambler said look at the movie world. Prime example Waterworld. Way over budget and tanked. Just the way it goes sometimes.

[Pika-pie]

Moaning devs again, is this all they do.

Does George Lucas step up and moan about production costs for his latest movies? Did Peter Jackson complain that LOTR cost to much to make. Jeeez.

Things will get cheaper with time.

[LinuxGuru]

exactly.

for people who care passionately about their product....money is no object to them or their company in regards to completing what they started.

Edit**

I will!

*tells what I just said to myself again, considering I'm a stockholder*

Well, let's see....I've got stock in Sony, Apple, Intel, nVidia, aaaaannnnnnnddddd...........um mmmm......oh yes, Garmin as well.

I take plenty of risks, but I have faith in the companies of my choice.

I, for one, am really glad I chose Apple! haha!

Edit*

Regarding your edit...

Never come to me for financial advice.

=D

Anytime, bro

[Captain Tuttle]

Tell that to the stockholders.

Edit:
Above: Remind me to never go to you for financial advice.

Edit again:

Thanks for your honesty. Have a bubble.

[Balance]

so what, what they are complaining about is they spend big bucks on a below average game and lose money. here is an idea,,, make better games. do you think bungie or epic or infitiy ward or bioware are complaining about the high cost of making games,,, no because they spent the bucks and made games that rock and are fun to play and people are buying them. i remember reading somewhere that gears of war cost 12million to make, they sold 5million copies so basic math assuming all 5million bought the $60 version (which didn't happen) thats 300 million. now granted MS got money for publishing it and other hands were in the pot but i would risk to say epic made money on the 12 million investment. even if they sold 1million copies they would have still made money.

if devs don't want to worry about spending 15million to make a game, make a game worth playing,, if you make it they will come.

[AceLuby]

That devs are working w/ new hardware again. Costs for the first PS2 games were also very high w/ marginal gain at best. However, as development improved over time, costs went down and higher profits were made. W/ the first (and second) generation games of these consoles already created the development costs have to go down w/ sequels and new IP's using a similar or the same engine.

[LinuxGuru]

correct.

As aceluby said, this kinda thing happened before, and it's happening again.

Kinda funny how history likes to repeat itself in the gaming industry, no?

[Robearboy]

A decent post with decent news that not full of flame war bull crap! On that subject though, after reading this it makes me wonder how much money was lost when making lair?

[Bullseye]

i find myself torn on this.On the one hand it's hell of a lot of money if a game flops, but on the other hand if you make good innovative games with original....O.K a game that sells lots, then its not a problem,everyone wins.I'm the first to criticise some of the devs, because lets face it,there aren't many poor devs around and they don't always seem to justify their large salaries. Still, it's a funny business and small indies that may have new idea's may get stifled, while large companies like EA can offload the same lack lustre titles year after year.I do agree that game prices have risen more than enough to compensate for higher development costs, but that only helps the big players, not the little guys that can't afford the initial project costs.For all the problems though, i don't see gaming dying a death any time soon.

[kevin1122]

i still find it hard to believe that the dev cost's have gone up so much considering the cost's of some games for ps1 are way more than what some games are now.