Because that’s the most profitable way to invest money in media products:
Take Sins of a Solar Empire like I mentioned earlier. The game’s budget was around $1 million, yet last I heard (and this was quite some time ago) it sold upwards of 800,000 copies.
That’s because they happened upon a publisher (Stardock) who had just about that much money, and a fancy to publish games. If Stardock had much more money they’d only finance blockbusters like everyone else. And if Stardock wasn’t a private company run by Brad Wardell they wouldn’t bother financing games at all.
that is an incredible profit margin simply because the budget was also nowhere near MW2
That doesn’t necessarily follow. I don’t have the specifics on these two games, but on average blockbusters have a higher returns on investment. Which is why anyone who has the money to fund games like MW2 does just that.
The movie industry does not expect every single movie to be a blockbuster success.
Any film studio that can afford the expenses tries to get as many blockbusters as possible because those are the most profitable investments. The rest is just filler.
The RTS genre can be alive and well, even if it’s not shipping 8 million units per title.
No it can’t, not for long. That’s exactly what they said about wargames and flight sims, and look what happened. Anything that’s not at the top inevitably shrinks until it becomes a mini-budget niche market. The medium budget section is unprofitable and unstable in the long run. Those games are too expensive for self-financing and not profitable enough for external investment, hence the spiral of doom.
I’m not going to argue about this, by the way. Just read the article.
edit: Okay, one point where games differ from other media – you have different platforms, and each platform sets its own expectations that may allow for relatively lower budgets. Also, an exclusive platform owner may finance less profitable games simply to offer a broader selection to buyers. Migrating to cheaper platforms (portables, downloadables) has recently been a popular way to counter exploding budgets. But that only works until the budgets on those platforms explode, too…