Developer/Publisher Split

Discussion in 'Public Game Developers Forum' started by Tom Ward, Oct 9, 2012.

  1. Tom Ward

    Tom Ward New Member

    Oct 9, 2012
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    2D Animator and Graphic Artist at Ghostbox
    Brisbane, Australia
    Hey All,

    I'm part of a little group of guys from Aus almost ready for our first real release on the store and were hunting around for a publisher. We found one that was wanting a 60-40 split which we thought sounded steep to say the least. Is this the norm?
     
  2. windrider07

    windrider07 Well-Known Member

    May 8, 2012
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    It really depends on the publisher. There are factors that allow a publisher to do a 60:40 split, 60 for the developer, 40 for the developer and factors that force the publisher to do 50:50 split. Yes, it costs money to develop games but it also costs money to market games on a consistent basis and do customer service and community management. If a publisher has a lot of games and is big, sure 60:40 will sound good but it also depends on how well their games are going. Games that will be successful on a long-term basis will generate a lot of revenue but there's no guarantee.
     
  3. PikPok

    PikPok Well-Known Member

    Nov 26, 2009
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    Wellington
    Depends entirely on what the publisher is bringing to the table.

    PikPok publishing deals are in the 60/40 to 80/20 range in favour of the developer, but it depends on a number of factors including cash advances, scale of production support, risk etc.
     
  4. Tom Ward

    Tom Ward New Member

    Oct 9, 2012
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    2D Animator and Graphic Artist at Ghostbox
    Brisbane, Australia
    The publisher we have interested seems very small from looking at the number of games published. We will send them some follow up questions to see what their plans with publishing were. Thanks for the help!
     
  5. Tom Ward

    Tom Ward New Member

    Oct 9, 2012
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    2D Animator and Graphic Artist at Ghostbox
    Brisbane, Australia
    That's really interesting to hear from an actual publisher. What they offered within the 60/40 split seemed pretty bare bones and we feel we could tackle most of the stuff offered ourselves. In saying that, it's only because they also seem very new.
     
  6. windrider07

    windrider07 Well-Known Member

    May 8, 2012
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    The question isn't about how many games has the publisher published. The real question is: how knowledgeable is the publisher in marketing a game and providing customer services to the game. Company A can have 20 great games while company B can only have 3 games. Company B might have a better reputation because it has years of marketing experience and better games than Company A. So it depends on the quality of games and experience. Publishers specialize in marketing and promotion, however developers can also hire people that specialize in marketing and promotion but this only applies to developers who are looking into being both a developer and publisher in the near future. PiPlay.com offers 50/50 revenue share and offers marketing, customer service, and can negotiate on anything else (PM me for more info).
     
  7. Tom Ward

    Tom Ward New Member

    Oct 9, 2012
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    2D Animator and Graphic Artist at Ghostbox
    Brisbane, Australia
    True; thanks heaps! Very insightful.
     
  8. PikPok

    PikPok Well-Known Member

    Nov 26, 2009
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    It is very much to do with how many games a publisher has published. If a publisher has only published a couple of titles, then in all likelihood they don't have some or indeed any of these things which are important to the publishing function

    - data, experience, and understanding of the nuances of the App Store and how to influence it
    - a sizable install base to leverage cross promotions
    - established relationships with Apple and journalists
    - mature infrastructure to support production and post release activity
     
  9. danien

    danien Member

    Oct 5, 2010
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    Singapore
    60/40 sounds high if you have a completed game but as others have said, it all really depends on what the publisher brings to the table.

    In any case, try to be as specific as possible with what the publisher will do in terms of marketing and the timeline for these activities: which review sites/press contacts they will push your game to; where will they be buying ads, how many, for how long, how much will they spend; the breakdown for all of these activities for each region of the world (most are not able to cover global markets effectively despite what they say); who handles community management, press inquiries, etc. Make sure that proof of these are part of your contract.
     
  10. windrider07

    windrider07 Well-Known Member

    May 8, 2012
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    A publisher can be very small but they can still hire someone who does have everything you mentioned. If you hire someone with "data, experience, and understanding of the nuances of the App Store and how to influence it", someone who has partnerships with companies who have "a sizable install base to leverage cross promotions", someone who has "established relationships with Apple and journalists", and someone who has the experience and the ability to grow a "mature infrastructure to support production and post release activity", then a small company should never be overlooked or underestimated. There are people who are immensely connected and talented and will work for a decent salary just to help a small company out. Sure, it helps to have a lot of games and have a big platform but it takes only one game and a great team to make something go big.
     
  11. PikPok

    PikPok Well-Known Member

    Nov 26, 2009
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    Some measure of talent can be hired in, but hiring someone who can tap install bases of others is not the same as owning an install base. Hiring someone with the ability to grow infrastructure is not the same as having infrastructure.

    And even if talent has been hired in, has it been demonstrated in the context of that publishers operation?
     
  12. windrider07

    windrider07 Well-Known Member

    May 8, 2012
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    In most cases, the publisher will adjust it's strategy to accommodate what the new talent seems best. Owning an install base is great and so is having an infrastructure. But yea, it all depends on what games a publisher has, their track record, their familiarity with the market, and what they can do.
     
  13. BazookaTime

    BazookaTime Well-Known Member

    A big advantage of a well know publisher is the customer base they bring to the table. While that alone will not guarantee success, it will put your game in front of a lot more potential buyers.

    This may be harsh but I don't really see the benifit of an unknown publisher that wants a split of the profits.
     
  14. psj3809

    psj3809 Moderator

    Jan 13, 2011
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    If it was me i would go with the 'big' publisher even though it might mean at the start less percentage. A big publisher on iOS can release seemingly anything and it'll have tons of downloads/purchases due to the name alone.

    I see so many smaller games which are very good but as the publisher arent well known its often word of mouth to get people to see this great game and download it.

    If it was me i would prefer to 'get my name out there' by going with a bigger publisher.
     
  15. HeliApps

    HeliApps Well-Known Member

    If I go to a "publisher's" website and they have no really successful game I wouldn't try to get a deal with them even if the split was 90/10 in my favour ...

    I could definitely see the benefit of getting a deal with PikPok or another publisher with similar past success.
     
  16. Zenout

    Zenout Well-Known Member

    For sure you deserve a bigger cut.

    I self-publish and risk my business, and complete livelihood. Chances are my next game will absolutely ruin me.

    So which publisher has that risk when they can sell snow to Eskimos?
     
  17. MarkFromBitmenStudios

    MarkFromBitmenStudios Well-Known Member

    Apr 4, 2011
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    IT Architecture, Development Project Manager
    Austria, Europe
    #17 MarkFromBitmenStudios, Oct 9, 2012
    Last edited: Oct 9, 2012
    I'd even say it's pretty much the only advantage and I agree it's substantial.

    However, I have to say a few words on those splits. Let me look at traditional console game development where there's a developer, publisher, platform holder, retailer, media manufacturer, etc. who all want their shares.

    On average, from the money you pay for a game, the publisher keeps 20%, 12% go into advertising, 6% into media manufacturing (DVD, box, etc.), 14% usually goes to the platform holder (Sony, Nintendo, Microsoft, ...), 32% for the retailer, which leaves 16% for the developer. This is on average like I said, so your mileage may vary but averages are a good starting point.

    So how does that convert to the AppStore market?

    First of all, the retailer is Apple (AppStore) and they already take 30% so that one is already similar. The costs for the platform holder (iOS developer membership) is neglectable. Media manufacturing does not apply (it's all digital).

    That leaves a 2:1 split btw. publisher and developer assuming the publisher spends roughly a third of his part directly on ads. That basically means 2:1 in favor of the publisher, right?

    So it's all cool and standard business, and if you get a 60:40 deal, then you are already marginally better off than what's usual in console business, isn't it? And what's good there can't be wrong here, right?

    ...

    You can't be more wrong. In traditional console development, the publisher holds all the risk. Project canceled? The devs still got payed till then. Product does not sell? The publisher loses money. They need to make a markdown reserve (the publisher needs to pay his share when the product is on sale, not the dev).

    That means, all the risk and upfront investment is with the publisher. Now let's compare that to the AppStore world and the situation of an Indie looking for a publisher. Here, all risk and upfront development costs are with the developer yet you still get a 60:40 share? I mean wtf? That's just nuts.

    In all traditional business, the one who holds the risks or invests the up-front money gets the biggest share.

    I'm not saying don't go with a publisher because at the end of the day, it's just a matter of how much money you can make from your game but the splits they offer are insane and seem to be a carry over from traditional console business that simply does not apply to the new market.

    So, splits should be far more in the devs favor (unless they fund your project).

    Overall, after the initial gold rush for the devs, now with decreased visibility it's the gold rush for the publishers. Apparently, devs are so desperate to get more exposure in this crowded market and thus accept ridiculous terms. Also, devs are known for being bad at selling, negotiating or business in general so they are easy to outsmart.

    So, everybody who considers working with a publisher should do some assessment of his own game. If you have invested lots of time (=money) and the game is good (according to some honest objective beta testers not your own biased opinion or that of your close friends), then you should be working on your negotiation skills.

    In the software business, unless you buy horizontal market retail software, all list prices are worth jack. In some recent deals in my daytime job (not related to game dev but in software business), we've negotiated 50% off more often than not, sometimes down to 10% of the original offer depending on the position you are in. Our last deal with a supplier two weeks ago for a software license we got 55% off if we order now and 40% off if we order next fiscal year. That means we went from $100k to $45k for that license. Go figure.

    If you have a crappy game or just another puzzle/tower defense/ninja-zombie/angry-bird-clone game then it won't be possible but then a publisher won't be able to do any miracles for you anyway.

    If OTOH you have a kick-ass game that did cost you an arm and a leg to develop, then be persistent. Assuming that you didn't start negotiations the week you intended to submit to the AppStore, this can take a while but in all negotiations, it is important to know how good your best alternative is and the simple fact that you can always self-publish makes your position pretty strong. So, assuming that your game is good, what is their best alternative? Publishing an average app instead of yours which is a rather weak position if you ask me.

    However, self-publishing is a strong position. IMHO, ads are overrated for premium games, most of the time it boils down to viral marketing and word of mouth. A quality game will do kinda well even self published without those tweets to 18k Twitter followers the publisher will do. OTOH, put yourself into the publisher's shoes, those campaigns are pretty cheap for the publisher, so as long as he thinks he'll be making money, he'll seal the deal at a lower split rate too. That alone gives a good game a very good negotiation position.

    Bottom line is, never go for a 60:40 split if you have a quality game. Do not assume that because this is normal for consoles means it is justified for the iOS market. It is not. Know your position and negotiate. It all depends on the game but get at least 40:60 (in your favor) for a low-budget quality game and way lower for a high-budget quality game.
     
  18. frankywhite

    frankywhite Member

    Sep 8, 2012
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    how do you contact the established publishers for mobile casual games (female audience) and do to get the best terms?

    could someone give me a hint on whos the right person at chillingo and at zynga?
    is there some other big publisher out there that could be interesting to know about?
     
  19. mr.Ugly

    mr.Ugly Well-Known Member

    Dec 1, 2009
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    Berlin, Germany
    #19 mr.Ugly, Oct 15, 2012
    Last edited: Oct 15, 2012
    if you play poker with your liveelyhood then thats your fault.. if it ruins you, there is only one to blame and its surely not someone else. when i read such stuff i shake my head in disbelieve.. and ask myself why oh why..


    ontopic..

    working with a publisher can be difficult but also fruitfull.. as an indie you should try it out at least once to see how it works in comparsion to self publishing..

    with the difficulty of visibility in the appstore for indies as it is you either benefit from a publisher or not.. chances are rather slim that your product would have a bigger success on your own than with a publisher..

    maybe your product is so good that you would sell good on yourself.. but you would sell at least as well with a publisher.

    so there is no real downfall going with a publisher, except you worry about imaginary income and need to split your million dollars with a publisher..

    even if the publisher is small and does a rather poor job.. it surely wont be worse than most indies own pr campaign..

    the only thing you should never do it to give away your ip if you have something worthwhile.

    then of course most developers overestimate their product anyway and working with a publisher can be a real wakeup call.. :)

    well good luck to all
     
  20. MarkFromBitmenStudios

    MarkFromBitmenStudios Well-Known Member

    Apr 4, 2011
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    IT Architecture, Development Project Manager
    Austria, Europe
    There are two interesting statements in your post, first of all, a good product will sell with or without a publisher, the question is just do you make more money with or without one. However, this brings it down to what is a good product?

    For that question, you hit the nail with the second statement. Every developer overestimates his own finished project, and by a large margin. After all, he sticked with it till the end which is only possible if you believe in your own game. You have seen how awful it was at the beginning and how it became better over time. And only you know what pain you had to go through to give birth to your beloved child. You grew attached. So of course, it is special!

    For everybody else, it is just another game.
     

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