Indies are under no obligation to sign with a publisher. They'd hopefully only accept deals where they feel they're getting enough in return. As mentioned by others; this often means having a publisher front development costs
-
Ever wanted an RSS feed of all your favorite gaming news sites? Go check out our new Gaming Headlines feed! Read more about it here.
-
We have made minor adjustments to how the search bar works on ResetEra. You can read about the changes here.
Conversation starts up on Twitter about publisher cuts. Certain indie developers shocked at how common 50%+ Publisher revshares are. [SEE THREADMARKS]
- Thread starter Deleted member 1849
- Start date
I would certainly like them to get a better cut, but I'm not going to tell devs what they should and shouldn't agree to. Good that they're comparing notes though.
Honestly I think they should also talk about the quality of support they receive from a publisher. I get the feeling that varies wildly from publisher to publisher.
Honestly I think they should also talk about the quality of support they receive from a publisher. I get the feeling that varies wildly from publisher to publisher.
Yes because their 88% cut goes straight to publishers not devs. So yes. Also as long as Tim tries to claim he doesn't want to have exclusives while continuing to money-hat for them they will be evil. Also, launching a halfassed storefront in 2019 that would be a joke 19 years ago. So the bottom line is yes. Yes they are. Oh and crunch.
Yeah.
I imagine most publishers wouldn't front all the costs and monetary risks should the game fail for less than 50% of the revenue as it just wouldn't be lucrative enough.
I assume most publishers fund development upfront while the game is in development. So all employees are getting paid for their work. I'm willing to bet dev costs plus marketing eats up most of that 50%,.
From my experience some publishers want to help with kickstarter campaing, marketing and pr ( you probably have noticed lot's of kickstarters with Hiroki Kikuta music ).
Some want to pay for the whole game and help hire more people. It depends.
Some want to pay for the whole game and help hire more people. It depends.
Just watch Shark Tank. They are not willing to buy in for a tiny share. Publishers are in a much riskier position, it only makes sense they would ask for a large percentage.
I cannot fathom how anyone actually working in an entertainment industry could be this ignorant of how publishing works in every entertainment industry.
Work with a book publisher because you've got a hot novel? They're gonna take a giant cut to cover marketing, distribution, PR, cover design, shipping, etc.
Work as a musician and sign a contract? There's gonna be a huge cut taken for marketing, distribution, PR, design, recording equipment, etc.
Every single creative industry works this way, some more predatory than others (musicians historically get fucked hard, whereas film and TV do better by dint of unionization). Self-publishing is an obvious option but one that comes with a million potential downfalls, but at least it's now an option.
Work with a book publisher because you've got a hot novel? They're gonna take a giant cut to cover marketing, distribution, PR, cover design, shipping, etc.
Work as a musician and sign a contract? There's gonna be a huge cut taken for marketing, distribution, PR, design, recording equipment, etc.
Every single creative industry works this way, some more predatory than others (musicians historically get fucked hard, whereas film and TV do better by dint of unionization). Self-publishing is an obvious option but one that comes with a million potential downfalls, but at least it's now an option.
At the risk of sounding like a corporate bootlicker, that doesn't sound too crazy to me if a publisher commissioned and funded the game in question. Even beyond that a publisher can provide services and take on risks that a developer might find worth giving up revenue share for.
Last edited:
Didn't the Cuphead brothers mortgage their house to complete their game? Don't think most indies are able/willing to do that. In come publishers.
If the publisher is actually paying you during the development of the title and then also for marketing, game conference visits, other expenses, etc, then 50% of the final product sales going to them seems fine to me.
In that situation they're taking a lot of the financial risk and providing funding for potentially years before they see any return, for a product that often doesn't sell many copies (things selling like Undertale is the exception by far).
In that situation they're taking a lot of the financial risk and providing funding for potentially years before they see any return, for a product that often doesn't sell many copies (things selling like Undertale is the exception by far).
If it meant getting the PR and assistance a publisher provides it makes sense for indies to be honest.
I don't know all of the working pieces but say I run a studio of me and a few people working on a single game. We have no legal team, no trademark team, no PR team beyond like social media (which is a crap shute now) and other stuff.
A publisher could provide:
1. Advertising/marketing
2. Support for PR in general
3. Legal team or other advisory depending on the pub
4. Providing more avenues to show and demo your game
5. whatever else a straight dev team themselves may not have the budget or abilities to handle smartly.
6. Possible losses? (not sure on this one)
I don't know if that also includes customer support and/or other problems/assistance as I've never published a game. I'd love to have someone chime in with all the things a publisher provides to help contextualize it rather than jumping the gun at it being extortion. At first my reaction is "that's too much" but then I think of how little I'd be able to handle the stuff outside of game dev and go "Oh yeah 50% to keep that shit off my shoulders? Okay"
I don't know all of the working pieces but say I run a studio of me and a few people working on a single game. We have no legal team, no trademark team, no PR team beyond like social media (which is a crap shute now) and other stuff.
A publisher could provide:
1. Advertising/marketing
2. Support for PR in general
3. Legal team or other advisory depending on the pub
4. Providing more avenues to show and demo your game
5. whatever else a straight dev team themselves may not have the budget or abilities to handle smartly.
6. Possible losses? (not sure on this one)
I don't know if that also includes customer support and/or other problems/assistance as I've never published a game. I'd love to have someone chime in with all the things a publisher provides to help contextualize it rather than jumping the gun at it being extortion. At first my reaction is "that's too much" but then I think of how little I'd be able to handle the stuff outside of game dev and go "Oh yeah 50% to keep that shit off my shoulders? Okay"
Includes games which are already finished, and therefore do not always include cost of development.
OP
OP
Given it's all indies in the twitter discussion, chances are none of them are being commissioned or fully funded by publishers. They are talking about signing with types like Devolver, Good Shepard, etc after most likely a lot of the work and funding on the game is done.
Yeah I guess what I'm getting at is the quality of 'non-monetary' support. Jerking devs around on milestones, shitty marketing etc. Purely anecdotal but I've seen some real shit support from pubs in the past.
If you're so loaded with cash that you can cover all your costs for the time it takes to make your game, and could survive if your game then bombs and doesn't make any money, then I guess it makes sense to self-publish.
Most of the time it makes more sense to get a publisher.
Yeah that makes sense. I'm not one to praise corporations but understanding the risks and other parts that publishers play in the deal and how hard (borderline impossible) it is to manage to get a certain scale of success without a lot of help given how inundated the market is for games and pretty much anything in the age of the internet I'm not instantly angry yet.
Our game Skellboy technically wouldn't need publishing if it weren't for the Switch version.
We could (and plan to) self-publish on Steam, but it's not easy to get your first (few) games onto the eShop.
It's not impossible, it may not necessarily hard, but there can be a barrier if they're not convinced.
Our publisher helped us immensely with that and brought us and the game to where we are now.
If it weren't for them, Skellboy probably wouldn't release on Switch.
That said, I'm very surprised to see that a 50+% cut is apparently normal for publishers.
I don't know many publishers' cuts, but the few that I know of take less than 50%.
Which didn't mean that I consider these Twitter posts a load of bollocks. It's just fascinating that Indies are willing to take those terms.
Last edited:
e: my bad misunderstood the thread, thought it was indies - those not published - being surprised at publisher cuts in general in the industry. Oh well, that's what I get for not clicking the individual twitter accounts and not recognizing any of them. :p
Last edited:
You're ignoring the fact that A) this has nothing to do with Epic, B) publishers are going for Epic deals more often than not and pocketing that money, since they're the ones who assumed the risk of the product
OP might want to put that this is primarily about indie titles in the title / more reinforced in the OP since everyone seems to be coming in acting like you're talking about the AAA industry.
Edit: NVM the title is clear enough, people just aren't reading lol.
Edit: NVM the title is clear enough, people just aren't reading lol.
OP
OP
A lot of the people in the Twitter thread are very well respected people, so it's definitely not.
Yeah... I noticed this too.
Interesting post on revshare agreements
Hi, someone who doesn't do third party publishing currently, but has worked alongside of a lot of pubs/devs that do. Personal thoughts, not Riot's!
Many, but not all, revshare agreements between a publisher and developer have the split based on how much equity & resources the dev requires, and what the publisher believes the opportunity cost affords in ROI. A 50% split+ usually (but again, not always) means there's conditions like a dev studio requiring additional advanced funding to get the title made, depending on where in development & the scope of the title, in which the publisher takes on more risk in investing. In these cases, the risk is mitigated by the publisher by a higher revshare %. In cases where the developer doesn't need advances on revenue, to my knowledge it's pretty rare for the publisher cut on revenue to be astronomical unless the developer isn't (or doesn't know how to) shopping around for publishers.
I really want to stress that "the publisher's capital equity investment" part, because that's really how many big and mid-tier publishers view the risk/reward on ROI. As long as I can remember, investors and publishers generally have the upper hand in this negotiations not out of cruelty or greed necessarily (although there definitely are publishers that are absurdly greedy IMO), but because there are a billion aspiring & proven dev studios & teams that have a billion great game ideas, and if one studio has significant capital requirements to get it's game into the market & wants only the publishers to take 30%, well, there's like hundreds of other studios that probably need less capital and would *kill* for a 50/50. There's a lot of nuance in that rev share split though: one big example is when you're an established leader or team of developers that is setting out on your own, or a mod team that is getting into making your first big game, or even a completely unknown development team that also happens to have a KILLER prototype. There's a lot of nuance, and as to what is a right rev split really is complicated IMO, but much like all modern day businesses, whoever controls the operating capital generally has the most favored terms because of their "risk".
Additionally (but again, super not always!), the games publisher represents the actual work of publishing, which can represent actual cost centers the dev might not be able to do. This can include various degrees of marketing, distribution (ESPECIALLY working with first party & digital platforms, in many cases, and even more so as asia & mobile become more of a thing in the west), certification, localization resources, customer support, legal (this includes trademark, copyright & IP enforcement), and even brand equity (i.e "if you get published by us, that grants you a lot more credibility than other publishers"). This is where a lot of weird math can come into play on revshare (or even IP control), but the tldr in my personal experience is "you get what you pay for, as long as you do diligence on the publisher's efforts".
Finally, and it's kind of an aside, but publishers can help significantly with how the title is distributed & "placed" on platforms (think consoles, mobile stores, Steam/Humble/EGS, etc), but with rare exception it's not common for the distributor to publisher/developer to be significantly changed, unless we're talking AAA schanigans or platform exclusivity terms. It's easier than ever for a studio to get their game onto most playable platforms all by themselves (assuming they have the capital, can deal with cert & the other platform requirements!), so most of the publisher's work focuses on the distribution terms: stuff like when and how long a title is promoted on certain areas of a digital store, or if the distributor will pay for an exclusive trailer, or better sales terms, etc etc.
Since I'm not actively involved in third party publishing, not too much I could share in the actual sausage making, or even deep thoughts on what a right or wrong split looks like (although I mostly advocate developers having the most favorable terms possible). Hope this adds some context!
Many, but not all, revshare agreements between a publisher and developer have the split based on how much equity & resources the dev requires, and what the publisher believes the opportunity cost affords in ROI. A 50% split+ usually (but again, not always) means there's conditions like a dev studio requiring additional advanced funding to get the title made, depending on where in development & the scope of the title, in which the publisher takes on more risk in investing. In these cases, the risk is mitigated by the publisher by a higher revshare %. In cases where the developer doesn't need advances on revenue, to my knowledge it's pretty rare for the publisher cut on revenue to be astronomical unless the developer isn't (or doesn't know how to) shopping around for publishers.
I really want to stress that "the publisher's capital equity investment" part, because that's really how many big and mid-tier publishers view the risk/reward on ROI. As long as I can remember, investors and publishers generally have the upper hand in this negotiations not out of cruelty or greed necessarily (although there definitely are publishers that are absurdly greedy IMO), but because there are a billion aspiring & proven dev studios & teams that have a billion great game ideas, and if one studio has significant capital requirements to get it's game into the market & wants only the publishers to take 30%, well, there's like hundreds of other studios that probably need less capital and would *kill* for a 50/50. There's a lot of nuance in that rev share split though: one big example is when you're an established leader or team of developers that is setting out on your own, or a mod team that is getting into making your first big game, or even a completely unknown development team that also happens to have a KILLER prototype. There's a lot of nuance, and as to what is a right rev split really is complicated IMO, but much like all modern day businesses, whoever controls the operating capital generally has the most favored terms because of their "risk".
Additionally (but again, super not always!), the games publisher represents the actual work of publishing, which can represent actual cost centers the dev might not be able to do. This can include various degrees of marketing, distribution (ESPECIALLY working with first party & digital platforms, in many cases, and even more so as asia & mobile become more of a thing in the west), certification, localization resources, customer support, legal (this includes trademark, copyright & IP enforcement), and even brand equity (i.e "if you get published by us, that grants you a lot more credibility than other publishers"). This is where a lot of weird math can come into play on revshare (or even IP control), but the tldr in my personal experience is "you get what you pay for, as long as you do diligence on the publisher's efforts".
Finally, and it's kind of an aside, but publishers can help significantly with how the title is distributed & "placed" on platforms (think consoles, mobile stores, Steam/Humble/EGS, etc), but with rare exception it's not common for the distributor to publisher/developer to be significantly changed, unless we're talking AAA schanigans or platform exclusivity terms. It's easier than ever for a studio to get their game onto most playable platforms all by themselves (assuming they have the capital, can deal with cert & the other platform requirements!), so most of the publisher's work focuses on the distribution terms: stuff like when and how long a title is promoted on certain areas of a digital store, or if the distributor will pay for an exclusive trailer, or better sales terms, etc etc.
Since I'm not actively involved in third party publishing, not too much I could share in the actual sausage making, or even deep thoughts on what a right or wrong split looks like (although I mostly advocate developers having the most favorable terms possible). Hope this adds some context!
OP
OP
Another interesting thread on the subject:
This seems to be the main issue. From reading the various tweets and threads, it's not uncommon for publishers to offer a 60/40 rev share (pub/dev) for games that are deep in development, with little investment from their part. Considering we are talking indie devs, I wouldn't doubt there are a lot of publishers taking advantage of developers new to the industry, as well as developers that are very bad at business.
This seems to be the main issue. From reading the various tweets and threads, it's not uncommon for publishers to offer a 60/40 rev share (pub/dev) for games that are deep in development, with little investment from their part. Considering we are talking indie devs, I wouldn't doubt there are a lot of publishers taking advantage of developers new to the industry, as well as developers that are very bad at business.
I think it can be the main issue for some devs, but it's certainly not for many successful or experienced ones. As big & competitive as the western games industry is, it's fairly incestuous & social, and devs (including biz dev & studio leads) absolutely share stories and best practices on term negotiation. That said, games development is a living ecology, and each case often causes pretty significant factors in publisher relationships to developer.
One thing I do want to call out, and you aren't wrong for raising the idea btw, but the notion of "being deep in development" often doesn't conflate with "how much money you've put in", but rather "how much more money you need to complete the title to go to market, be it early access or full production". There are plenty of self-funded or crowd-funded studios that have sunk massive amounts of equity ($, time, brainpower, tech) in building a game that for whatever reason (and there are a LOT of valid ones, including the artistic nature of games, scope creep, project management, natural disasters, personnel challenges, legal stuff) results in a studio being near the finish line but absolutely needing additional capital, and publishers being the only way of generating that cash shortfall.
As a broad example, a recently common studio cash shortfall that has come up pertains to fully or mostly crowd-funded initiatives where the title gets a lot of real progress done, but the realization sets in that hitting all backer targets/expectations AND going out on time AND oh god we didn't realize how expensive cert can be AND a whole bunch of other stuff happens, so a publisher can step in and help get that title out the door, in exchange for a rev split. In those cases, even though the majority of the investment came from the developer, the only way that investment sees ANY ROI for the developer is additional funding, in which the publisher has the leverage to negotiate better terms. This doesn't mean that a publisher will "exploit" the studio in these cases either (there are a few wonderful AA publishers that have a reputation of being exceptionally merciful & benevolent for these kind of late-cash-injection deals), but it absolutely does factor into the terms. Keep in mind too that there are other ways of generating the capital necessary sans publisher (private investment, equity firms, selling off old IP, a bank loan, even credit card shenanigans!), with varying pros and cons to those systems as well.
Oh, one other thing I wanted to bring up before was the idea of opportunity cost, and how many 3rd party publishers view the investment portfolio as it relates to revshare. Something super important to keep in mind when looking at the "business" of publishing is that many publishers have varying degrees of leverage as to how many and how much they invest into titles for publishing. The amount of cash you have on hand is a crucial one to keep track of (ex: you spent 80% of your developer budget on stuff forecasting for launch in 2020, so maybe putting better risk/reward terms on an opportunity to publish a title in 2019 that just crossed your desk is prudent), but also external market conditions (ex: huh it's pretty clear that AAA & first party is gonna put a TON of money on releasing their own battle royales; maybe you need to adjust the risk/reward on revshare for a studio's promising in quality but difficult to sell take on a BR?), internal market conditions (ex: four of the five top proven indie studios are aggressively pitching you titles with great prototypes, the fifth needs little capital but substantial bandwidth of your actual marketing ability) and simple relationship management (ex: EA taking *zero* revshare on some of their indie published titles, because the brand equity of having those titles in your portfolio greatly exceeds the money it would take to acquire that trust by other proven means). This is a super complicated area for both publishers and developers, which is why I stress the part about the onus being on studios to do the diligence regarding terms.
Thanks for the follow up, caylen. I think it's very insightful, and it's also a sentiment I've seen shared by many other devs and publishers in that discussion, that there are way too many factors to take into account when deciding the rev share to offer/accept. As a consumer, I don't get to hear about those deals, as I imagine they are behind NDAs, so it's heard to gauge how much of this reaction is overly dramatic and how much is genuine annoyance at predatory companies.
Concerning your comment about the industry being "incestuous & social", as an outsider, there seems to be a big split among devs, specially based on platform (PC v. Console v. Mobile) and scope (Alternative v. Indie v. AA etc.), and not a lot of communication between those communities, so much so that I wasn't surprised to see a couple of very small indie devs I follow not knowing about those rev shares. Main reason why I appreciate when these topics are raised, as a kind of lesson for those developers that don't have as much experience with that.
I also wished indie devs turned publishers (Chucklefish and tinyStudios, for example), would give their opinion on this subject, as they were created, as far as I remember, exactly as alternatives to publishers trying to abuse small developers.
Concerning your comment about the industry being "incestuous & social", as an outsider, there seems to be a big split among devs, specially based on platform (PC v. Console v. Mobile) and scope (Alternative v. Indie v. AA etc.), and not a lot of communication between those communities, so much so that I wasn't surprised to see a couple of very small indie devs I follow not knowing about those rev shares. Main reason why I appreciate when these topics are raised, as a kind of lesson for those developers that don't have as much experience with that.
I also wished indie devs turned publishers (Chucklefish and tinyStudios, for example), would give their opinion on this subject, as they were created, as far as I remember, exactly as alternatives to publishers trying to abuse small developers.
Funds development, handles marketing, translations. All this costs a LOT OF cash, time and people. You expect to have all this done for a game and developer keep a solid cut of the profits? Unless you're some big indie developer where your name sells hundreds of thousands of copies (in which case you dont need a publisher) i dont see how it is financially viable for the publisher to not try and make or recoup as much of the costs as possible by betting on small or unknown developers. 50-60% still leaves one with 40-50% of the revenue. Which from a non risk point of view is pretty solid.
Publishers wanting 50% for nothing more than their logo on your product and some trailers is crazy.
No, no, that shit definitely happens and is pretty shitty. I just meant in general they do a ton and risk a lot to make sure a game gets out and sells. Obviously there are some shit publishers out there.
Paying a small team of say 5 people for two years is a LOT of money to front like that. Vast majority of development costs is salary.
OP
OP
Chucklefish CEO is in the Twitter thread! His comments are mostly about AAA though, which is odd.
More than just that reply, best to open the comment chain.
Yeouch, that's pretty high.
So, in the end, what percentage of the sales are those studios actually getting? There not just the publisher cut, there like the retailers cut, the platform holders cut, etc. Unless those costs are usually covered by the pubs?
I feel for those working in the video game industry more than ever, it seems like a tough world out there.
:(
So, in the end, what percentage of the sales are those studios actually getting? There not just the publisher cut, there like the retailers cut, the platform holders cut, etc. Unless those costs are usually covered by the pubs?
I feel for those working in the video game industry more than ever, it seems like a tough world out there.
:(
Last edited:
Thank you! I do wish he talked a bit more about the games they've published, and how they went about making the deal. Oh well.
Retailer/platform holder cut first, then the split between publisher/developer on the rest. Getting your game fully funded as well as all the other stuff a publisher provides and still getting a 50/50 split is great tbh. People are not aware of how much work it is to get stuff onto different platforms, its a loooot of work, and I am not talking technical stuff like optimisation.