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Game budgets in 2014 and beyond

Now that GDC is over, we’ve been processing some of the information we picked up at the conference, as well as the AppsWorld conference back in February.  The main takeaway from both events is the sharp increase in game and app budgets, and the rising standard of quality the market expects.

For the sake of comparison, we can look at Glowdot’s 2010 game Rogue Runner.  The first version of the game (which was subsequently followed by many many more) took around 6 weeks to make and cost roughly $15,000 to develop.  In total, with all the content updates and new features, game modes, etc that were eventually added, the cost was quite a bit higher.  But the cost to get to market was about $15k.

In 2010, Rogue Runner had over a million players, hit the charts multiple times, and was very well received.  Although the game continues to be played, in 2014, there’s no way Rogue Runner would achieve the same success.  The bar has simply been raised too high to succeed with such a low budget and quick turnaround.

Last year we completed three games, ranging in budget from $100,000 all the way up to $325,000.  Those budgets are more in line with the current trends, but as we learned at GDC and AppsWorld, other game studios have taken it even higher.

The numbers we heard went something like this: a minimum development budget should be in the range of $500,000 to $1.5 million.  Development time should be around 6-18 months.  Marketing budget, at a minimum, should be $500,000, regardless of development budget.

Whoah.  Whoah.

These weren’t just random numbers spit out by a self-proclaimed “expert”, these were numbers cited by veterans.  People who not only made money in mobile games, but who found success multiple times.

Do we think you need to spend this much?  Well, that’s complicated.  If you have that kind of money to spend, its definitely in your interest to spend it.  Given how competitive the market is now, cutting corners you don’t need to cut is, in general, a bad idea.  But you can develop a quality game for far, far less, as we proved three times last year.  Our most recent game, Playground Wars, was developed over the course of a year (simultaneous to several other projects) for a fraction of the budget range mentioned above, and it easily met and exceeded our quality expectations.  And we released it on multiple platforms (iOS, Android and Mac OSX)  But make no mistake, the game still had a significant budget.  But we know it can be done for less if your process is lean and efficient.

I suppose I can’t wrap up this post without mentioning things like Flappy Bird.  Flappy Bird clouded both conferences this year, and with good reason.  It completely disrupted everything — as we strategize about marketing, budgets and development, as we raise large amounts of money and assemble teams of highly skilled and talented builders, along comes a no-budget game made by a rather inexperienced developer that hits number one and stays there, eventually becoming a phenomenon that inspires an insane wave of “me too” copycats, some of which themselves were successful.  What does that mean?

Well, it means we saw a fluke.  As a colleague said to me during the Flappy Bird phenomenon, “sometimes the world goes rogue”.  Indeed.  One thing I’ve learned over the years is that you can’t predict a fluke, and you should never base your business plan on wild luck.  Yes, sometimes a game or app hits that has no right to hit, but for the most part, a successful software business is the result of efficient and skilled development, planning, and marketing.  Flappy Bird was a phenomenon, but games like Clash of Clans, Candy Crush, and the like are the real winners.  And those games were the result of meticulous planning and pitch perfect execution.

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