The Ties That Divide - Is Game Development A Cooperative Or Competitive Game?

by Matthew Kato on Sep 29, 2009 at 11:13 AM

“The worst part of this business is that publishers think developers are out to screw them and developers think publishers are out to screw them.” Paranoia. Power. Money. These are all common themes in game development. Unfortunately, they take away from everyone’s primary goal: making a good game. Game Informer talked to people on both sides of the equation?– some who could only do so anonymously?– to shed light on the behind-the-scenes battles that go on in game development between publishers and developers, and to discuss how this traditionally at-odds relationship can be fixed for the betterment of the games that we play.

On the face of it, the relationship between developers and publishers is simple: Publishers give developers an advance payment and the promise of back-end royalties to create a game, with payments doled out at agreed-upon milestones as the project progresses. These milestones, which vary in length, could involve anything from demonstrating how an in-game feature might work (even if it lacks any AI, art, etc.) to providing a playable preview build for a press demonstration.

In practice, while milestones are important in guiding development, mapping out years’ worth of work is a fool’s errand. “I’ve never worked on a project where from the beginning to the end, we knew what the product was we wanted, and at the end sat back and said, ‘That’s exactly the product we started to create,’” says producer on the publisher’s side Pete Wanat. Not only are features being added and dropped, but technology is changing and a host of problems can derail the project from day to day. Unfortunately, s--- happens?– and that’s also the moment it hits the fan, because if you don’t deliver on a milestone you don’t get paid.

Developers’ need for cash from publishers puts them in desperate situations. It can cause them to sell off the rights of the intellectual property they’ve created to the publisher, accept bad royalty rates, or be bought out by publishers (where autonomy is exchanged for survival). Often, financial demands create a situation ripe for bad choices. Multiple develop-ers told us that studios often take projects that they know they can’t finish simply to get money from a publisher. They gamble that the publisher will give them more time?– even if the publisher doesn’t like the game?– because of the money already invested. This only leads to bad games and mistrust.

Developers’ monetary demands also lead to bad competition between developers, since publishers often look for a studio to make a game that fills a certain need in the publishers’ portfolio. In this case, external developers might have to outbid each other for a project?– one which they might know they can’t fulfill to expectation?– and as the fee for work gets lower and lower, so does the promise of quality. One anonymous developer we talked to thinks that under certain circum-stances made-to-order titles are bad for the industry. “There is a little secret society in every publisher that says, ‘Here is a game we’re going to do. We’re trying to hit a marketing window, and we don’t care how bad it is. We’re just trying to sell to those people.’ I believe that these destroy our industry.”

Money is the root of all evil. Said one developer, “Someone once told me the Golden Rule really is, ‘The guy with the gold makes the rules.’” Scott Miller, 3D Realms co-founder, states it just as plainly. “The dirty secret is: Publishers con-trol developers through payments. Rockstar was paying Human Head so late on the milestones payments [in the early days of Prey] that 3D Realms was jumping in to help Human Head because they had payroll to meet. [Rockstar] even said to us, ‘[You’re] taking over the control [we] have over developers.’ Nasty stuff like that happens all the time.” For its part, 3D Realms is helping its fellow developers by offering creative and financial assistance on projects.

Naturally, the money that publishers pour into a project entitles them to have some say. These suggestions can run the gamut of good, bad, and ugly. “When Prey was being developed early on it was actually a Rockstar-label game,” ex-plains Miller. “At the time, Metroid Prime was going to be released, and they had the whole visor thing, and this pro-ducer [from Rockstar] said, ‘Well, the visor is going to be a big thing for Metroid, and we should have a visor for Prey.’ And it didn’t fit anything to do with the game at all. So it ended up where we were rejecting all these crazy ideas, and for that reason along with some others, Rockstar ended up dropping the game because we were too hard to work with.”

The headaches that developers have to put up with involving money, creativity, control, and time, the publishers have in the form of risking millions and millions of dollars. While we’ve illustrated how developers can be hamstrung by the milestone process, this common form of development doesn’t help publishers either. They have to commit a large sum of money up front to a project that everyone knows might not be any good, has too short a schedule to being with, or could change substantially by the time it releases. It’s like paying several million dollars for a single lottery ticket.

Sometimes publishers’ fears are wholly justified. Wanat told us a horror story?– which he says happens all the time?– of a developer who took the money from a publisher for a project. Unfortunately, little progress was being made on it. Suspicious, Wanat investigated and discovered that the developer was letting his game idle while it was using the pub-lisher’s money to fund a secret project it was working on all along. It wasn’t until Wanat sent out an associate producer to literally oversee day-to-day operations (through a series of surprise visits) that work was completed on Wanat’s project.

At this year’s GDC Burning Mad rant session, Lee Jacobson, vice president of business acquisitions at Midway Games, told the crowd of developers some of his own experiences. One tale involved a studio head that kept $300,000 in mile-stone money for himself and then told his own employees that Midway never sent it. Jacobson also told a story of a visit to a developer who said it had devoted two teams to his project. Jacobson met the first team and then went to lunch. When he came back to meet the second one, he realized that it was made up of a bunch of members from the first team who were pretending to be different people by wearing different clothes.

Publishers’ worries about developers are reflective of their need to focus on the bottom line. Plenty of publishers are pub-licly traded companies, and are therefore beholden to the people who own their stock?– people who demand consistent profit growth. The vicious circle of needing to sell more and more copies?– not only to pay back the initial advance the developer was given, but to placate shareholders?– is strong. Mike Wilson, CEO of publisher Gamecock, says it’s a never-ending trap. “They have to perpetually show growing profits to their shareholders, and to do that they have to sell more games. No amount of profit will ever be enough.”

The pressure of meeting a release date?– right or wrong?– leads everyone to some very unfortunate situations. If it’s a movie-based game, you can’t miss the film’s launch, and there’s also more than just the development schedule to worry about. “Nobody ever wants to push out a release date,” says Wanat. “People get pissed. You are not making a game in a vacuum.” Publishers’ strengths are providing marketing, sales, PR, and distribution/retail support for developers, and these usually start working on the behalf of a title a year out. Wanat says delays at this stage are “somewhat” acceptable, but when it happens six or three months out, that’s when a serious ripple effect occurs that places the work the publisher puts in at risk.

While every game would benefit from shipping only when it’s ready, there are times when push comes to shove and the game gets hurried out the door. Titles that are sent out prematurely or are running late often skimp on bug-testing and other quality assurance practices that occur later in development. “The money people are like, ‘[Quality Assurance] doesn’t make us any money,’” explains one producer. “‘Shipping this game and selling it to people makes us money. [Developers] being happy after the fact doesn’t make us money.’” Many developers told us this stage is crucial because it’s when a game comes together and gets polish?– which often separates the good titles from the bad.

One developer we spoke to said they once had to intentionally sabotage their own product as it was about to be released to gain valuable Q.A. time. The title had major problems, but the publisher didn’t care. Knowing that the game was about to ship out to stores and that there was no time for a proper fix, the developer submitted the final version of the title and inserted a game-halting bug that forced the publisher to give the developer more time to solve the original issues.

One of the keys to solving these fundamental development problems and creating an environment between publisher and developer that is less acrimonious and conducive to great games is thankfully simple: communication. Communication replaces fear and paranoia with understanding, trust, and respect. To a person, the developers we talked to felt that the more both sides knew about the other the better. Liquid Entertainment’s Ed Del Castillo says that the situation is improv-ing as more people from the development side go over to publishing, allowing a better understanding of what goes on. “I wish there was a publisher/developer exchange program,” he told us. “The guys at Codemasters were in development be-fore. They get it.”

Better communication can make stressful situations like the milestone process a little easier. It allows developers to be more honest about deadlines and the ability to become more creative with their ideas because the publisher trusts the de-veloper’s vision, has a better understanding of how to achieve it, and is more flexible in how to make it happen. On the flip side, developers would understand the business realities the publisher faces. A closer relationship like this already exists between good publishers and developers, as well as between publishers and their internal studios, where the pub-lisher isn’t treated as just a bank, but a partner.

Part of this communication has to include working with the publisher’s marketing department as soon as possible. In this way, a developer can sell the marketing professionals their vision of the game so they can turn around and sell it to oth-ers. “A lot of people are like, ‘We need to hide from big, bad marketing.’ Bulls---. Marketing’s a part of the process. Rope them in early if you want them to be great,” observes Wanat.

Gamecock’s Mike Wilson is in total agreement. “A marketing department should be just slightly behind the developer itself in knowing where the game is at and where it’s headed. The simplest idea of just playing the game often times just never happens.” Marketing can also prevent a developer from getting tunnel vision on an expendable feature, for exam-ple.

Developer Clinton Keith is a proponent of an iterative game development method known as “Scrum,” which, in his opin-ion, fosters better communication and changes the typical development cycle entirely. Scrum focuses on creating play-able, full-featured game releases from the beginning. This is in contrast to traditional development, where all the moving parts aren’t interacting with each other until near the end. Scrum allows publishers to see a more fleshed-out version of a game earlier (and thus mitigate risk), and offers flexibility to a developer. Instead of trying to decide what a game is on paper at the beginning of the cycle and adhering to that throughout development, Scrum aims to let the game itself show where it needs to go.

Keith says that Scrum is a revolution that actually occurred a long time ago?– with Nintendo. “I’ve worked first-party with Nintendo, and they refuse to read anything you send them. We worked with Miyamoto at Angel Studios, and he would just show up once every three months and look over your shoulder and give you a couple poorly pronounced Eng-lish sentences, but it was really pure wisdom. Basically, they’d pay you for another three months and then go away. A lot of times, he’d say, ‘Find the fun.’ And so, that kind of became our motto.”

Why doesn’t everyone use Scrum? Like any process, it’s simply not for everyone. Ironically, failure is a huge part of the method, because if you can’t execute it, Keith says you’ll find out right away. First of all, it’s better to find out your game’s not fun early on and not a couple months before its release. “By failing fast on an idea you can preserve the rela-tionship [with a publisher] rather than someone being upset about losing eight million dollars. Maybe half a million dol-lars was spent with a small team prototyping an idea and proving themselves, and they can go onto a different idea, pre-serve the relationship and not lose that much money.”

Of course, if a developer didn’t have to rely on a publisher’s money in the first place, then many of their problems would solve themselves. Developers could take their time making a game since milestones wouldn’t be as important. BioWare and Pandemic used cash from venture capitalists Elevation Partners to fuse into one big super studio, while Brash Enter-tainment is entering the industry with capital from equity firms (see page 16 for more). There doesn’t seem to be any one golden road to financial independence, but right now there is a lot of outside money trying to find its way into the game industry.

Another possible route is to change the advance-against-royalties model. With more evenly dispersed payments, devel-opers wouldn’t have to worry about not getting money after a project ships because there are no royalties?– which is al-ready common, as many games don’t turn a profit as it is. Not having to worry about there being no light at the end of the tunnel creates incentive for studios, stability, and less of a feast-or-famine situation.

Method Games’ Michael John, who was the lead design on PSP’s Daxter (working with Ready at Dawn) says that change can also happen on the individual level. John advocates that more developers become free agents like him, selling their experience and skills to studios on a project-to-project basis. This would mean that studios wouldn’t have to spend their money reserves to retain valued employees between projects when the publisher milestone money is not coming in.

With studios being able to operate on lower overhead costs at the beginning of a project (adding free agents as they need), publishers won’t have to risk such an initial investment to jumpstart a project. “People say, ‘Publishers never take risks,’ explains John. “Well, you know what? That’s because you’re giving them a really, really bad bet.” For their part, individual developers like John can pick and choose the projects they want to work on and avoid the office politics. John has already signed on for God of War: Chains of Olympus for the PSP.

The future of game development has to look different than it does today. In fact, major change is already happening. Pub-lishers and developers are refining their methods to remove the pitfalls and paranoia of the process and trying to ensure that the games we play are fun. And as Wanat succinctly puts it, “That’s the only litmus test that I give a s--- about.”

That Joke Isn't Funny Anymore

Licenses are the great four-letter-word of video games. They often create rushed development schedules (to coincide with a movie’s release, for example), which cause them to be bad. Industry insiders tell us that with movie licenses in particu-lar, good sales don’t even correlate with a good game, they simply mean that people like the movie. However, with more collaboration between developers and filmmakers from the start of a project, and as respect for video games increases licensed games are slowly improving.

Publishers making creative demands on developers is such a fact of life that not one person in the industry we talked to even disputed it. The question becomes: What is good advice and what is bad advice. Producer Pete Wanat says “it’s good to want things,” but it’s up to him to take a stand. “No. No matter how bad you want a mine cart rail level, we’re not going to put it in.” On the other hand, developers have to rely on a publisher’s strength?– its marketing depart-ment?– not to jump off into the deep end and put time and effort into features that aren’t important.

The current money-for-milestones structure has some developers living check to check, but this way of doing business isn’t good for the publisher, either. “People need constant reality checks to see if a relationship is working or not,” says Liquid Entertainment’s Ed del Castillo. “Sometimes you have unscrupulous developers who will take advantage of a situation and under deliver again and again.” Whether it’s a developer taking an advance and literally running away with it or a publisher not being able to see the woods for the trees and causing a studio to work on a schedule that’s too short, more developer financial stability eases the milestone structure for everyone’s benefit.