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The Business of Game development

Started by April 16, 2009 06:57 AM
26 comments, last by Obscure 15 years, 7 months ago
> If one industry was diffcult to make profit, then move
> to other industry with more opportunity.

That may be true for YOUR company, but you can't generalize to every company in the industry. Some companies will always be better than others at making profits.


> Go google and search "game project break even", you
> will have negative story like this:

You should try "startup failure rate" instead. It gives a broader picture of entrepreneurship across industries. Cross-reference those numbers and I'm convinced you'll find the video game industry is not so different to other industries when it comes to startup failure rate.


If your point is to state that most startups fail, that's fine. In fact you will find a lot more reasons why startups fail than why they succeed in management litterature and on the web. Or talk to any VC for that matter. But to say that this phenomenon is solely found in the video game industry, or worse that there are no profit to be reaped, is a bridge I'm not willing to cross.


-cb
Hi cbenoi1, Thank for sharing your views.

When I said "If one industry was diffcult to make profit, then move to other industry with more opportunity" I am comparing GameDev INDUSTRY with other industries like Oil,Property,Finance,Telco etc.... I am not comparing how well run other game companies as compare to my company. I still think that industries like Oil, Finance etc.. were more profitable than GameDev Industry.

This was a gamedev business so I only look at 'game project break even', I do agreed that startup failure rate was high for all industries.

I never said or suggest that "there are no profit to be reaped". There are still profit to be made, but the profit received at the end of the day, may not justify the risk & effort involved in developing game.

I believe that you sre running your company development game. Would you like to share, for every $1 of capital employed, what is your return?


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> I still think that industries like Oil, Finance etc..
> were more profitable than GameDev Industry.

And what are you comparing your game studio to? Gasoline distributors? Petrochemical transformation complexes? Exploration companies? Oil rig control software companies? Corner stores with gas pumps?

What you are saying in essence is "Gamedev profitability suck, so go to the oil industry'. I'm just curous as how you map the set of competencies that are needed to run a game development studio into - as you pointed out as an example - an 'oil company', whatever that might be.

If we're talking about a business investment in a generalized sense, then I'd suggest you google for "Investment Clock". The best article is obviously from the British publisher "The Economist", a classic that is re-edited almost yearly in their circulation. The net-net is that the economy works in cycles and the industries that go well today may be replaced by another set tomorrow. I don't think that comes as a shock to anybody here.


> the profit received at the end of the day, may not justify
> the risk & effort involved in developing game.

Again, YOUR risk & reward curve and not that of the industry as a whole. Maybe there are statistics about the game development industry's profitability I'm not aware of. If you have a public link, please share it.

-cb
This might be a little off topic but I just wanted to point out the irony on your website... You have a section where it says this:

"but it is easier to make money by selling courses, products or ideas to entrepreneur wannabe."

then right below this you have a link to buy your e-book.

You also tell people not to trust anyone, including yourself... so why would they bother listening any further?

Anyway, I agree with Tom that you just seem to be stirring up trouble and not really offering any solid reasons to back up your claims.

You can fail at any business if you are not good at it. There's no reason to believe that when you fail at something, everyone else will fail at it too.
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Hi Konidias, I do agreed that what you asked was off topic, anyway I am willing to answer your questions. If you have more questions about my website please email me. My website topic and Business of gamedev are totally not related in anyway.

Q1: "but it is easier to make money by selling courses, products or ideas to entrepreneur wannabe." then right below this you have a link to buy your e-book.

Ans1: There was nothing irony, my site do not promise financial freedom or methods to get rich because I never target entrepreneur wannabe in the first place. I target reader that wanted to be more 'street-smart' so that they are less likely to get into disadvantageous position(e.g rip off,cheated).

Q2:You also tell people not to trust anyone, including yourself... so why would they bother listening any further?

Ans2: I am very happy they you ask me this way. This show that you had think for yourself. I hope that all my reader will think like you. If you had already read my ebook, you will know that this advice was to guard against evil religion leaders. There are religion leaders out there are that asked their followers to do evil. There followers blindly obey and never question their leaders instruction, they hurt themselve and hurt others. Example of such leader is Jim Jones.
If all JimJones followers can think like Konidias, then nobody will get hurt/Killed.

one man's meat is another man's poison, it is ok if you think I am trouble maker. We see thing from different point of views.
Hi cbenoi1

You still have not share with me, for every $1 of capital employed, what is your return?

If you are not looking from game-project-owner point of views, you may not see what I see.

Anyway, if you are playing the role of employee or support role, you do not have to take my word seriously. It will not affect you directly.

Only if you are thinking of becoming a game-project-owner, paying for all related cost of making game, then you may want to consider what I said seriously.

Nobody will share their financial(profit/loss)data openly, you may want to talk to as many game-project-owner(those success/Fail) and find out for yourself.

I believe that I am the only ex-Indie gamedevloper that share my past experience openly. People only wanted to hear nice things and will start attacking you if you said something they disliked.

Anyway I wish you all the best in whatever you do.

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Quote: Original post by BigEatSmall
I believe that I am the only ex-Indie gamedevloper that share my past experience openly. People only wanted to hear nice things and will start attacking you if you said something they disliked.

You believe wrongly. Lots of people have shared their bad experiences here on these forums.

To give you the benefit of the doubt for a moment, the problem might be one of mere wording. Maybe you weren't trying to say (A): "indie development is a fool's game; get out while you still can." Maybe you were trying to say (B): "I had a bad experience with indie game development and I'm thinking of getting out and staying out; anybody got some words of wisdom that might convince me not to give up?"

But it sure sounded like you were saying (A), and that's not just saying something unpopular -- them's fightin' words.

-- Tom Sloper -- sloperama.com

Quote: Original post by BigEatSmall
I will like to share my view of game development as a business for startup.

Most games project does not make money and cost of developing games was high. Maybe there are better opportunity else where.

Passion and hobby can put you in this industry for short period of time, but at the end of the day without reasonable income from your game project, everything will come to an end.

What do you guy think ?


To a large extent whenever someone tries to start a business, most friends and families will ask you to avoid simply because there is a huge risk involved and its also one of the toughest jobs out there.

Passion, hobby and meticulous planning can get you to success in the game industry as well. When I was interested in starting a business I spoke to one of the directors I worked with who runs his own business and few questions from him made it pretty clear we were not ready for business. And the advise he gave us was plan meticulously or you are in for disaster.

The more applications I write, more I find out how less I know
Hi Tom, thanks for your reply.

I have never asked peoples to leave this industry, I am just trying to share my pass experience with those Game-Business-owner and at the same time let them share their experience with me. With the exchange here, many could learn from our experiences before investing their money into devloping game.

The only Game-Business-owner who share with me his experience was borngamer.

I hope that whatever I said will not prevent you from becoming a game-business-owner. Although the financial risk is great, if you don't try you will never know the result.



Hi CRACK123, thank for sharing.

It is fortunate that you have mentor who runs his own business giving you advice. I do agreed that if you don't plan you will you are in for disaster.

I had learn one thing the hardway. No matter how you plan it is almost impossible to forcast it. That is number of bugs in your game.

Sometime solving one bug may lead to other bug found. It is also impossible to forcast how long it take to solve your bug problems.




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