[casual_games] selling game online [getting 60-75% from a "publisher"]

[James C. Smith]

I would agree that Greg Costikyan's description of a publishing deal is
accurate.  He is talking about going to a full service publisher who will
provide upfront funding and presumable many services such as testing,
localization, and marketing.  For a service like this, it is reasonable for
a developer to get 30% of whatever the publisher gets as Costikyan suggests
or the 30-40% that James Gwertzman says is common.

 

However, I want to make it clear that there are many other possible types of
distribution deals that are sometimes also referred to as "publishing" but
have very different royalty rates that are more in line with the 60-75% that
Anonymous mentioned and Gwertzman shot down.  Sometimes a developer can fund
development himself and take care of testing and localization, but just
needs help get getting the game on more portals, or doesn't want to deal
with each portals contract.   In cases like this it is very seasonable (and
I believe common) for a developer to receive 60-75% of whatever the
"distributor/agent" is getting.

 

I think this understand of agents is very relevant to Costikyan's
conclusions.  In conclusion point #3 he says "If you can reach any of the
major portals, it's probably worth doing a deal" but goes on to accurately
state that "But in most cases, they're less eager to work with individual
developers, because they have limited business development bandwidth, and
prefer to deal with larger partners".  In conclusion point #5 he says "Deal
with a publisher only if there is really no other choice"

 

I think this leaves the inaccurate impression that to get a deal on some
portals who "limited business development bandwidth" you would have to
settle for the 30% of net deal that he describes as giving the developer ~
$1.26 per game.  This isn't true at all.  There are many companies who will
help you get your game on those portals and give you closer to 75% of what
they get from the portal.  Some people call these guys publishers, some call
them distributors, some call them agents.  The point is,  this is one
possible path for developers that Costikyan doesn't mention and it shouldn't
be confused with the "publishing" deal that Costikyan and Gwertzman are
talking about.

 

James C. Smith

 

-----Original Message-----
From: casual_games-bounces at igda.org [mailto:casual_games-bounces at igda.org]
On Behalf Of James Gwertzman
Sent: Thursday, February 08, 2007 10:37 PM
To: IGDA Casual Games SIG Mailing List
Subject: Re: [casual_games] selling game online



His other numbers, though, are fairly accurate. And as one of the posters
pointed out, the trend these days is not to calculate off of a $20 retail
price point, but more like a blended average of $12-14 based on sales
through volume discount plans such as GamePass or Megapack (on Big Fish
Games).

 

Finally, another poster in there said something like a typical rate through
a publisher is in the range of 60-70% instead of the 30% that Greg quoted. I
put my money with Greg on this one - 30-40% is much more common for a
publishing deal in the casual game space, less in the retail space. If a
small developer can find a publisher who will fund development and do all
sales & marketing & distribution and pay out 60-70% then take it!

 

---------------------------

James Gwertzman

Director of Business Development

PopCap Games, Inc.

+1-206-256-4210


  _____  


From: casual_games-bounces at igda.org [mailto:casual_games-bounces at igda.org]
On Behalf Of James C. Smith
Sent: Thursday, February 08, 2007 4:55 PM
To: 'IGDA Casual Games SIG Mailing List'
Subject: Re: [casual_games] selling game online

 

Let me illustrate what Russell means by "dramatically impacts the 3rd and
4th set of numbers"

 

In Greg's 3rd example he lists a developers share as $4.21 but in reality it
would be $7.41 if you apply the percentages in the correct order and closer
to $7.68 if you use more accurate cost of goods (COGs).

 

Getting $7.68 rather than $4.21 per sale is going to make a big difference
for the developer.  At the risk of confusing things more by introducing
another percentage, I would say that a developer gets 82% more money than
Greg predicted. ;-)

 

James C. Smith

-----Original Message-----
From: casual_games-bounces at igda.org [mailto:casual_games-bounces at igda.org]
On Behalf Of Russell Carroll
Sent: Thursday, February 08, 2007 4:37 PM
To: 'IGDA Casual Games SIG Mailing List'
Subject: Re: [casual_games] selling game online


>From the Reflexive side the numbers are inaccurate.


 

Our affiliate program does not impact the developer share.

 

That fact dramatically impacts the 3rd and 4th set of numbers he has listed
in the article.  Since we are specifically cited as an example of those sets
I would say it brings the numbers into question, though I can't speak to
their accuracy for other portals.

 

I commented the article, using the article's format to give a better
understanding of how an affiliate sale is calculated.  (notably the numbers
aren't exact and his scenario has the developer paying for bandwidth and a
DRM fee, which isn't charged to developers through Reflexive, but they give
a reasonably useful result)

 

Russell Carroll
Director of Marketing
Reflexive Entertainment
(949) 830-1903 x14

 

 


  _____  


From: casual_games-bounces at igda.org [mailto:casual_games-bounces at igda.org]
On Behalf Of Robert Gordon
Sent: Thursday, February 08, 2007 3:41 PM
To: IGDA Casual Games SIG Mailing List
Subject: [casual_games] selling game online

Hey gang,

Very interesting post from Greg Costikyan today wrt the economics of selling
games online:

http://www.costik.com/weblog/2007/02/economics-of-selling-games-online.html

Lots of numbers in there (most than are usually revealed). Would be VERY
curious to hear from some folks on this. Are these numbers valid? How do
most (successful) developers really operate?

Best,

r o b



| Robert Gordon

| The Article 19 Group Inc.

| phone: 514.938.8512

| email: rob at article19.com

| http://www.article19.com


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