Economics Of Game Publishing Analyzed

Thanks to 1UP for its feature discussing the precise financial details of videogame publishing, described by Mastiff Games publisher Bill Swartz at GDC in San Jose last week. Swartz "put together various slides showing where the money goes for a hypothetical game", revealing that "a publisher can clear seven dollars on a game [after all costs are taken into account]." However, it appears that "only one of every five games will sell enough copies to make money, since publishers have to consider things like taking back inventory that doesn't sell through to customers", and elsewhere in the article, photos of the GDC slides show "a breakdown of how much publishers, wholesalers, and retailers can make, as well as what risks they face."

Comments

Is Valve attempting to cutout the middle man?

[Lucius Septimius Sev]

Valve's software Steam look likes it will be the first real attempt by publishers to sell their products themselfs. I wonder how other publishers will react to this? Will they get on board with Steam if they can get it to work correctly? If so they can really take a bite out of the Wal-Marts of the world.

They still will have to sell their games in stores and it might get tricky with the large chains they might even refuse to give publishers access to their shelfs.

http://www.steampowered.com