With layoffs happening at Bioware and now the news that 38 Studios gave everyone the boot, I find myself wondering: Just what is a good launch metric? 3 million is not good. 1.2 million is not good. How about 5? Or is anything short of WoW's double digit millions just not good enough?
It's not an easy question to answer. Obviously, it varies a lot based on the size of production budget. Still, I can't help but feeling like there's a lot of dumbassery going around. If you sell 3 million copies of something, especially something that costs like $50 a pop, how are you losing money? Well, spending it, derp, and I suppose video game production ain't cheap.
It makes me think about movies. Aren't there a whole bunch of movies with ginormous budgets that completely tank and lose money. Yet, you don't hear about huge layoffs at Universal, do you? (It's an honest question, I confess that I don't really know). It seems to me that perhaps video game companies are going about this the wrong way.
How do movies work? Don't they secure a whole bunch of financing and then create a specific subsidiary company to produce the movie? Contracts are signed, people get paid (a lot in some cases), and the movie gets made. If it tanks, the smaller company files for bankruptcy or something and the big cogs keep on spinning.
Okay, a financial analyst I am not. This is just me spitballing here. I may be completely off base. I'm just saying that perhaps game companies need to shift to a more Hollywood approach. Currently, it feels like gaming companies need to hit a home run on absolutely every release. That's a horrible way to do business. It's just not going to happen. You can execute everything to perfection and still have a flop. Maybe the idea was flawed. Maybe the fickle waves of society have swung in a new direction. It happens.
Not that Hollywood is a bastion of fiscal responsibility or anything. I guess I just feel like, if they can muddle through it, with all the egos and flash, why can't gaming companies? Or maybe the movie studios have all the same problems, they just don't make Internet news as much. I don't know.
Who takes the loss when a movie flops? The stars still get paid, right? Maybe video game developers should have similar contracts where they get paid for the job, then... done. Not salaried, but contract work. I don't know, that probably sucks. As an engineer myself, going from the security of salaried to the rick of contract is rough. However, how much security is there really in the video game industry?
Like I said, this is all just idle, mostly uninformed speculation. I was reading the gaming news and thought about how I've heard of, say, superhero movies with a lot of special effects that brought in $100 million or something... and oh, darn, had a $200 million price tag. By the time those numbers are in... the stars have already been paid and moved on to the next project. You don't hear about people getting laid off. I assume that lawyers just fight it out in the dark of the night or something. (Lawyers are like Batman, is the main point here.)
My point is just that if Hollywood can weather $100's of millions in shortfall, keep producing movies (many of which probably fail), then why can't game companies figure out a sustainable system? Or is my image of Hollywood just overblown and it doesn't really work either?
I guess at the end of the day, I'd be thrilled if a million people are buying my work. Maybe gaming companies should just aim (and budget) lower. I don't know that we're going to see a 10 million subscriber behemoth again (except when Zynga perfects mind-control and puts out Hypnotoadville). I'm okay with a lot of niche 1 million subscriber games done well. How about you?
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