Indie devs in the US especially tend to live in a bubble where they think a handful of tweets by controversial twitter activist personalities will automatically translate into huge sales, income and sustainable success. The reality is far messier, involving a lot of shows, social media, paid advertising, hustling with youtubers and streamers, and of course working like crazy to make a great game on time and on budget in an underserved genre.
There is also a myth that you can make money, or even not lose too much money with your first indie game. Its crazy competitive, and seriously hard. I always remind people ive had an indie studio for 20 years and been coding for 37 years, and i’m still in the biz, so someone on their first game with < 2 years coding experience is seriously outgunned.
I remember looking at those before, the style of one doesn’t appeal to me, maybe a little too much action there, and the other, maybe one day. I appreciate that pitch. I wouldn’t mind an Oregon Trail a lot like the original one actually, but… I’m not sure that kind of game can do well today.
I appreciate the suggestions though. I did look at both of them when they released their trails/came out.
There were some really harsh comments on that YCombinator thread. But thanks for sharing the link @clay - I must say I found more insightful the linked post to @cliffski2’s blog. You got a new follower on your feeds @cliffski2.
Since Valve is not a public company all I can find on the Internet are “guesstimates” on the actual revenue brought in by Valve Store sales. In any case, I will assume that the figure your mates have come up with a figure in the right order of magnitude, so that fixes X.
We could aggregate the money flowing into the overall PC market but I think then we can kiss goodbye to any analysis. Steam, Blizzard, EA Origin, GOG, the UbiHub or whatever is its name are each pretty much siloed as they each have very different rules and mechanisms to set prices, determine visibility or decide what comes into the store front.
That is an interesting trend - obviously big players want to minimize the “loss” of revenue due to middle men (like Steam). A similar thing has been happening for some time in the audiovisual market (Netflix vs HBO vs Disney vs etc.). Still, I don’t think those storefronts are of direct relevance to this discussion re: indie games chances of success, unless they start carrying indie games as well.
So we have 4.3 billion in. But that really doesn’t tells us anything about is it distributed between the objects in the set Y? Over the weekend I blew the dust over my half forgotten elective college course on macroeconomics and reviewed a bit the notion of “perfect competition” and “perfect markets”
my understanding is that, as a model, it is useful enough sometimes so as to investment and private banks use it as part of their decision making process when it comes to provide loans or funding.
I think we need to tell apart what is within the realm of the possible from what actually happens in most markets which aren’t chained to “real world friction” (cryptocurrency comes to mind). It doesn’t need to be a zero sum game, but it is clear even from your exposition, that it is pretty much a “winner takes it all” (or almost all) market.
So it may not be that the payoffs in the “game” are binary, but if instead of 0 and 1, you have 1e-7 and 0.999999, the difference lies in how big is the money flow into the broad category your product best fits. If you are doing Battle Royale games because it is the flavour of the month, you can make a tidy sum. If you are doing a party-based, RTwP RPG (or worse, a turn-based one) you’ll probably end up suffering.
One really weird thing about Steam is that price and marginal cost are entirely disconnected. Under the light of the perfect market theory, it is as imperfect as the real estate market is. Deep game discounting have indeed increased “reach”. Lots of people have those games in their libraries. But it has done zero for engagement, which is having people actually playing the games. I think that there’s little point in reaching people if you don’t create a compulsion or a preference in them for your stuff. It also essentially disconnects or interferes in the relation between price, revenue and marginal cost.
One point where classical economics model fail is in that usually there’s an implicit assumption that the agents in the market are public or private companies, for which the ultimate reason to stay in business is that the average revenue per product is greater than the marginal cost (that is recouping the investment). In this market, we have two kinds or three of agents which Jeff Vogel’s clearly identifies:
The AAA players
The Indie-AAA players
I’d say that the classical model accounts well for the behaviour of the first type of agent. It certainly doesn’t apply so much for the third type (which is incredibly diverse), we have Jeff Vogel on one side to the platformer game guy linked by @clay. The reasons for this is that AC isn’t measured in “money”, but usually in “time” which are related, but not the same thing. Also, the rewards may not be entirely monetary, but include the “joy of crafting” things for the sake of it.
What about the middle set? I think they may occupy a murky middle ground.
Thinking about how is the “competition game” like, I muse with the following theory. In any given “genre” (and here we can be very broad or very narrow in scope defining them) it is generally true that:
If the first type is involved, the payoffs are zero sum (either you get it all or you get nothing) or become a lot like that over time.
If the second type is involved, payoffs are distributed in a more even manner, but there’s clear “winners” and “losers” (for instance, we can compare InXile, Obsidian and the Pathfinder on a given genre “party-based RPG with detailed tactical combat”), leaving space for the third kind (Jeff Vogel’s Avernum games)
If only the third type is involved, it is the Wild West, and the market is nearly “perfect” as in shares being very even (especially when there’s only one player in the competition game :-) ).
On the other hand, price reductions allow developers in heavily contested markets to reap some benefit, perhaps? As in people being more prone to spend five bucks in a game which is like PUBG but with a twist? Is a reasonable strategy to try to be a “bottom feeder”? Does it make sense to make games which aren’t going to be played but are basically bait for lazy dollars?
Would this be a useful way to look at how the market hosted by Steam operates? Are there alternative models to look into?
This article makes me feel like this person is shaking their fist at the moon and blaming it for the zero sales - there seems to be no understanding of the disconnect between the production of the game program and the interest of people to buy it - and even after it is obvious that no one either knows about the game or cares to play it, the result is to curse the cruel world of an over saturated market, not the fact that they started and finished in last place in their genre from a profitability perspective.
An exercise in observing more of this is to occasionally read the latest devblogs on itch.io.
You look for the ones that say they just started their Kickstarter - and those KS pages have an unrealistic goal set (think 5-6 figures) and after three days 1-5 people for a total of sub-$50. The updates never come and the projects quickly wither - but they are not canceled, they just close out with no updates and 50 bucks.
Somewhere there was never a valuation process before the investment of time/resources, there was only the assumption of getting rich without a plan.
There’s a thing going on here, where people don’t understand that art isn’t really supposed to make money. Most people who take painting classes at the local Community College don’t expect to be able to sell their art, or at least, not any more than at a local crafts fair. They do it because they like painting, and want to improve themselves. Sure, there are professional painters, but most people who paint aren’t. It’s best to think of indie game development like building a china cabinet in your garage. It can take a lot of skill and hard work, but objectively, nobody cares except for you and maybe your friends.
Partially this is a casualty of the “follow your bliss” line of thought that people (especially in the US, but not exclusively) have been fed for a long time. This isn’t intended as millenials-bashing (as fun as that can be) per se, as it has a longer history than just today’s kids, although the side-hustle-economy and general economic insecurity likely makes such issues more visible.
At the end of the day, as criticisms of Marxism are fond of reminding us, effort != value. Just because something is hard, doesn’t mean its valuable. Just because you spend a lot of time making something doesn’t mean that anybody else is going to see any value in it.
This isn’t just a games or art thing. The very good Farm to Taber podcast talks about how many American farmers view farming as a lifestyle first, and a business second. People think “well, I’m (or want to be) a cattle rancher, so I’m going to grow cattle, and hope somebody buys it” rather than thinking “Well, I have this cattle farm. What does the market want, that I can produce using this land, and my skill set?” It’s a backwards way of approaching a market driven economy, but a common one. The fact that people see video games as an artistic, or at least art-adjacent discipline, means that this tendency is amplified. It becomes about broadcasting your personal expression to the world, rather than servicing a product into a market.
If you want to express yourself, don’t expect to make money. If you want to make money, you might not be able to express yourself. Some people get to do both, but you probably won’t, because most companies fail before their second game is released.
I think there’s a lot of truth to this comments from the Hacker News thread about the article:
You have to look at really successful indie games, such as Terraria, Factorio, Mini Metro, Stardew Valley, Darkest Dungeon, Papers Please… and there are many more. If you look at these games do you really think there is an alternative reality where they would not sell many copies? I don’t.
And if you have a good look at them you should realize that they all are extremely polished and coherent. None of them has realistic AAA graphics but they still look good. None of them is just a “copy” of an existing game. They either bring something totally new or bring something known but with a greater overall quality.
Then you have successful niche games such as Cogmind or the Zachtronics games. They still have the mentioned properties but also target only a subset of players where there are not many games. I think that makes them guaranteed sales.
Now what’s wrong with all the stories about failed games? They all are generic. They don’t offer something special. And this is what doesn’t work in a saturated games market. And I’m not saying the authors didn’t work enough. They just don’t see what’s wrong with their games and continue on their path to demise.
Now, on the other hand, there are plenty of games that are not generic that fail.
That argument (not your, I know, but the OP’s) is so naive that it barely deserves discussion. The other way of phrasing it is: “Do you believe that there are games that are just as ‘good’ as Mini Metro that did not succeed n the market?”
100% Yes. It’s like pure, uncut survivorship bias.
Take a look at the mobile games market (especially on Android, where the threshold to publish is non-existent). There are a ton of such crap on the market, clearly produced by professional “game development” companies. Clearly there is money to be made there if you can get the products past the gatekeepers.
IMHO certain projects are marketing directly for the impulsive Steam users as there do seem to be a great deal of these gamers. The entire effort is put into pitch, art and viral marketing with very little play. There are some ‘huge’ hits too where design of the game itself is quite poor and you still see people trying to validate their purchase as more than an impulse buy. But the game design is seriously flawed or play just does not exist. Others have it in their backlogs and will never play it but they were caught in the hype/sale/bundle.
Have to agree with Clay here - this line of argument is pure survivorship bias. There are lots and lots of realities where these games sink without making much of a mark. Polish and innovation all help increase a game’s chances for standing out, but it’s never enough. You also have to be at the right place at the right time.
I agree that it’s survivorship bias 100%, as described in the comment. However, at the same time, most games that don’t have some type of unique angle or that aren’t extremely polished won’t ever break through the membrane of success (which kind of sounds gross). So, while 95% of games that are unique might fail, the ones that make it tend to be unique and polished, not simple clones with nothing to offer. It’s not enough to make a metroidvania game or a roguelike. The author of the linked article seemed to think that it would be, at least for him.
FWIW, I think the person who made the comment likely realizes that it’s survivorship bias, which is why it’s engaged as a question. Anywho… that thread of comments provides lots of perspectives on the issue.
I don’t know about that. I think there are plenty of games that have very little “special” to offer, but which are still quite successful. I don’t want to name any PC games (because even an unremarkable game also has a ton of hard work behind it), but go on mobile and there are again a ton of examples of extremely average games that make loads of money (IMO, the mobile ecosystem sees every trend in the gaming market, and then dials it up to 11).
Wrt the original blog post of that thread, I’ve seen a lot of similar articles over the past few years of the same type - and the replies seem very similar (though very fun to see Walter Bright apparently commenting). Unfortunately lots of people with unrealistic expectations in indie game development. Seems like a classic case of “if I build a good game”, then … “profit”.