[casual_games] Different Payment Models

[Juan Gril]

Some more clarification :) :

- The DFC report says the market is $350M, but it *INCLUDES*
advertising and subscriptions. Downloads is 135M, and subscriptions
are 55M. Let's assume for a moment that those subscriptions are based
on the RealArcade model for this calculation. So we have:

gross revenue = 190M
40% for developers and publishers = 76M
Top 20 taking 75% = 57M
Remainder for the rest = 19M
Number of games released in Big Fish games per year: 365

I'm using Big Fish title release numbers because they are the ones
with most releases per year, and very rarely you'll see a downloadable
game in other portals which has not been released by BF.

Making an average of rev per title is a wrong calculation because as
Pat well put it during the ONE BILLION DOLLARS! presentation at
Casuality: "Some titles are up for a day, and some are even up for
some hours". And you also have to account the money publishers are
getting, as many of their titles don't reach the top 20.

And that's the main message I wanted to say during the OBD
presentation. Yes, numbers are increasing, but your chance of getting
decent money are slim if your game is mediocre (heck, I know people
who have gotten 20 dollars checks from portals). Innovate, don't
release crap, and you will have a better chance of reaching the top
20. If not, the only ones benefitting are portals keeping traffic up
with free games (free for them and the consumer).

The other part of the presentation was how to manage your budget
effectively, with examples. I'm working on a new presentation related
to "effective and affordable" production, but feel free to email me
privately if there are specific topics you are interested in.

Cheers,

Juan





On 10/10/06, Adam Johnston <adam at bamtang.com> wrote:
> 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
> >
> >
> > _______________________________________________
> > Casual_Games mailing list
> > Casual_Games at igda.org
> > http://seven.pairlist.net/mailman/listinfo/casual_games
> >
> >
> >
> _______________________________________________
> Casual_Games mailing list
> Casual_Games at igda.org
> http://seven.pairlist.net/mailman/listinfo/casual_games
>
> _______________________________________________
> Casual_Games mailing list
> Casual_Games at igda.org
> http://seven.pairlist.net/mailman/listinfo/casual_games
>
>