Every year the Entertainment Software Association of Canada (ESAC) releases a neat document with the essential facts about Canada’s video game industry. This year’s is similar to previous years in that breaks down the player demographics and provides some serious numbers on how well the games industry in Canada is doing.
“Canada’s video game industry plays a positive and vital role in our economy,” said Jayson Hilchie, President and CEO of the Entertainment Software Association of Canada (ESAC). “It’s a highly skilled, highly paid industry that employs young creative people; it’s demonstrating how Canada can create jobs and prosperity, export its creativity around the world and ultimately lead in the new economy of the future,” he added.
The growth experienced in 2014 is partially owed to innovation in the video game industry, including the introduction of a new generation of consoles into the market, but also other factors like huge Canadian blockbusters hitting the market, a continued explosion in popularity of mobile games (which accounted for 65% of all completed projects in 2014) and because of a positive business climate for video game developers in a majority of Canadian provinces.
Companies’ outlook for the future continues to be positive, with several companies expecting the growth rate to continue over the next two years. In fact, it’s estimated that 1377 jobs will need to be filled in technical and creative roles in the next 12-24 months.
Every indie game studio has the same problem: how to make enough money to make the next game.
It seems every month there’s a new post somewhere about how indie game studios are doomed. This is – and isn’t – one of those posts. Sure, it’s hard to make a profitable gaming company in the indie space today, but it was hard in the past too. It can be done! Many people have found ways to make money and games at the same time.
Making money isn’t easy
Making a profitable game depends on a lot of variables and in the indie space small decisions can add up to big costs.
“At the moment, our expectation is about 1/3 the return of the original Spider for 5 times the man-hours.” – Tiger Style’s David Kalina
Recently, Tiger Style released a sequel to their successful game Spider. Pocket Gamer interviewed Tiger Style and they looked into the disappointing sales trend that the studio is seeing. It used to be that if you got onto a platform you were guaranteed some returns, now that doesn’t seem to be the case.
“[I knew] the biggest companies would come along and colonize the market, establishing the rules about how games make money and locking the rest of us out of the majority of the revenue.”] He refers to the major onset of free-to-play as “the tipping point” for the App Store’s push towards big money, a weighted market in which companies like Tiger Style have no hope of competing.
With the premium approach on mobile stores no longer a solid option what can be done? Of course one game does not signify the approach is broken, but it can make people think twice about the strategy.
People are still making it in the indie world despite the obvious challenges of making a game. The strategies have evolved over time and here are some options each served with some scepticism on my part.
Make a good game
If you think that you can make a good game and just sit back and collect then you are sorely mistaken. Indeed, just a couple weeks ago Total Biscuit tackled this very concept in a video. It’s worth listening to at the very least.
At this point, I think it’s fair to say that we can eliminate bad marketing as the main cause of the game’s failure. Press were given ample opportunity to write about the game, and for the most part, thanks to the great work done by the PR company, they were made aware that it existed. Indeed, we actually heard back from many large press outlets saying they would not review or cover the game’s launch. As mentioned before, it wasn’t exactly a busy period so I think it would be incorrect to chalk it all up to bad timing.
If your games are really niche or really artsy then maybe the commercial metric doesn’t work for you.
Try cultural funding
This summer the innovative indie studio Tale of Tales shut down because they decided to pursue their individual art and because their most recent game, Sunset, was a commercial flop. They wrote a nice post and the sun sets…
In its 12 year existence Tale of Tales has always teetered on the edge of sustainability, combining art grants and commercial revenue to fund our exploration of video games as an expressive medium. We considered it spreading our dependencies. And that was fine, because we assumed this situation to be stable. All we really wanted was the opportunity to create.
They have been fortunate enough to be able to make their games with the support of arts funding. This is not practical for many studios and can be nearly impossible. I know that in Canada you can leverage some arts funding and it’s usually focused on helping individuals – not studios.
Last month Tales released their numbers and a bit of introspection on the whole experience since their announcement. They were able to breakeven on the game and are now trying out Patreon to fund their efforts.
In 3 months, 17,000 copies of Sunset have changed hands. This includes copies in a Humble bundle and those for the Kickstarter backers. This has allowed us to pay our debts and save our company. Tale of Tales is safe now but we haven’t changed our mind about moving away from commerce.
Notice that they reference bundles as something that let them save their company.
Bundles of money?
Grouping indie games into bundles to sell them at a discount all started with the success of the Humble Bundle back in 2010. Now there are so many game bundle sites that I won’t list them all, thankfully.
Are bundles worth it? Absolutely. Are they the solution to all your money woes? No.
If you look at the decision to distribute your game through a bundle as an isolated event purely analyzed by direct earning potential, you’re going to be scared away. When you understand the “marketing mix” this decision creates and supplements, you likely can’t find a better way to gain attention for your game. Too many people write on the theoretically of important topics, and I refuse to conform – so here’s some practical market data.
Target a specific niche
Maybe you are going to make a game that appeals to a very specific market (like the platform game in the Total Biscuit video). There are problems here too.
The term “female gamers” includes both a woman in her fifties playing Candy Crush Saga on her phone and a college girl enjoying Call of Duty on her Xbox. They’re so far apart from each other, that it makes no sense to try and fit them into the same vaguely defined category. There are many female gamers, they’re different and there are probably dozens of categories you could divide them in.
Ambitions will grow more modest. Budgets will be cut.
“PR better” will stop being the answer to everything
Indie gaming will survive
I’m confident that indie gaming will go on since what’s happening to the games industry has happened to pretty much every field of entertainment. Remember how Napster and GarageBand ruined the music industry and now there is no more music and nobody making money from it? Exactly.
Still, if you no longer want to make games you can always try to get paid by playing games. It sounds like you have to find a niche there and rely on direct contributions from viewers.
Where is all the money you’re making on Twitch coming from?
Fifty to 60 percent of my income comes from donations from people who like to watch me play. Combined with paid [voluntary] subscriptions to my channel, that makes up about 75 percent of my income. I’m finally at a point where ad revenue’s actually picking up. In fact, now I could probably live off ads alone.
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