Wednesday, March 18, 2009
Jeff Vogel Casts "Dispel Illusions" On Indie RPG Sales Numbers
I posted this earlier in the forums, but I figured I'd throw my commentary around. Spiderweb Software is perhaps the most well-known indie RPG developer out there, as Jeff Vogel has been at it since ... well, since people were still talking about Doom. That's a lot of experience, and a lot of market share. He's not the typical indie developer.
This week, he's gone out on a limb to post actual hard numbers about costs and sales for what he considers a pretty representative "average" game for his tiny company. He chose Geneforge 4, as it had numbers that were easily tracked, and represented a pretty average game for his company. Next week, he'll discuss it in more detail, but here's his report on the game:
"So Here's How Many Games I Sell" at The Bottom Feeder
I recommend reading it even if you have no intention of developing games. Unless you really, really don't want to peek inside the sausage factory for fear of losing your appetite.
I think if you have an image of indie game development as some kind of a miniature rock-star path - the equivalent of playing the club scene until you get "discovered" and start making millions - this might be a little damaging to your worldview.
The bottom line: The game cost $120,000 to make, including the cost of printing hint manuals, contractors for art, and a salary for three full-time employees (though not all three were working on this project specifically the whole time). That's pretty modest returns. Now, a year after the release of the PC port, the game has made about $117,000 back - including the sales of the hint book. So it's squeaking in at about $3000 short of breaking even.
It has sold less than 4,000 copies.
By comparison - a game selling less than 400,000 copies in the mainstream, triple-A game world is often considered a failure. But then, their budgets are often about 5x - 10x what Jeff has, and they probably make less profit per unit after considering the retailer's profit margin, the distribution costs, reproduction costs, etc.
Jeff notes that while he hasn't tracked piracy, he has plenty of anecdotal evidence that it is very high. Into the tens of thousands. Far more people play pirated versions of his games than pay for them. Which, unfortunately, seems to be pretty consistent across ALL games - indie or mainstream, DRMed or non-DRMed. Pirates are indiscriminate, and they outnumber honest people by a gigantic margin.
Dirtbags.
But in spite of all that - he's managed to make a sustainable business out of it. I'm sure he still makes a trickle of sales each month for the first three Avernum games. Building a sustainable business like this is a success all by itself.
And that's the really unsexy, non-rock-star thing about indie game development (well, mainstream development, too). It's a business. It's about building a business. It requires a lot of work and effort put into non-game-making stuff to make it a business. And oftentimes, it's a business that doesn't pay all that well.
I really appreciate Jeff's candor in presenting a solid data-point of reality to help people understand the industry and dispelling certain illusions. Here's hoping the indie RPG biz remains profitable enough that Jeff and the other folks at Spiderweb can keep making games for us to enjoy!
Labels: Biz, Indie Evangelism
- posted by The Rampant Coyote @ 6:52 AM (Permalink)
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the problem with his piracy number is he pulled it out of his.......
obviously it exists but conflating people who copied it would have bought it if they couldnt copy it is false.
4000 copies in a two year time period for a niche market.. 160odd copies a month..
I'm not sure our niche market has 'tens of thousands' of players to start with.
Interesting numbers none the less.
obviously it exists but conflating people who copied it would have bought it if they couldnt copy it is false.
4000 copies in a two year time period for a niche market.. 160odd copies a month..
I'm not sure our niche market has 'tens of thousands' of players to start with.
Interesting numbers none the less.
Stu - I think you are confusing him with somebody else. He doesn't even insinuate a 1:1 relationship between a pirated copy and a lost sale. All he is saying there is that there are a lot more people who played the game than bought the game.
He does imply that it's in the same boat as his extra-long demos as being a possible negative impact on sales. I think that's a pretty obvious conclusion - assuming NONE of the freeloaders would have become paying customers if piracy was not an option is even sillier than assuming a 1:1 conversion.
He does say that sales via portals and other distribution services were in the "jillions" for Geneforge 1, so that also implies that our niche market might have at least tens of thousands of players. Maybe. If they haven't all disappeared in the last decade. So there's probably a lot more folks that he's not reaching yet.
But yeah. Very interesting numbers. Certain to be debated, analyzed, projected, twisted, and quoted for months and years to come. :)
He does imply that it's in the same boat as his extra-long demos as being a possible negative impact on sales. I think that's a pretty obvious conclusion - assuming NONE of the freeloaders would have become paying customers if piracy was not an option is even sillier than assuming a 1:1 conversion.
He does say that sales via portals and other distribution services were in the "jillions" for Geneforge 1, so that also implies that our niche market might have at least tens of thousands of players. Maybe. If they haven't all disappeared in the last decade. So there's probably a lot more folks that he's not reaching yet.
But yeah. Very interesting numbers. Certain to be debated, analyzed, projected, twisted, and quoted for months and years to come. :)
I would like to hear more about long term sales. The benefit that indies have is that their games are on the market for a lot longer than mainstream and their few month shelf life. Or so I believe.
I wonder how much sales from older games help them out when developing newer games.
I wonder how much sales from older games help them out when developing newer games.
In THEORY, if his sales curves are anything like Reflexive's - one could adopt this article I wrote way back when:
http://www.rampantgames.com/blog/2007/03/trick-to-earning-99-times-more-selling.html
It wouldn't be out of the realm of possibility to imagine that the rest of his titles are earning anywhere from 1/3rd their first-year sales (for more recent titles) to 1/5th of those sales (or less). Note that these numbers were, technically, for 1.25 years' worth of sales (but the Windows port was closer to one year). I imagine part of that cumulative income goes to pay the other part of the salary of the other two full-time employees that are not in the game development budget.
And recall that this game was selected as a middle-of-the-road earner. That would mean that about half of his games just do not perform that well - in spite of having similar budgets. So the residual sales of older games probably help take up the slack for the titles that take a much longer time to break even.
This is a Very Good Thing because it means the company is unlikely to go under because of one stinker.
http://www.rampantgames.com/blog/2007/03/trick-to-earning-99-times-more-selling.html
It wouldn't be out of the realm of possibility to imagine that the rest of his titles are earning anywhere from 1/3rd their first-year sales (for more recent titles) to 1/5th of those sales (or less). Note that these numbers were, technically, for 1.25 years' worth of sales (but the Windows port was closer to one year). I imagine part of that cumulative income goes to pay the other part of the salary of the other two full-time employees that are not in the game development budget.
And recall that this game was selected as a middle-of-the-road earner. That would mean that about half of his games just do not perform that well - in spite of having similar budgets. So the residual sales of older games probably help take up the slack for the titles that take a much longer time to break even.
This is a Very Good Thing because it means the company is unlikely to go under because of one stinker.
Triple-A titles are usually even more expensive that the 5x - 10x indie budget that you are referring to.
It is not unusual to see 10 - 30 million dollars budgets. Supposedly GTA4 cost as much as $100M...
Multi-million units sales are often a must at that kind of expenses to be profitable products.
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It is not unusual to see 10 - 30 million dollars budgets. Supposedly GTA4 cost as much as $100M...
Multi-million units sales are often a must at that kind of expenses to be profitable products.
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