Quote: Original post by Antheus
According to EA, 80% of money is spent on marketing. Entire development, idea to gold only accounts for 20% of total cost.

I'm sorry but is this really true? Do you have a source on that, because that would be incredible. I know that marketing and general "production" (as distinct from development) costs are expensive but really, 80% of a game's budget?

Quote: Original post by Antheus

Quote: What I'm wondering is what would happen to the "middle-ground" developers and games?

Middle-class, in every meaning of the word, is all but dead.

I'd say it has been dead, but there's a lot of movement int hat direction with things like Steam, XBLA, PSN, and Wii-ware (if not the Wii itself). I think the middle-ground market just started changing radically and a lot of middle-ground developers couldn't adapt and a lot of start-ups and skilled indies are starting to fill that void.

@OP.

Think of it like movies. As the market grows, costs and budget will grow. That's not a bad thing; it's just an evolution of the market that's being adapted to. The reason people are running into problems is because of poor management and poor forecasting. People expected the video game market to continue to grow through the depression, and that killed a lot of people whose budgets quickly dwindled down to bankruptcy.

I expect that both of these problems will work themselves out in the coming years and we'll see huge increases in game budgets or number of games being made on large budgets.

Quote: Original post by Twigletguy
I'm sorry but is this really true? Do you have a source on that, because that would be incredible. I know that marketing and general "production" (as distinct from development) costs are expensive but really, 80% of a game's budget?

MW2. $40-50 mil development, marketing $200 million. EA is the de-facto Big League player.

Other costs. A single L4D marketing campaign cost $10 mil.

There's tons of articles out there.

Now consider that at these prices, the cost of Unreal Engine at ~$500k is just a drop in the bucket, which raises the bar for competition to whole new level, and just means that quality of UE is the zero point, any competitive advantage starts there.

You read numbers like that and it just reinforces the fact that the gaming industry pays way too low in comparison to other industries.

Personally, I think all of this equates to an opening in the market for indie game developers. Low-cost middleware technology is now on the tail of nex-gen and progressing quickly. I think when you pair a high quality rapid-development environment with a talented small development team, much more can be accomplished with much less - which is attractive to some of these sore publishers and allows start-ups to get their feet on the ground.

Quote: Original post by Rydinare
You read numbers like that and it just reinforces the fact that the gaming industry pays way too low in comparison to other industries.

I dont follow you. Why would high money spend on advertising means that the game industry pay less than other industries. Advertisement budget has nothing to do with salaries. You think the movie industry doesnt spend on advertising? What was the advertisement budget on Windows 7 ? They spend on advertising because they get a good return. Advertisement works (sadly, people are easy to influence).

Besides, check the latest Game Developper report. The game industry pays really well for -qualified- people. I myself nearly doubled my revenue when I went from programming robots to programming games.

I dont get why so many people in here are trying to downtalk our industry so much.

Quote: Original post by Steadtler

Quote: Original post by Rydinare
You read numbers like that and it just reinforces the fact that the gaming industry pays way too low in comparison to other industries.

I dont follow you. Why would high money spend on advertising means that the game industry pay less than other industries. Advertisement budget has nothing to do with salaries. You think the movie industry doesnt spend on advertising? What was the advertisement budget on Windows 7 ? They spend on advertising because they get a good return. Advertisement works (sadly, people are easy to influence).

Besides, check the latest Game Developper report. The game industry pays really well for -qualified- people. I myself nearly doubled my revenue when I went from programming robots to programming games.

I dont get why so many people in here are trying to downtalk our industry so much.

Okay, well first, I think you may have read more into my post than what I actually said, so let me elaborate.

I've worked in the gaming industry, so first, I've experienced this before. People are willing to take considerably less to work in a gaming job than other jobs, despite often having more hours. Is this true for every gaming company? Probably not, but has certainly been what I and others have seen.

In my experience, the salary reduction is often anywhere from 10% - 30%. True everywhere? No. But, it is common enough to be noted. This has nothing to do with being qualified, in my experience. Paying well and paying competitively well are two different things. I would say that your success in doubling your salary is not the norm.

As for advertising, it simply follows proportions. If the company is spending only 20% in development, then raising developer salaries 10% is almost negligible. The 10% salary boost would only increase total costs for the project 2%. Simple proportions.

Overall, seeing that so much is being spent on advertising when at many shops, developers are spending most of their lives working through the project and getting paid subpar salaries is kind of disturbing to me.

Quote: Original post by Rydinare
Okay, well first, I think you may have read more into my post than what I actually said, so let me elaborate.

I've worked in the gaming industry, so first, I've experienced this before. People are willing to take considerably less to work in a gaming job than other jobs, despite often having more hours. Is this true for every gaming company? Probably not, but has certainly been what I and others have seen.

In my experience, the salary reduction is often anywhere from 10% - 30%. True everywhere? No. But, it is common enough to be noted. This has nothing to do with being qualified, in my experience. Paying well and paying competitively well are two different things. I would say that your success in doubling your salary is not the norm.

As for advertising, it simply follows proportions. If the company is spending only 20% in development, then raising developer salaries 10% is almost negligible. The 10% salary boost would only increase total costs for the project 2%. Simple proportions.

Overall, seeing that so much is being spent on advertising when at many shops, developers are spending most of their lives working through the project and getting paid subpar salaries is kind of disturbing to me.

Game studios aren't non-profit organizations. Like any business, they'll try to keep their cost as low as possible. If more money spent on advertising brings more revenue than more money spent on salaries, it make sense to spend more on advertising.

I'ld just like to get rid of the old stigma that "game development pays like crap", which isn't true anymore. Average game programmer salary is 80'000$ US, and its much higher with experience. Average Art&Animation is 71'000$ US for a job that doesnt even require a college degree. I dont know a lot of artists outside of game development that earn those numbers.

Quote: Original post by Steadtler
I'ld just like to get rid of the old stigma that "game development pays like crap", which isn't true anymore. Average game programmer salary is 80'000$ US, and its much higher with experience. Average Art&Animation is 71'000$ US for a job that doesnt even require a college degree. I dont know a lot of artists outside of game development that earn those numbers.

Sounds like it's time for me to move to Montreal (or BC for that matter... Ubisoft in Montreal, EA in Vancouver area). [grin]

Not all publishers are willing to throw a 100+ million dollar marketing campaign at a product. MW2 is very much the exception to the norm, there was a segment on GameTrailers which discussed this very issue. From their break down it seems overall most titles spend 30%-40% on marketing (for their total budget calculations), which seems reasonable, compared to the 80% for MW2.

Newer middleware are coming out which are empowering smaller tier developer houses, with technology which only a few years before were well out of their reach.

Intelligent management of your human resources, using experienced people, picking the right middleware, guerrilla/viral marketing and perhaps aggressive out sourcing can significantly reduce game development cost. I've seen bit and pieces done here and there and it does work to reduce the cost, the trick is to do all of those things to reduce cost significantly.

Another way to reduce cost is to amortize technology/people/advertising investment over multiple product cycles or product pipelines, ie (God of War series, Uncharted 1 & 2, Gears of War, Halo, GTA, etc..) But to do that, the game has to be successfully enough to become a franchise.

A newer model is to use DLC, (ie Fallout model) where they don't build a new engine/game each product cycle, but rather build in DLC from the very start and release DLC packs which are significantly less costly to produce (if they build in DLC technology from very start).

-ddn