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No offense, publishers, but you can kind of be a pain to work with sometimes. So says Valve’s Gabe Newell, and we agree with him. Fortunately, good ol’ Gabe also has a solution to the developer-solution problem, and is very handsome.
“One of the areas that I am super interested in right now is how we can do financing from the community. So right now, what typically happens is you have this budget - it needs to be huge, it has to be $10m - $30m, and it has to be all available at the beginning of the project. There’s a huge amount of risk associated with those dollars and decisions have to be incredibly conservative,” he said.
“What I think would be much better would be if the community could finance the games. In other words, ‘Hey, I really like this idea you have. I’ll be an early investor in that and, as a result, at a later point I may make a return on that product, but I’ll also get a copy of that game.’”
Thus, he concluded, gamers would sacrifice their piggy banks only to game ideas they really like. Ideas lacking in the money magnetism department, then, would weed themselves out and never make it to market.
So, would you drop a few of your hard-earned dollars into an unproven concept? Honestly, we’re not sure how we feel about it. For instance, we doubt we’d have thrown cash at “A plumber who eats mushrooms, grows taller, and turns turtles into shoe-shaped putty,” and look how that turned out. With great power comes great responsibility, and we’re not sure if gamers are ready for that.
Comments are closed on this article
Slugbait
July 23, 2009 at 10:10pm
Let me give you an example: after v1.0, the MSN Messenger team never released betas. The reasoning was that this would give AOL and Yahoo clear insight into what they were doing, and allowed the competition plenty of time to develop feature parity...in other words, the competition keeps their customers from churning by offering the same or similar must-have new feature in the same product release time-cycle. You might recall that MSN Messenger was first to have a "The other person is typing" indicator during an IM session...this was enormously cool back then. MSN Messenger was also the first to personalize IM with display pics and background images...also later copied by nearly all other IM clients.
Once a customer has churned, there is less-than a 15% probability that they will ever churn back. You don't do feature parity to get people to churn to your product, because they won't...they already have that feature. You work new features that those people never knew they wanted in the first place, and you hit them square in the face with that new feature on RTW...that's what gets them to churn.
Then there was the Windows Live re-org, and suddenly the "new" Windows Live Messenger was releasing betas every other month. You can guess what happened next...
Which leads back to Gabe's idea. You announce a game, and you throw out specific information to get investors to finance your development. The competition sees this information, there is a brand new concept no other game has ever done, and they have an OMFG moment (previously known as the "Ah-ha! moment"). The competition is only a year or so into development, so they can take this revolutionary idea or twist to make their game even better, and release well before you do.
By the time the game you invested in is released, that one truly cool concept has already been done before.
Epic fail.
lien_meat
July 21, 2009 at 9:46pm
What happens when a game development company decides to take the dollars you invested in game X and utilize them to instead build a game engine that they "intend" to use for the game you invested in, but that goes vaporware, and you ACTUALLY just invested money in a game engine that nobody might even use. (read: duke nukem forever) Sometimes it's necessary in a company to use money intended for another purpose originally to drive another area of development to keep up stock prices. I smell a huge fail if this ever actually happens. Gamers are gonna be pissed when the money they put forward isn't apparently put to use on what they had in mind, or they don't think the quality of the game was deserving of their investment.
### I'm an idiot, and I approve this message ###
nekollx
July 22, 2009 at 9:34am
which is why i belive they should get cupons good for their investment good toward ANY game the company produces. IE i donat 5 bucks, i get a $5 Vaulve Cupon
------------------------------
Coming soon to Lulu.com --Tokusatsu Heroes--
Five teenagers, one alien ghost, a robot, and the fate of the world.
aviaggio
July 21, 2009 at 3:00pm
Gabe needs to go back to his crack dealer and demand a refund, cause he obviously got a bad batch of smack.
Is it just me or does the stuff coming out of this guy's mouth get more and more batshit crazy every year?
It's bad enough that we poor schlumps known as "consumers" are forced into buying games that suck without being able to return such turds. Now we're supposed to invest in them as well??
Exactly what am I going to get for my money? Will I have a say as to what features are included or removed in the final product? Do I get a cut of the profits? Will I be able to demand progress updates, review artwork, story lines, and preview demos, to see how my money is being put to use? Somehow I'm thinking not.
It sounds like good 'ole Gabe wants to give us a one-page features list with some pretty pictures to convince us to "invest" (read: pre-purchase) his new game, and then wait patiently until we get the final product 2-3 years later for "free" (which aint' free cause you already paid for it in advance). And what happens if the game is scrapped? Ooops, your money is lost, so sorry, no game for you. And what if the game sucks ass? Oh well, better luck next time.
Sorry Gabe, I prefer to withhold my funds until the game is completed, reviewed, and demoed before I shell out my hard-earned greenbacks.
r3dd4wg
July 21, 2009 at 11:08am
If the company can get a good bond rating or has a good bond rating, you might as well issue bonds for the financing.
zioburosky13
July 21, 2009 at 9:38am
It might be a good move to get rid those bad game idea. We keep seeing the same old 'yeah me too!' game titles this day because game publishers don't have the cojone to try out new game and honestly, most of today's game are being dumbed down for the console market in hope to regain their invested money in a safe way.
MeTo
July 21, 2009 at 9:22am
Fan's do finance game development when they buy a game. When you make a game sell it and don't put all the prophets in your pocket put some back in develoment! Thats the problem too many big guy's at the top take all the cash.
jnutley
July 21, 2009 at 7:00am
I'm supprized to see people still pitching or tacitly agreeing to the Neo_Con line where Investors (read Wall Street) have some magic knowledge that gives them insight to what will or will not sell. Take a good look at the current economic crisis, ask yourself if gamers as a group with specific knowledge of what they liked and didn't like could possible screw game development up more than the MBAs already have screwed the economy in general.
That said, I suspect this version of fund raising will have plenty of pitfalls of it's own. And the likelyhood of the developer going under or not getting enough money to keep going after already starting and taking a significant block of money from the community down with them is significant.
The way to sell it to fans however, rather than a two sentece text pitch as in the example is to pay a real artist to produce concept art. Pretty pictures will rule this version of fund raising.
Oedipus_Rex
July 21, 2009 at 6:58am
"So says Valve’s Gabe Newell, and we agree with him. Fortunately, good ol’ Gabe also has a solution to the developer-solution problem, and is very handsome."
I mean, you are in San Francisco. o_O
Vegan
July 21, 2009 at 6:16am
The amount that they'd want is probably more than what I pay for games, anyway. I always wait for epic $10 sales.
Gailim
July 21, 2009 at 6:00am
Mount and Blade released a demo while it was still in beta, and if users liked it they could buy the beta for a reduced price, the early beta's costed about half the final price and the price would go up with each succesive version. I personally bought it for $25 and the final price was $40. now, I wasn't an investor but before the studio (a small turkish dev run by spouses) found a publisher, that was how they funded the game
it worked out pretty well for them
Hoboparade
July 21, 2009 at 5:55am
This is why the Jesus (In cahoots with Adam Smith) invented capitalism. The good ideas/games (aka the ones that will turn a profit) receive financing and the rest simply won’t. If game developers have excellent ideas/products but lack the capital to develop; they should go public and have people invest in the company not in individual games/software.
nanook
July 21, 2009 at 5:10am
Offering investment to something that will become a source of income or return of investment is how both mediocre and big ideas are realized, isn't it? But unlike professional investors, gamers want something else than return of capital.
I am not an able investor. My funds are limited, and I must therefore limit my investment to something with a overwhelming probability of being fullfilled. If a game costs 50 USD, I would be willing to invest let's say 40 USD for something that is much of the same.The fact that I am willing to invest at all would also be a benefit for the company in that my and other enduser investments can be used as a measure of how likely the product is to make money in the future. It is the demand for return and projected sales that makes the game cost 50 USD over the counter, not the costs for development.
Now, if someone could make an unrealised idea that I have dreamt of all my life, I would gladly cough up 500 USD if I had trust in that company. I doubt if any small indie-company could offer me that level of trust.
And by the way, where IS that game that combines CIV, SIMS, EVE and Half-Life?
sk8nrck2
July 20, 2009 at 10:23pm
Personally, Im a little nervous about this. I think that it is a great idea in theory, but that
assumes that the game makers, A) give us an acurate discription of what there idea is and
B) the idea will stay the same throught the project.
How mad would you be if you gave money to a project and it was never completed,
or the company went belly-up in the middle of it.
bingojubes
July 20, 2009 at 9:48pm
he must have read info on the same group currently doing Interstellar Marines. right now, this indie group is doing this idea for their "community fans" that wish to partake (and donate funds) to be in partners in the development of the game. in this sense, Interstellar Marines will be a fan-game, because they put alot of input to the makers...and most importantly, they listened so far to their donators. Hopefully Interstellar Marines will be good, even if it looks a bit dated graphically.
More info for Interstellar Marines @ http://www.gamespot.com/xbox360/adventure/projectim/index.html?tag=result;title;0
ferds7
July 20, 2009 at 9:31pm
I think this idea could be great for the industry. Though I also think a lot of games need to cut down there budget probably. There are way to many games that I see that look like they focus to much on nice graphics and not enough on gameplay.
Did he mention what kind of information would be shared with would be investors?
I Jedi
July 20, 2009 at 9:40pm
I agree. A lot more money is well spent on making the game look beautiful, rather than developing a great story, or gameplay functionality. Personally, HL2, imo, has to be the perfect game. Offered a great story, great game functionality, and didn't push your hardware to the limits while retaining a beautiful enviroment.
Anyways, to the quote about rather or not gamers are ready to "handle" this or not. Well, I think they are. Gamers are what makes or breaks a game, gamers are where the feedback for games comes from, and gamers are what keeps the gaming world.. well.. spinning.
bingojubes
July 20, 2009 at 9:51pm
if donating to game development, i better get a free copy when they release it. Also, of course, they could then keep track of how many copies get released early to the donators of this feasible system.
I Jedi
July 20, 2009 at 10:40pm
I would agree with you, but to a point. People who donate money shouldn't get a "free" copy of a game automatically. Think about it. Let's say a developer starts the donation asking pot at a minimum of $5 dollars per person. I give that $5 dollars and a year later the game is released and I get it for free, just by donaitng that five? I do not see how a game studio would benifit much from this, as they would lose a $45 dollar profit if we assume the game is $50 total. Instead, I could see someone getting a coupon off for their donation. For example, donate $20 dollars and you only have to pay $30 more at game release. Donate $50 and get the game free if it releases. This is a better business practice to me at least. Maybe I'm just nuts, but I would think that this would make sure the developer made a profit and the consumer would only have to pay for what they didn't donate to the total cost per unit.
trident60
July 21, 2009 at 2:48pm
I understand that donating five dollars for a 50 dollar game and then wanting a free copy to be out of the question. But 50 dollars for a game ? First off, we all know these things are overpriced considerably, so I'm willing to wager if we paid half that they'd still make a profit. Secondly, if you go out on a limb, donate money for this project that you will never get back, you should get a nice kick back for doing it. I don't see why you should end up having to pay full price for the game when really you were one of the people that helped build it.
nekollx
July 21, 2009 at 9:17am
i could get behind this idea or eveil a 2 for one deal
Donate 10 get a $5 cupon
------------------------------
Coming soon to Lulu.com --Tokusatsu Heroes--
Five teenagers, one alien ghost, a robot, and the fate of the world.
DePat
July 21, 2009 at 8:50am
At the end of the day, the developper has to make money and giving coupons to cover the difference between the donation of the cost of the game if released is a great way to encourage donations. If they implement that, I probably will donate .
DePat
