[casual_games] Different Payment Models

[John Szeder]

For those of you who may be receiving pitches on the publisher side, I bet
this hurted.

Make a note of this day as "The Day The Developers Added Fifty Smackers To
Teh Game Bidz".

(opening powerpoint as we speak)

-----Original Message-----
From: casual_games-bounces at igda.org [mailto:casual_games-bounces at igda.org]
On Behalf Of James Gwertzman
Sent: Tuesday, October 10, 2006 9:25 PM
To: IGDA Casual Games SIG Mailing List
Subject: RE: [casual_games] Different Payment Models

1) Assuming that these numbers are accurate, the $350MM is end-user
gross revenue, not net revenue. Assume 60% (or more) goes to the
distribution channel, leaving 40% or $140M for publishers. 35% of $140M
= $49M to split among the top 5 games, or $10M each from portal sales.
That might be a tad high, but not an order of magnitude high.

2) $200K for a AAA casual game these days is low. It's not enough to
just look at the dev cost for an individual game (which frankly is
higher than that) but you also have to look at all the prototyping and
games that get cancelled along the way. You're going to see some games
from us later this year that have been in development for close to two
years and cost well north of $200K.

---------------------------
James Gwertzman
Director of Business Development
PopCap Games, Inc.
+1-206-256-4210

-----Original Message-----
From: casual_games-bounces at igda.org
[mailto:casual_games-bounces at igda.org] On Behalf Of Adam Johnston
Sent: Tuesday, October 10, 2006 8:55 PM
To: 'IGDA Casual Games SIG Mailing List'
Subject: RE: [casual_games] Different Payment Models

Oh come on.  35% for top 5 games gives 7% of $350MM/year to each of
them.
That's $50MM each per year.
If we guess that the top games cost $200,000 to produce, then after
giving
$2MM to Oprah and only 40% on development they still have at least $20MM
each to spend.  That's 100 games per year.  Where are they?  What game
did
PopCap produce this year?  We're in October already. Did Tailismania
cost
$20MM?  If PopCap have more than 1 in the top 5 then did Talismania cost
$40MM?

Adam

-----Mensaje original-----
De: casual_games-bounces at igda.org [mailto:casual_games-bounces at igda.org]
En
nombre de Juan Gril
Enviado el: Lunes, 09 de Octubre de 2006 01:14 p.m.
Para: IGDA Casual Games SIG Mailing List
Asunto: Re: [casual_games] Different Payment Models

I'll step forward, as I wrote the presentation that you are mentioning.
The
data is taken from the DFC Intelligence and CGA Casual Games Study.

The report's breakdown was:
Top 5 Games		35%
Top 10 Games		60%
Top 20 Games		75%

Cheers,

Juan


On 10/9/06, Christopher Natsuume <natsuume at boomzap.com> wrote:
>
>
>
>
> First of all - thanks for the great information, James.
>
> As always, you bring some great data to the discussion.
>
>
>
> "But don't use type mythical "80% of the sales coming form 20-30 
> games" as proof that the industry is broken."
>
>
>
> As for my figures, I was recalling a lecture from this year's 
> Causality talk by Pat Wiley and others: "One Billion Dollars"
>
> You can see that slide presentation here:
> http://www.casuality.org/seattle/html/index.htm - the figure I was 
> recalling was on slide 3. "75% of those 350MM are made from the top 20

> games" - I rounded it to 80% and added 10 games (not on purpose, I 
> just incorrectly remembered it that way J).
>
>
>
> But the general gist is still pretty much the same. A 42% distribution

> of income on 20 out of 300+ games a year is one thing. A 75% 
> distribution - that's another. To be fair - they don't have the data 
> you have to back up that assert, so it very well may be incorrect, but

> I would guess it may be that other portals are not seeing as broadly 
> distributed income as on Reflexive. I believe some of the Big Fish 
> people are on this mailing list - maybe they can share where they got
that
data?
>
>
>
> As for your further assessments of % of TV shows/movies/breakfast 
> cereals, I see your point, and I agree that there will always be
winners
and losers.
> But my issue is that movies, breakfast cereal, and TV shows that don't
"hit"
> still make some revenue (they aren't giving away free cereal or 
> advertising space or movie seats) - whereas under a play-then-pay 
> model, a lot of the "filler" product sees essentially no meaningful 
> revenue at all, even though they may be experiencing thousands of 
> downloads.
>
>
>
> That is the part of the model that I see as broken. Not that all games

> should be big winners, but that the losers should have some sort of 
> sliding scale of loss, so that they might recoup a small part of their

> investment and try again. There has always been a market in "direct to

> video" movies, generic breakfast cereals, or late-night-filler cable 
> TV - even B-list budget video games - and they don't make a TON of 
> money, but there is a revenue model that says they CAN make money, if 
> handled correctly. I am wondering how we can create such a model in 
> our industry. Maybe we can't - but I'd like to have the discussion, at
least.
>
>
>
> I am curious what other issues you had with my ideas - as I think your

> deep experience with Reflexive may put you in a much better place to 
> see some of this much more clearly than me. I am sure you have a great

> deal of insight to share on this issue.
>
>
>
> Cheers,
>
> Cn
>
>
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>
>
>
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