Yes, it's another article on Australian game development being at crossroads, but Jason Hill has written a highly informative article for Livewire about the state of the local game industry and the many challenges it faces. It covers the problems of government support, the crippling skills shortage, the industry's history of consolidation and buyouts, and its dependancy on "fee for service" work...
Marsha Thomson, Minister for Information and Communication Technology, says most of the income earned by Australian game developers is "fee for service", a system that stifles growth as the publisher retains control of the game's intellectual property while the developer receives only a modest share of profits."The Australian game industry is at a crucial point," she says. "It is highly regarded internationally, but in the global context it is a niche player existing principally on fee-for-service contracts from overseas companies.
It's not all doom and gloom, and local successes are also mentioned with Micro Forte and Krome Studios as an example model for other companies. Industry notables such as US game developer Jason Rubin (Crash Bandicoot, Jak and Daxter) and Sony's Phil Harrison also chime in about the local game industry...
(Phil Harrison) If you want to compete on the global stage you have to compare and compete effectively with the best of Europe, Japan and the US.... I just haven't seen generally the huge creative passion to build something that's going to shake the Earth to its core. But I believe it has the determination to change.
Bit surprised that no one has posted a comment on this news item, though, I really should be :).
That should read: "shouldn't be."
I don't get it.
Come now, sure you do, just use your brain AC.
I got it :) .. I got it alot. :)
I think Phil Harrision is correct. The local industry needs to strive for excellence a lot more than it does - be that on original games, sequels or licenses. I've worked on a couple of the games in those top 10 lists that have been floating around, I've been in the industry a long time, and I still think we're just learning how to make really good games. Making a big game is hard enough, but making something that is good enough to be both well reviewed and sell well is a huge challenge, and that doesn't happen through CEO platitudes or crap from government bods or bitter staff knife fights in the forums, it comes from teams (from the mgt on down) committing to create games that are best of breed and holding their work to the highest standards - and no-one here in Aus has successfully done all that IMO, although some of the studios are definitely getting close. There's been a few big sellers, a few well reviewed games, but no-one has hit the home run yet (well not since the days of the Hobbit and Way of the Exploding Fist being big news on the C64). I wish all these commentators would stop crapping on about original IP blah blah and focus on the fact that we need to make better games. Plain and simple.
Well said!!
Flex - this is exactly what transpired in previous discussions about this from so called ppl in the industry. Step outside a little. Examine what makes those "home runs", guess what the common denominator is - original IP. You can make the best franchise Hello Kitty game in the world, and theres still only going to be a small kiddy market that is interested: and they rarely care about how 'good' the game is in any case - thats another problem with your perspective from within those walls, There is no measuring stick for good. Whereas there are measuring sticks for doing franchise work vs original IP work, and this is what these people in the article are trying to point out - read it, you might be surprised that there is actually some decent commentry in it, coming form people much more experienced than yourself.
You should read some of the gov release papers about how IP helps with industry growth. Marsha Thomson isnt just making things up when she says ".."fee for service", a system that stifles growth.." This is not something you should write off like you do - it again shows your ignorance to the problem that so many ppl recognise, if only the Aus industry developers themselves would.
Lets see you make a "home run" Hello Kitty franchise-fee-for-service game.. and still explain to me how that will help our local industry improve, when that IP is unrelated to our industry and doesnt provide any serious mechanism for exploiting the IP to improve the industry here. Its been said time and time again.. ignore original IP .. and you will simply be out competed at some stage.. against a cheaper studio.. whether they be Russian, Indian, Chinesse or another Aus developer down the road. Quit closing your eyes and ignoring the IP problem - if you dont the only thing that will go away are the developers.
Well said!!
I'm on hols so I might as well continue to ramble my way further into this discussion.
No measuring stick for good - There is a measuring stick for good as far as publishers are concerned - its called metacritic. And the general level of scores you get there affects the type of projects and deals you can get from publishers. You can argue its merits and relation till the cows come home - but it is used by publishers to gauge your skills as a developer. High metacritic != high sales, but high sales generally does equate to a certain level of metacritic score (mid 70s and above). In general of course, there's always aberrations.
If the government can offer tax breaks to local studios then that's great, but it doesn't have anything to do with developing original IP. I'd rather see tax breaks that help them survive and operate, rather than something explicitly to develop original IP (unless they are planning on giving out 20-30 millions US to one local studio to develop and market their uber game). If you are talking about the government funding games for cultural reasons, in a manner similar to film then that's fine - but its not what provides the gravy for the local film industry (which as an industry has some similar issues of skills vs. cost when it comes to work coming from the US). Of course game financing is nothing like film financing at this point in time, nor is the way film projects are run, so its not the best comparison. Either way the film industry is just as volatile and hit driven as the games industry - if we're just talking about the commercial side of both industries. Arthouse / indy games are something else entirely - their prime goal isn't to make profitable, mass market entertainment.
I don't think there's anything inherent in the Hello Kitty franchise stopping you making a really good, successful game out of it. It has a wide appeal outside of the standard gamers. If the budgets for these games are lowballed and the expectations are low and the target audience doesn't mind what's in the box, isn't the onus then on the developer to take all those pieces, scope the project so that they can make a profit and try and do something interesting with it. Now will it be a watershed project - maybe not, but maybe it will be. Is there any reason say, Animal Crossing couldn't have come in the package of Hello Kitty? That has nought to do with budget and everything to do with the skill of the developers and their ability to work with the publisher.
Now there's nothing wrong with long-term development of original IP, as you argue in the long run its a major way of maintaining a revenue stream, but there's not many big studios out there anywhere in the world who actually own the IP, its mostly in the hands of publishers. But if you do get to own it - you need to have the skills and talent and marketing no-how to make it stick - and I would argue you can learn those skills through work for hire just as easily (and with less risk) than going original IP. Just throwing money and passion at something does not make original IP - you need experience, teams that can work well as a group, you need a saleable concept even if you are selling it to yourself. These are things that do not grow on trees and cannot be bought or provided by govt funding.
Maybe it also has something to do with location - as far as I can tell you guys are down south, and the climate of the industry seems different to up here. Over the last six or seven years we've had a slow and gradual build up across all the local companies, with a mix of projects both original IP and not across them. Then again, maybe its all a house of cards waiting to tumble down and be whisked away to China. That hasn't happened to the much higher cost US or UK industries (which after its implosion a few years ago has stabilized into a smaller set of more stable and bigger companies). Now outsourcing is happening and will increase in segments of the industry for sure - but as far as I can tell that's being offset by the need for bigger teams as we move to the next bigger increment of budgets for next gen projects.
All I want to see in the local industry is companies thriving, making ever better games - and if you think that isn't happening then I think you need to take a bit more of a look around. It may not be happening everywhere, but its happening.
What can we say. A slam dunk! Nothin but net.
Reading that long post, I find nothing that isn't already in agreement, nor anything that really disproves the argument of Original IP being the driving force of the majority of "home runs" for the local industry.
Just seems to be meandering along for the most part, talking about things that are not relevant to the issue as some sort of justification for not trying to achieve more "home runs" in the local industry.
I think it misses the net entirely, in fact I think it is going to bounce off and hit you in the face.
I wouldn't worry about it too much Cynical. Nobody takes any of this seriously. You're a bit confused. It's all "Original IP" to someone somewhere.
I guess it depends who owns it in your view. In your universe if it's not owned locally then it's not "Original IP". Guess what mate, most of those "home runs" you are talking about are not owned locally.
So what does that make them ? "Un Australian IPs" perhaps.
Why not "Real IPs" or even "Fair and Balanced IPs" that's catchy. I personally like "Environmentally Friendly IPs".
No, I'm not confused. I just think that you and others are missing the point entirely. Never mind, I guess some people will never quite get it.
BTW: love you handle. Never new I had a fan club. Next conference you see me at, come say hello ;).
The point here is 'fee for service'. Only way to get away from 'fee for service' is to create your own IP, hence the term original IP.
Only way the Aussie industry will expand is to expand work on original IP. In other words, less 'fee for service'.
Please don't waste my genius ADD mind on semantics.
The plot thickens. Someone somewhere has to pay for it. So how you personally differentiate "original IP" is by who's paying the bills (taking the financial risk).
There isn't really a fee for service games industry. It's just not that black and white. There is a whole range of different types of arrangements. Almost all companies get royalties from the sale of the game at retail. Some companies get better royalties than others, in many cases irrespective of whether or not they financed the development. On average most self financed games end up being publisher financed when the developer nears completion of the game (and nearly always runs out of money).
Royalties from larger more established publishers are worth more than royalties from second tier publishers because of the channel to market (larger sell through numbers, more and better shelf space at retail, generally bigger marketing muscle). Most first tier publishers will not give self-funded projects any more royalties than internally funded games because there is no incentive for them to do so. They don't make any more profit out of the deal, so why bother. There is a tendency to look for second or third tier publishing partners for self funded titles. It's a false economy however. The royalty looks good on paper but doesn't translate into greater profits because of poor channels to market.
There is no finance available for self funded games because of the very high risks involved. Only investors who have little or no knowledge of the industry can be hoodwinked into "investing" in a game. You get better odds at the Casino. That's a fact.
"The plot thickens. Someone somewhere has to pay for it. So how you personally differentiate "original IP" is by who's paying the bills (taking the financial risk)."
Well, thanks for clearing that one up. Really, I thought the funding was created with magic.
"There isn't really a fee for service games industry. It's just not that black and white. There is a whole range of different types of arrangements. Almost all companies get royalties from the sale of the game at retail. Some companies get better royalties than others, in many cases irrespective of whether or not they financed the development. On average most self financed games end up being publisher financed when the developer nears completion of the game (and nearly always runs out of money)."
Wow. Such insight.
I don't think it is being realistic of the local development industry however, nor does it persuade me that developers should not be trying to get more "original IP" off of the ground, as it is a means of them getting higher royalty rates or even getting royalties in the first place.
"Royalties from larger more established publishers are worth more than royalties from second tier publishers because of the channel to market (larger sell through numbers, more and better shelf space at retail, generally bigger marketing muscle). ... blah, blah... The royalty looks good on paper but doesn't translate into greater profits because of poor channels to market."
See comment for last section.
"There is no finance available for self funded games because of the very high risks involved. Only investors who have little or no knowledge of the industry can be hoodwinked into "investing" in a game. You get better odds at the Casino. That's a fact."
So that is why no one invests in game development. Because there is no money in it. I guess that is why no one invests in other forms of entertainment as well, like: TV, film, music, books, etc.
And I thought I was the cynical one ;)
Whats the deal here? A whole heap of Aus industry developers (obvious by their posts) trying to somehow justify the comments made by well informed ppl? This is almost hilarious. Keep those eyes closed Aus devvers.. It'll do you all the world of good. Read the article if you can afford to have your eyes open for a few minutes.
And if you can afford to do some research, read the gov reports on IP ownership in Aus. Maybe you might learn something about the IT industry.. then again very likely not.
And to Anon Coward.. geez man you have ranted that speil so many times. The things you meander talking in around about ways dont address the problems that the article DOES cover. And IP generation is CORE to improving the long term stability of an industry and 'fee-for-service' work is simply a dead end - read the article for crying out loud. And read the Gov reports released over the last year or two talking about the importance of IP in the IT industry.
Stop making out, that because you are in a games company you somehow know all about it, and that you somehow are the master of development - because if you are in an Aus game co - you are not. You are on the fringe of the dev industry at best. You paint eveyrthing with very "eveyrthing is happy-happy joy-joy" and prefer to disguise issues with some sort of silly view that tries to distort meanings. Thats pointless rehtoric, and Ive heard it from so many managers in Aus industry it gives me a good chuckle everytime I hear the "wonderful world of Aus game dev" commentry. The realities are something youd prefer to delay or not addreess.
Put in simple terms, this next-gen of 'booming' game companies you desribe is completely unfounded. It has lead to a shrink in the number of development studios, a shrink the number of in-development projects and on the Aus side, there has been already a number of high flying projects cancelled by the big publishers - and there are more coming. Dont try and tell me everything is all roses here.. when I know for certainty it isnt.
I dont care if people dont beleive me - what I do care, is when industry and government people with a great deal of experience, are pointing out issues, that people spend time trying to dilute the truths. If you want to beleive the watered down "everythings fine" view.. fine. Dont complain when there is a sudden fallout in the industry next year, and certainly dont complain that your fee-for-service wrok is suddenely drying up, and you cant seem to get contracts. The responsibility is in the hands of the game companies here. They are the people that, in the end, will be responsible for peoples lives / jobs / security and whether the industry flourishes or falls. Dont take heed from these peoples words (in the articles) then its on your own head.
Nicely said Grover. Nice to see someone hasn't lost the stamina to try and give an honest appraisal of the situation when most are adamant to keep their heads buried in the sand and attack you for not doing the same.
Really, even the GDAA now pretty much agrees with this reasoning, yet our AC friend seems to want to paint a different picture. Makes you wonder why. Perhaps it has to do with his own studio only undertaking fee-for-service work and work based on established licenses.
Perhaps that is why he wishes to distort the current and looming reality.
Enough said however. This really is a big waste of time. Just look at the title of this news thread, and read the article for yourself if you haven't already. The writing is pretty clear, upon on the wall.
Try all you like to change what it says, but my guess is that you will not have much luck ;).
Oh god not this crap again. Guys (both sides) give it a break. We all know the industry can't be categorized according to these narrow definitions. It's just not realistic.
Whats to catergorize? Read the article - thats all. Denying there is valid important topics of discussion is exactly why all this commentry is bizarre. I wish I could link the Gov papers on IT growth, and the importance if IP - the gov has done a great amount of research. There has been some detailed work done by many people in this area. Its only ignorance if youd prefer not to understand the value of this info.
There are no definitions here - only info, advice, warnings and suggestions. Ignorance is bliss as they say. To ignore, what has been well validated, by gov and industry alike, is a little short sighted? Or just a little bliss.
The original IP debate is a distraction at best. Flex is on the money in saying our studios need to impress on quality of delivery. This is a key driver of profitable sales, which is what being in business is all about. Every game delivered that makes bank builds credibility and improves terms with publishers.
From the article: "only 15 of last year's top 100 games in the US were original properties". If a studio is in a better position to deliver one of the 85 successful projects that are not original IP, as opposed to the 15 that are, they should be proud to do so.
Another thing to consider - it is *very* rare to have the publisher spend the necessary $10 million or so advertising a chart topping game and be able to keep the IP as an independent developer. If you want to keep the IP and not advertise, will you really be better off? And if you don't get to keep the IP, why not deliver a great game with an existing high profile IP? Keep delivering, and the quality, reach and profitability of the IP you are invited to work with keeps improving. And if you hit on an original IP that has all the right qualities to make it successful, it might just make sense to pursue it.
Grover I've yet to read a serious government paper directly related to the aus games industry. We see magic numbers quoted by gov people from time to time, but that doesn't mean they have the faintest idea of how our industry works. They see the big picture, which is that the games industry is this gigantic pie and that they want a bigger slice of said pie (rather than crumbs, which are tasty, but this metaphore is dragging on) in Australia to help offset the export deficit.
If you've got links to any gov reports on the games industry I'd love to read them. I'm skeptical of "IT reports" because I believe the games industry to be unique in many respects and I'm not sure how well "IT reports" map over to our situation. Plus they're probably boring.
Licensed/franchise games have helped grow our industry. Have they stifled the growth of some companies? Most likely. Would their growth have been stifled anyway? Most likely! Fact is licensed/franchise games help employ and train people, providing growth and funding for developers to pursue their own IP.
Of course they generally don't bring in the big $$$ that a decent or ideally great, entirely-owned IP game will, but they help lay a foundation for bigger and better things. I love hearing or reading about stories where a start up makes it big with their first game, but that's in fantasy territory for most startups. Some do their awesome original game then go under once the game ships. Not the greatest business move right there.
The whole "original IP" thing is a no brainer, preach it all you like, people in the industry aren't all closed-minded muppets. It's not like we're all thinking, "wow, thanks Phil Harrison, why didn't we think of that?! That's a genius idea! You've opened our eyes!". Well I can't speak for all in the industry, but I can tell you that wasn't my reaction to his comments.
If the choice is to do "fee for service" work as some love to call it, or pursue a risky "original IP" project which may bankrupt the company due to no publisher wanting to touch it with a barge pole or some other rather large stick, until it's near alpha stage and guaranteed to get the bean counter tick of approval. What was i going on about? Oh yeah, the choice thing. I'd rather see people remain employed, so I wouldn't like to bet the farm unless I had a spare one. Every project is risky unless you're a private entity swimming in cash. Original IP games are more so.
That said.. Just because you don't hear about original IP games being developed in aus, doesn't mean they aren't. A lot of prototypes are shown to publishers and then shelved. They might be potentially awesome and publishers might be thrilled - but then the market might not be ready for another pimp 'n hoes game in 12-24 months time. At the end of the day, it's a business, and the number one goal of any business is to stay solvent - publishers and developers. There are lots of other goals like not to treat your staff like shit, which are all well and good, but the other goals can't exist if the company can't remain solvent.
It's easy when you're successful to spout the obvious, but they're spouting the obvious without mentioning the fine print of all the blood sweat and tears that has lead up to the point of their success. Granted some developers are just bloody good, I'll pay that - good business people, good designers, good everything. Lots of good stuff that came together in harmony and worked. That's lovely. They can afford to f-u-c-k up on an experiment without losing the farm. Such companies are few and far between, but it's what all companies should aspire to become, eventually.
We (well some of us) get what you're saying CF and Gover, but it's-just-not-that-easy you know? Why? Why isn't it that easy? That's the magic question that plagues 90(percent) of developers in the world. It's somewhere between dead weight being retained out of loyalty, publisher politics, market trends, lack of true creativity and WoW. Somewhere in that mess is probably the answer.
Maybe we just need to get better at prototyping original game ideas. Maybe that's the answer and we can avoid the mess above. It's no surprise Nintendo come out with creative games and things when they have an army dedicated to prototyping ideas. Most of which don't make it passed the Miyamoto shit filter or whatever they use, but every now and then one gets through and their fans love them for it 12-36 months down the track. Several sequels later it ends, hopefully.
We don't have the same kind of brute force prototyping luxury, so we have to prototype as efficiently as we can - 1-2 months with a small bare bones team. Artists and designers working within a highly flexible environment without much in the way of coder involvement. That's probably something we should strive to do that could make both creative and economical sense. It's not really something I see getting much attention, but then I'm usually too busy working on some fee-for-service game to notice :)
In all the debating that goes on about original IP, which as AC-G put it, is a distraction at best - you don't get much in the way of constructive ideas, and that's what makes them a distraction at best, and a waste of time and effort at worst.
So hopefully I've been a little more constructive than most. Either way it was a long post with profanity I had to go back and edit (aren't we all adults here??), I had a good chuckle writing it, but still, it was aweful long so I think I'll go back to the occasional cynical one liner posts :)
Do you have any money you can invest in game development? Why don't you put your own money into developing games? How much do you think it will cost? How many investors, if any, will you need? How will you sell it? How much profit will you make?
You are still attempting to redefine original IP in order to avoid addressing the real issues which are stated above. Businesses come and go. If you can't take a punt on your own talents with your own funds then you will never reap the rewards associated with taking the risks. If your business venture fails it doesn't mean you can't create a new one.
It doesn't cost alot of money to create a game, and it doesn't require investors.
The article was to wake people up to the future. Instead of being a fee for service developer, companies should be looking at IP to assist their future existence. Otherwise, how are you going to compete with upcoming Indian, Chinese, Thai, Vietnamese game developers? Good luck....I love outsourcing.
It is true that the majority of studios in AU are not developing original IP but there are a select few that are indeed doing their own stuff. Whether they actually succeed or not is uknown but there are a few moves in that direction its just that many people do not know about them.
kazi - Check out the government report "Reel To Reel" or whatever the spelling was. It slammed the .au film industry for being inept and needing to suckle off the government teat to stay alive, whilst heaping praise on the .au games industry for generating big bucks without relying on the government. It said that games should get the same sort of financial support and investment incentives that film does so that the industry won't be beholden to foreign publishers.
Cheers, found it. It's called "From Reel to Unreal". Dated June 2004.
Tried to post a link but the comment filter won't allow it.
Look kazi just because you arent prepared to look for gov docs providing reports on the health of the game industry and things to do to fix it, doesnt mean they dont exist.
For something very relevant to this discussion try:
"FROM COTTAGES TO CORPORATIONS BUILDING A GLOBAL INDUSTRY FROM AUSTRALIAN CREATIVITY
REPORTON ACCESS TO OVERSEAS MARKETS FOR AUSTRALIA'S CREATIVE DIGITAL INDUSTRY"
Yes big title, but Section 8 and 9 are most pertinent. But hey.. there are a hundred other reports you can read on our industry, just look. The gov has done alot on this area.
Importantly myself and CF have never mentioned that what these reports suggest, and the idea of generating more IP is easy, or cheap, or even doable. But what most of the reports state and show, is if the industry DOESNT take a long term view, they will suffer the consequences. Which imho is far too late now anyway. And I have often mentioned ways that could allow these changes to occur, and I am sure there are many other possibilities - the important thing isnt sitting there and saying it cant be done, but to have a proactive group that pursues these gov recommendations. The GDAA should have started this, the day that above one came out, but it hasnt, and its still working along the lines of garnering support from overseas companies to invest here in fee-for-service work. Thats a fine interim.. but its no long term solution.
There are a couple of studios that do have original IP. But thats not the point. The important thing is to develop a solid IP source, that people around the world come to use. Ala the holywood type scenario I have mentioned. Where you have a solid, reknown source for high quality IP. You will always have companies in some way generating IP.. but the problem is most of this is done off the back of fee-for-service work. If that drys up - the IP is gone anyway.
Go to the gov website - do searchs on reports of digital media. Youd be surprised what you will find. The gov is far more informed than the majority of our own industry members.
Heres some reports I have already dled and read - there are tuns more:
South Australian Business Vision 2010 - Industry Clusters Program: A Review
Also chapter 6 of the CITA report - do a google for "The games industry is very much focussed on exports. In 2002 it had a".
Look in both local and federal report areas. And look in digital media, film, and entertainment sections. There is alot to read.