Do you have a link for that? I have heard about his opinions from third parties but I don’t think I have read anything that specific. Cheers!
I think the article is wrong. I think Jeff Vogel is plain wrong (although I very much respect him). The PC market continues to grow and counts like “look more games are on Steam so lets divide revenue by games and ta da! There is less money to go around! See? Doomed!” is an overly simplistic take imho.
But the doom and gloom indiepocacylpse predictions and my “the future is so bright I gotta wear shades” attitude are irrelevant. So far nobody has successfully predicted the market.
What does amaze me is how little attention is spent on the year over year decline of users for the top mobile games. Mobile publishers for now can afford to ignore this uncomfortable truth of declining users because revenues are going up. But that doesnt hold for long, go ask social games.
Suppose you are a super low-budget micro-developer like me. It’s not super-hard to survive, because I can get enough sales to get by with a little cheap marketing and word of mouth advertising. I’ll be all right.
Suppose, alternately, you are a huge AAA developer with massive budgets. You can afford the massive marketing necessary to generate the big sales you need to pay for your expensive games. You’ll be all right, until you’re not.
But suppose you’re a mid-tier (sometimes called AAA Indie) developer, with $500K-$2 million budgets. You have a problem. You need advertising to get sales, as word-of-mouth won’t cover it. But you can’t afford a big campaign. The only way you will turn a profit is if you get huge free marketing from Steam/iTunes placement and press articles. (Which is why going to big trade shows and cozying up to the press is so important.)
But when there are so many games competing for free marketing, you have a serious problem. According to their site, the Indie Megabooth at the last PAX had 104 games. 104! At one PAX! Just indies! The games industry doesn’t need that many games this year, period. #mildexaggeration
Quoting from the first, 2014, article.
Could you ellaborate or link to someone arguing over these points being “wrong”? I am not challenging you, just asking for dissenting opinions. To be honest, my twitter and rss - inside and ouside of Steam - feeds come every day with at least one person imploring to wishlist their stuff. So that AAA-Indie studio isn’t a white unicorn, imo.
Also, where do those figures on market growth come from? Indeed, if the X on Vogel’s Equations is increasing faster than the Y, the inferences in his article are unfounded.
Well Steam definitely grew , with last year it growing yoy ~$0.7 to 1B last year it hit around $4.3 billion. This year it is (as far as we can tell) headed for its biggest year again.
Those are estimates from scraping sources, mine from friends put it a little higher but either way, strong growth.
But that is not counting the growth of PC games outside of Steam with Fornite bringing in an extra billion or so this year and Bliizzard activision continue to grow.
The PC markets growth is so strong we have had large players enter with new store fronts (Epic, Amazon, Discord) there is no sign that trend will slow, I think we all expect a Take Two direct service before the next GTA for example and there is every reason to expect the Microsoft Store to enjoy its biggest pc gaming revenue year with Forza.
As for the numbers of developers entering, well really, who cares? If the players and revenues are growing then thats growth. You dont divide the pie by the number of workers in an industry. I have never seen a business sector analysed that way, I mean, its a meaningless methodology imho. If you are looking at a market you figure out how you can grow it or compete effectively in a subset of it. Economics is not a zero sum game. More competitors can mean bigger market growth. All boats rise as new competitors bring in new customers. Its when you start to clone a product and decide to compete solely on price that you see declines, but again, nothing new. Gaining market share by price can work but its risky, particularly in entertainment.
I do think indie developers are probably facing an uphill battle if they are making a genre game right now, but thats not new and has little to do with the numbers of indie developers, much more to do with the amount of money AAA developers can throw at genre games.
lol I didnt really answer your question directly so let me do so now.
The number of products released in a sector has no bearing on that sectors growth not is a predictor for a given products success. Because it doesn’t take into account the quality or scale of the products.
For example if I release 4 half baked shooters next month I have cost Battlefield zero dollars. I do not impact them at all. If Activision released 4 AAA shooters next month then it could have an impact on Battlefield.
Likewise if my daughter and a few thousand girls like her run a lemonade stand this month she will have zero impact on the softdrink market that Pepsi is competing in.
So quality and scale matters. That is far more important than the notion of “more developers = less money to go around”. In my opinion of course, but so far the numbers and the growth are on my optimistic side.
Bloody hell thats a wall of text. But yeah good question. I could be wrong :)
From an outsider’s perspective, I used to (e.g. 10 years ago) play a lot of AAA games and some indie games, whereas now that’s flipped on its head. And I think that’s because AAA games are too costly to produce.
I think AAA game studios have backed themselves into a corner in terms of entertaining games. AAA games simply must have mocap, full and famous voice acting, a script, the fanciest tech, entirely scored, the biggest maps etc etc. And all this comes at a cost that then means you also need a massive marketing campaign. But in order to reach the number of people required just to break even, you have to make the game playable and interesting to the lowest common denominator. And I’m not really interested in playing such games anymore.
I don’t see how the AAA model is sustainable in the long run. The games get more expensive, more movie-like, and ultimately more dull with each passing year. Are we sure it’s the indie bubble that will pop first?
So even if there are a billion indie games coming out each year, at least I’ll be spending my bucks in that segment and not on the AAA segment!
Something like The Flame in the Flood? (Though with a raft instead of a wagon.)
Edit: I think The Long Journey Home might be of interest, too, but with a spaceship instead of a wagon:
I mostly agree with you. If you are clever with your financing and targets, there’s a lot of space for profitability on the Steam market still. And porting to consoles is dirt cheap now, which can multiply your market by 4 (depending on genre and target audience, but still).
I think there are two issues distorting the “indiapocalypse” perception.
First: profitability does not equal finantial success beyond belief. Profitability means you recoup investement, make a light profit and can reinvest in the next, hopefully bigger thing. The problem is that people “plan” for the later, with budgets of indie games in the millions sometimes, and that’s setting you up for a hard hit if your expectations are just slightly mismatched. An indie game that sells 10k units in each of the 4 core game platforms can be profitable (we are talking income of 100-300k if they have a publisher, more if they don’t, but look below). Size your project for realistic sale targets. If you are expecting to sell 100k copies per platform, you are going to need a hit, not merely a successful game.
Second: visibility is becoming an issue (has been for a while, really). In the article, Jordi de Paco is complaining about the onslaught of games on Steam, but they are published by freaking Devolver Digital. Their latest game, a low-fi graphic adventure, has sold about 75k (according to Steamspy). That’s not good, that’s amazing. Yes, the publisher took a share of the profits, but (good) publishers are becoming pretty crucial for indies to attain the needed visibility. Doing marketing by yourself, unless the team has a marketing genious and a hefty marketing budget, just increases the risks. Not all indies will be able to get a publisher, of course, but it hould be the first priority for most teams, and many times it’s just an afterthought.
Well, holy crap, I never thought George Drouillard would feature in a video game.
It’s one of the signs. It really is the indiepocalypse!
I implore you guys not to play this one. It’s needlessly frustrating to play.
When defining success, I think too many devs are looking for the “one hit”, or the lottery win with the title they are making. It really depends on your outlook. Do you have an idea (for one game) or a plan (to build a stable)? The lottery does happen (like RimWorld for example) but is super rare and gets increasingly so as the market continues to crowd. The plan is difficult and long term (study @cliffski2 's Positech) but more under your control and if you have the drive you are less dependent on luck.
You really need the money in the bank for the runway at least for 2-3 games without income to remain stable. Even if you can pump a decent game out every 4-6 months making one game that’s well profitable doesn’t mean your next game will be, and without the runway to absorb failures you are staking your whole business on that one next game.
Either that or you are assured what you have thus far is making enough regular revenue to keep you going, and budget/schedule accordingly. I forget how many games Cliff put out before he quit his “day job”, but it was definitely more than two I believe and I believe his revenue ~100K/yr though I may be mistaken about that. Maybe @cliffski2 will comment. Budget/Time to market is definitely key, and a huge consideration of your development should be schedule and budget. Too many people look for the big hit, and they want to do that instantly because they saw someone else do it.
I disagree, but there’s a learning curve for sure.
More like a wall. The lander bits suck all the fun out of the game.
… in your opinion, of course. ;-)
Of course. ;)
Minor Key, the studio that made Eldritch, is a good example of this. Eldritch was a significant success, but their releases since then (Neon Struct, Slayer Shock) have sold maybe 10% of what Eldritch sold. IIRC, the only reason they still exist is extremely low overhead.
I so agree with this. One of the things that saddens me is how friends who go indie quite often spend almost nothing on marketing and doom themselves. Sometimes even AAA devs somehow manage to overlook this.
Let me toss in another one , I also think colleagues sometimes put far too much weight on “names” to magically bring in customers instead of doing the hard work of actually marketing something. Very few people can name any game developer, let alone one who is making an indie game so that wont help. Celebrity endorsements (actors, musicians etc) are next to useless for PC games ,although they can work on mobile its still rare.
Good thread!