Can Independent Game Developers Survive?

Thanks to Gamesindustry.biz for their editorial asking whether independent videogame developers can make it in the increasingly cut-throat games business. The article comes after the recent closure of respected UK developers Mucky Foot ('Startopia'), the latest in a long line of recent developer failures, and the author asks: "What's going wrong? Some of these casualties have been victims of mismanagement or poor quality control, but many were properly managed, fiscally sensible and extremely talented companies." The editorial continues: "Companies like EA, Microsoft and Sony don't really need [smaller developers] any more, as large publishers increasingly focus on internal development and suck much of the best talent into themselves. Smaller publishers aren't in a position to take risks on the kind of innovative games that small developers do best." Is the situation really as bleak as this implies?

Comments

Nothing new here...

[Doctor Cat]

The "independent developer" niche has always been crammed full of companies with short half-lives. If you want to "play the game" of trying to make A titles, or even B titles, with publisher funding, publisher distribution and marketing, and basically dancing like a puppet on the end of the publisher's strings, it's HARD to keep the cash flow to stay alive year in and year out, and very few developers build up the kind of warchest or royalty stream that will let them weather a project cancellation, abysmal sales of a title, or a six month drought between finishing one project and finally getting a contract to do the next game. So you see little companies come and go in the 3rd party development scene all the time.

That said, there are a few well managed ones and/or developers with big enough hits that they can stay around a long time - Stormfront Studios is still in business I believe, and id Software isn't going anywhere any time soon. Some of the more successful developers deliberately decide to be absorbed into a big company, too, like Blizzard or Westwood - and didn't Valve do that also?

The other route is to keep expenses tiny, always, and just keep making games until they pry the keyboard and mouse out of your cold, dead, fingers. The fellow that did the Dink Smallwood games is still at it, at the Independent Games Festival I saw his teenage lawnmower game. I've been running my own Dragon's Eye Productions for over 10 years now, and doing better than ever. PopCap Games is doing really great (and their games are tons of fun, so they deserve it), and there's too many shareware, freeware, flash and java games and game sites to even mention. Yes, a lot of them suck, but there's some good ones too. There's a lot of interesting looking games at dexterity.com for one. I still hope that Garage Games will thrive, too - they're doing original game development using the Tribes 2 3D engine (which they made, at their last company). I don't think the development houses are dying any time soon - just some specific individual ones, which has happened pretty much every year, often with little fanfare.

Re:Complexity

[idries]

Well, I am a game developer, and I have to say that I disagree entirely.

The dramatic rise in the number of small studios going bust (mostly in the UK AFAIK) is nothing todo with technology or QA or Art or any other kind of production problem. Remember that the whole development cycle is a drop in the ocean in terms of total development costs. Most of the cash goes on marketing and manufactuing. The root of the matter is the failing relationship between small studios and their publishers.

There are really 2 reasons for this kind of failure.

1. The first is having a publisher that's just trying to get something for nothing (or as close to it as possible). Generally, these publishers are in fanancial hot water themselves, and would rather not pay for milestones and shipped products if they can avoid it. Small studios normally can't sue publishers when this happens, so they fold instead. Publishers as dishonest as Bam!, for example, probably account for a fair number of bust studios in the UK.
   
2. The second is having a project that's too clogged up by the details of the publisher/studio business relationship to allow development to continue in a cost-effective manner. I have read in several places that the average time taken to sign a game in the UK is now 7 months. Small studios don't have the resources for this kind of wait, and generally don't have the manpower to perform all of the contract negotiation etc. that you have to do before anyone even writes any code. Even the most "honest" publishers are now very distrustful of studios because there are so many ways that a studio can screw up a project and cost the publisher lots of money (normally much more than the studio would ever see even if the project was totally sucessful). Many studios have stung publishers for loads of money, whether through incompetance, deception (stealing resources from one OK project to help out a another failing one), or just by putting all of the publishers cash up their noses and then turning out a crap game (i.e. Dikatana).
   
   The real problem here is that publishers are trying to protect themselves with standard business approaches (mainly lawyers and accountants). This is only partly effective as it only really gives the publishers more control of the situation, but normally leaves the studio unable to actually ship a game, or forces them to ship a crap game. This is of course bad for the publishers in the long run. What these publishers tend to fail todo is protect themselves by monitoring how studios actually produce games. The studios that are still around are around because the people that deal with their publishers are good at their jobs, not because those studios make better or worse games than the other studios that have gone bust. IMHO publishers should stop putting studios through the mill with royalty and IP negotiation, and start inspecting their internal processes. I've only ever encountered 1 publisher that sent a programmer along with their producer to evaluate the studios' technical expertise, and that was Micro$oft. They also sent an artists to evaluate our art team, and a designer to evaluate our design team. Well done Micro$oft!
   

Anyway, that's my 2p.

Re:The two things that small developers lack...

[GrumpyDog]

>>Can a mod community make a mod better (or more unique) than the game they're modding? Can they put together an actual _game_?

Desert Combat and EOD vs BF1942.

Zy-El mod vs. Diablo 2

A lot of NWN Persistant world servers vs. NWN

CS, DOD, FA vs HL

A bunch of good UT2003 mods vs UT2003

Action Quake2 vs Quake 2

Tac Ops, Strike Force vs. UT

And a whole lot of others......