Valve's Newell On Community-Funded Games 176
Modern games are extremely expensive to make. High-profile, AAA titles have budgets in the tens of millions, and even the smaller, independent titles can cost hundreds of thousands of dollars to make. Couple this with development times that frequently reach three or four years and you have publishers who are very shy about investing in new projects, particularly for unproven IPs. Valve co-founder Gabe Newell recently spoke about a new way of funding such games: "There's a huge amount of risk associated with those dollars and decisions have to be incredibly conservative. What I think would be much better would be if the community could finance the games. In other words, 'Hey, I really like this idea you have. I'll be an early investor in that and, as a result, at a later point I may make a return on that product, but I'll also get a copy of that game.'" Such a system would certainly relieve some of the pressure to stick with tried-and-true concepts (and possibly get management to grant a little more leeway with deadlines and resources), and it would make the video game industry more of a meritocracy than it already is.
So... (Score:4, Interesting)
... the real investors won't fund something, and they're expecting to sucker gamers into doing it?
Haha. Good luck.
Legal complications? (Score:1, Interesting)
Unless you are a first class citizen, like Goldman Sachs or a venture fund, investing can get complicated, if not dangerous (swimming with sharks and all that).
Patronage might be simpler for the fourth class people of the world.
PLEASE ALLOW SIX TO EIGHT WEEKS FOR DELIVERY OF YOUR 10x ROI.
SellABand? (Score:4, Interesting)
Looks exactly like the SellABand [sellaband.com] model, but for games.
Actually, I think it makes more sense for games than for music. Studio time may be expensive -- for that matter, so is making a living -- but compare that to the cost of feeding a team of programmers for a year.
Waiting to be modded down by people who know more about music than I do. (No sarcasm there -- this is just armchair speculation. Move along.)
Sure, but... (Score:4, Interesting)
There needs to be some way for people to bail out too. Otherwise there'll be idiots like 3D Realms out there, all too ready to piss away our money on another DNF debacle. Guess what, this is called investment. All the developers have to do is to sell shares in the game. (And yes, this sort of thing does need to be protected by the usual rules for investments.) Of course, there's always a chance that this'll mean that developers get squeezed out of working on their own creations, but if they can't knuckle down and deliver a product, they deserve to get shafted.
Re:Then open it up (Score:4, Interesting)
They certainly do. However, asking people to be venture capitalists for a game project requires a little more in return than just asking them to buy a complete, well tested game that other people have played, reviewed, and said they got something out of. Most venture capitalists would be asking for at least a share of the project's rights (including related trademarks, merchandising, etc), AND its profits.
Re:Then open it up (Score:5, Interesting)
I've been advocating this model for TV shows for a few years. Currently, a group makes a pilot, then tries to sell it to networks, which fund the series. It wouldn't be a massive change to release the pilot publicly and ask people for contributions towards making the full series. Once you've raised enough capital, you start production. You then encourage peer-to-peer distribution of the first season's episodes, because anyone who enjoys watching the show is someone you may be able to get money from to make the next season, or to make your next project. Unlike draconian copyright amendments, this model has the advantage that it funds the really valuable act, that of creating the work, not that of copying it.
The problem with Gabe's idea is that he wants to combine this with the existing model, where you charge for copies. I can't see that working well in the long run, because it limits distribution which makes it harder to get new investors for the second round.
Re:Gamers can be demanding (Score:4, Interesting)
Which are all valid points, if expressed in an immature style that you'd expect from most teenagers.
Another interesting aspect is that, if any contract was involved... would gamers be bound to it, since many are minors? And if no contract is involved... what guarantees would they have?
Re:So... (Score:5, Interesting)
Flip a coin (Score:2, Interesting)
1. Expect a lot of people to pay ~$50 for a game before it's developed.
2. Give these people absolutely no guarantee that the game will ever be produced or that it will be anything like what it was originally billed to be.
3. ???
4. PROFIT!
Seriously though, this just confirms my suspicion that Gabe Newell is completely fucking retarded and has absolutely no sense what so ever. What happens when the budget falls short (not enough investors)? The game isn't produced but the money has already been spent.
Here's a better idea. You want to buy a game, so you go to the store, give the clerk $50, he flips a coin. Heads, you get a game, tails you don't, in either case he keeps your money. This accomplishes exactly the same thing but doesn't involve all this business with investment laws and the FTC.
Requirements? (Score:4, Interesting)
1. Access to a weekly build. I want a full build of the current game status, not a reduced-functionality demo. This is necessary because if game development would stop, I would still have something. The extreme programming technique could be used to reduce the risk of loss in investment.
2. Ability to request changes. If I invest in a game, this should give me a certain degree of voting rights.
3. As long as money is invested in the game, development should continue. When a game developer wants to stop supporting a game, he should stop people from investing in it.
4. Online platform. Ongoing projects should be listed on a service like ebay.
In particular for game topics neglected by the big publishers, this would open up ways for newcoming game developers to implement ideas from and for communities with special interests. While I think this would be a welcome change, many people will prefer buying games without risking loss of investment. If trolls are kept in check, I think the game development process could work in a very open way.
Re:We don't already do this? (Score:5, Interesting)
What won't happen is people pre-ordering games that are purely ideas. If you want investors to put something into your game, it needs to be impressive and exciting.
Actually, we already do this, so it's hardly a revolutionary idea. This is exactly how games are produced for the board wargame market.
A publisher will announce they're planning to make a game, list the major features (setting, operational level, general type, complexity, etc) and ask for preorders. This is usually accompanied by a mockup of the game or some early counter/map graphics, but can also just be an outline. The preorders will typically be at a 30% discount from the final retail price.
As development progresses, more information will be added to the listing. Rules excerpts will go up along with sample games from the playtest reports. Final art for the finished product will be posted as well, since it's something that is typically done early in development. The whole time this is happening, additional preorders will be coming in. Also, the designer will be listening to feedback from the people who have preordered, and possibly adding requested features.
When the number of preorders reach a certain threshold, the game will go onto the schedule to be printed, but will not be published until it is complete. Typically, this will mean several months more of playtesting to tweak the rules for optimal balance. Unlike computer games, there's no releasing a patch for a shoddy wargame. They have to be more or less right the first time. Again, more preorders will be added during these final months.
When the printing date draws near, the publisher will look at the total number of preorders and multiply that to decide how many copies to print, usually times 3-4. The key being that at this point, the number of preorders will allow them to break even on the number of printed copies, even if no further games are sold. Anything sold after the preorders is profit.
And that's how wargames are made.
However there are differences. Wargaming is a smaller hobby, which has well established companies with good reputations, and whose players are intimately familiar with the subject matter. This is why companies are able to make sales based on nothing more than an outline.
Would this work as well in the computer industry? Who knows. Gamers have been burned far too often in the past with pre-rendered screenshots that looked nothing like the actual game, and fly-by-night companies that barely lasted past their ship date. It's even less likely to work on the console market, where sales are driven purely by graphics and not gameplay.
Steam (Score:2, Interesting)
If he's serious then he should add something to Steam to support this process. I'm assuming that Steam has enough checks when signing up as a developer that people wouldn't be able to use this as an easy tool to con people, and it's possible that existing developers and publishers might even use this for some of their more unusual ideas.
I predict accounting arguements... (Score:3, Interesting)
I would be very wary of making such an investment, certainly for as much or more than I would expect to pay for a game once complete (and it is rare that I pay full-price-as-at-release-date for a game), because the cynic in me would expect something akin to Hollywood Accounting to be used to make sure that I didn't get the cut at the end.
Though if the level of investment required is less than what I'd expect to pay for the game once complete, the risk of getting nothing back (no game, no cut of profits) might be small enough considering the investment amount for me to be willing to take a punt on an idea I like the sound of.
Re:I predict accounting arguements... (Score:3, Interesting)
Agreed that a payment investment which is reduced from the price of a full game would limit the potential losses to any one consumer, and is a good idea.
If 10,000 people like your idea and the assets you've come up with so far well enough to give, say, $20 each, that's $200,000 to play with, which isn't too bad a budget for an indie game. I think that's a very achievable goal - the idea would have to be innovative and enticing, the development process would have to be open enough that people see their money is being put to good use (I'm not saying to give the consumers any real power over the game, but a blog with semi-regular screenshot posts would keep people assured that it's not abandonware), and you'd have to pump a little bit of your own money into it at the start to get those initial assets looking good... if you can do that then I would imagine that the community support would come through for you.
I'd see the "payback" on your investment being a copy of the game at the end, as well as beta access etc if applicable. If all goes to plan you'd be getting a good deal as one of those 10,000 investors; you'd have paid $20 for a $40 game, perhaps.
This probably only works for really good games. (Score:3, Interesting)
I'm doing this right now, at a nice profit (Score:4, Interesting)
(Pardon the AC, it's been years since I posted on slashdot)
I'm working on a game called Minecraft, which uses pretty much this model. It's been in development for a bit over two months, and pre-orders have been online since June 13. I've sold over 1000 copies since then, which more than pays for the remaining development time, and the curve on sales is still pointing upwards.
I know Mount & Blade used a similar system, and so does Dwarf Fortress. If small indie games can do this, why can't valve?
Motivate the programmers.. (Score:2, Interesting)
1. Generate interest
2. Collect investment
3. Profit
4. Interest wanes, Investments slow
5. Developer thinks of new idea
6. Goto 1
With this business model we'll never see any completed games.
What you need to do is set up a third party finance company who sign people up for a subscription. Subscribers then get access to all the games currently in development and then each month the subscriptions are divvied up between the various projects in a fair and quantifiable manner (i.e. number of players/hours played/etc). This way the investment is incremental so encouraging longer term development rather than letting developers grab a quick cash injection before moving onto the next project.
Re:Then open it up (Score:4, Interesting)
The only downside to your idea is that it's been tried (by Stephen King, no less) and found to be lacking.
King did it backwards, he asked people to pay after they already have the product in hand. Only the most generous of suckers is going to do that. Word was the story kinda sucked too.
The key is in holding the next episode/book/song/installment ransom. Sure plenty of people still won't pay, but when you've got a billion people on the net worldwide, you only need a miniscule fraction in order to be profitable.
It would also help to arrange the financing creatively, one way being a subscription. Sign up for the subscription and the money is auto-billed each month, works the same as music clubs, gyms, etc, and to a lesser extent cable tv does. You can also sell physical items like memorabilia that include a dedicated mark-up just for creative production costs, kind of the way PBS and NPR went to donation levels with guaranteed "gifts" in return - that move increased their revenues a couple of hundred percent. People like getting "stuff" for their money even if it is just incidental.
Re:Requirements? (Score:3, Interesting)
"A camel is a horse designed by comittee"
A simple but powerful quote.
I am fond of:
"Too many cooks in the kitchen spoils the soup."
Investors are not always partners, that's why investors have a board of directors to advocate for them.
Re:Then open it up (Score:4, Interesting)
The big problem I see with Valve's idea is you would need a community that actually trusts you to deliver on your promise. Pre-Left 4 Dead 2 announcement Valve probably had that kind of community. They don't any more and apparently haven't begun to realize it yet. Valve had a great community that would plunk down money for a promise. Why will that community keep plunking down money when Valve has shown that they'll walk away from their end whenever they think it serves them better?
Besides this idea isn't that far off from what is already happening in the game market. Heck, how many games come out now that aren't really any where close to being a finished product with the idea that if they are successful enough the company might (or might not) bother to fix them? All he's really proposing is that instead of paying to beta test the games like we do way to often now, we start paying at the barely an idea phase. How many times will the community invest in game ideas that go no where before they stop throwing good money after bad?
Another thing, what would stop Valve (or anyone who tried this approach) from taking the money, creating some barely working mishmash of ideas that show some promise, release a barely working version as the "finished product', and then promptly turning around and releasing the a more polished, "completely different", even though it's almost exactly the same game, as a separate property?
The answer? Not a damn thing.
I'm not saying this idea wouldn't work. But it would depend a large part on the level of trust your audience had that you would actually deliver a final product.
Stardock is already doing this (Score:3, Interesting)
Stardock has already been doing something similar to this for some time now. Those who pre-ordered Sins of a Solar Empire, Gal Civ 2, or any of either game's numerous expansions got access to closed betas very early on in the games' developments. The payoff, for those who invested in the games early on, is the ear of the developer and a chance to have a much larger say in how the game turns out than is usual.
Re:Then open it up (Score:3, Interesting)
"Once finished they collect their payment out of escrow"
I thought Newell's idea was that it would ease development costs. With this solution who pays the employees to make the game over say, a 4 year period?