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Can someone explain "development costs" please

01-31-2010, 09:56 PM
#1
Joined: Nov 2009
Posts: 5,146
Can someone explain "development costs" please

Hi,

So basically, I would like to understand better precisely whats is meant by "development costs" when it comes to iPhone/itouch game production.

Please note, I am not a developer myself and have little to no knowledge of all the technical stuff involved. The reason I'm asking, is because after recently participating in a discussion where the topic of "development funding" came up, I found myself at a bit of a loss as to what this actually meant, broken down into basic, actual components.

Now, I do understand that the bottom line can vary greatly, depending on size of the project, so for the sake of the argument let's take 2 examples. In both, let's assume that development is being carried out by a single person.

In the first example the project involves a port of an existing game to the iPhone platform. Let's assume it is an old PC game or such, circa 1990. Fairly simple graphics by today's standards, as well as relatively small file size. The aim is to port the game as closely as possible to the original. No graphical updates or expanding of original gameplay are required.

In the second example we're dealing with a new game which needs to be written from scratch. Let's assume that graphically the game is modest, as are many on the app store. For the sake of the argument and visualization, let's assume it's an RPG. Something akin to Undercroft or The Quest.

Now, for each of the above examples, would someone please be able to provide for me a breakdown of "development costs?" Roughly, of course, but if possible explaining exactly where any available funds might be going? Followed, if possible, by a rough bottom line for each project.

I'd MUCH appreciate any feedback I can get on this. Thank you.
01-31-2010, 10:06 PM
#2
Quote:
Originally Posted by Gabrien View Post
Hi,

So basically, I would like to understand better precisely whats is meant by "development costs" when it comes to iPhone/itouch game production.

Please note, I am not a developer myself and have little to no knowledge of all the technical stuff involved. The reason I'm asking, is because after recently participating in a discussion where the topic of "development funding" came up, I found myself at a bit of a loss as to what this actually meant, broken down into basic, actual components.

Now, I do understand that the bottom line can vary greatly, depending on size of the project, so for the sake of the argument let's take 2 examples. In both, let's assume that development is being carried out by a single person.

In the first example the project involves a port of an existing game to the iPhone platform. Let's assume it is an old PC game or such, circa 1990. Fairly simple graphics by today's standards, as well as relatively small file size. The aim is to port the game as closely as possible to the original. No graphical updates or expanding of original gameplay are required.

In the second example we're dealing with a new game which needs to be written from scratch. Let's assume that graphically the game is modest, as are many on the app store. For the sake of the argument and visualization, let's assume it's an RPG. Something akin to Undercroft or The Quest.

Now, for each of the above examples, would someone please be able to provide for me a breakdown of "development costs?" Roughly, of course, but if possible explaining exactly where any available funds might be going? Followed, if possible, by a rough bottom line for each project.

I'd MUCH appreciate any feedback I can get on this. Thank you.


like you said, IT ALL DEPENDS! if you can find a graphic artist, programmer, and designer that your paying + $99 new dev toolkit+ at least $700 mac (mini) well then you have to pay each worker. you sell 100 copies, then apple gets 10-20% and i assume you'd split so its alot if your new. but you can find people to help for free, like me!

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01-31-2010, 10:06 PM
#3
Joined: Mar 2009
Location: Seattle, WA USA
Posts: 4,761
http://www.streamingcolour.com/blog/...rutal-honesty/
Quote:
Dapple Costs
I did a presentation for the 360|iDev conference on creating an iPhone game. If you’ve read it, then you’ve seen my “conclusions” section that had some numbers. Dapple took me about 6 months to make and had a budget of roughly $32,000 USD. That budget includes: paying my contractors, business expenses incurred during the 6 months of development, and paying myself a very small salary (akin to what I made as a junior front-end programmer when I first started in the industry).
01-31-2010, 10:29 PM
#4
Joined: Nov 2009
Posts: 5,146
Quote:
Thanks Dave, I read through your initial blog and bookmarked the page to read the additions later. I found it interesting, even if it doesn't address specifically what I was after.

To reiterate as per my post above: we must assume all work will be carried out by a single person (no contracting costs) and likewise can assume that "tools of the trade" such as a mac/pc, dev kit, etc. are already in that person's possession and do not add to cost of development. Would still greatly appreciate breakdown of costs pertaining to my two examples above. Thank you.
01-31-2010, 10:58 PM
#5
In my opinion, development costs simply refers to the "costs involved in developing and completing a specific project". This may include man-hours (spent on programming), music, graphics, testing, etc.
01-31-2010, 11:59 PM
#6
Joined: Dec 2008
Location: Los Angeles, CA
Posts: 232
The main cost is usually man-power. If you're making games as a full time independent developer, you still need to eat, pay rent, bills, insurance etc. These costs will be lower if you live somewhere affordable, or if you're a student, or if you have a full time job and make games for fun in your spare time.

To calculate our development costs, we could figure out roughly what we need to bring in each month (you could base that on an entry level industry salary, for example*), and multiply that by the length of the project. If it's a full time business, you'll also need to account for all the time spent leading into and out of a project - basically any time you spend not doing anything else profitable because you're working on this project, marketing time, design time, whatever.

There are also fixed external costs, like buying music, paying contractors, advertising, etc. If you're just a programmer, or just an artist, you might have a lot of expenses here. If you do both yourself, or have a partner doing one or the other, you'll probably find external costs are small compared to the cost of your own time.

* this article from the Canabalt developer, is good reading on the subject. They used a rough figure of $5000 per month for their time. It might seem a little high to some, it'll seem a little low to others, but if you take into account horrible grown up stuff like tax, pensions, health insurance etc, it's probably a good base amount to use:-

http://www.gamasutra.com/blogs/AdamS...99_Problem.php
02-01-2010, 12:00 AM
#7
Quote:
Originally Posted by Gabrien View Post
Thanks Dave, I read through your initial blog and bookmarked the page to read the additions later. I found it interesting, even if it doesn't address specifically what I was after.

To reiterate as per my post above: we must assume all work will be carried out by a single person (no contracting costs) and likewise can assume that "tools of the trade" such as a mac/pc, dev kit, etc. are already in that person's possession and do not add to cost of development. Would still greatly appreciate breakdown of costs pertaining to my two examples above. Thank you.

There are too many variables involved, and you aren't specific. It would be different if you provided an exact outline and detail. There is nothing to 'break down'. What you are looking for is a bid (technically), but you aren't providing any parameters.

It would be like asking a Building Contractor how much a house would cost to build if it has 3 bedrooms and two baths. And he will certainly include his tools and skill in the bid. That doesn't come free.

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Twitter: @FlickittyiPhone
02-01-2010, 12:01 AM
#8
Man-hours.

Costs are man-hours x $/hr. To be safe, multiply it by 2.

If you have a comprehensive design document, post it up on the various outsourcing sites and get bids. You should get 6+ bids easily. Ignore the cheap bids. They under bid and the costs will be much closer to the high bids in the end. Take the high bids and that'll be around what it'll cost you.

More reputable firms will provide the actual breakdown for you. X hrs for setup, Y hours for feature 1, Z hrs for feature 2, N hrs for milestone 1. It'll all be presented in a nice Excel spreadsheet where you can see exactly where the hrs and $ are going. These are always estimates can tend to be too optimistic. Budget for cost overruns.
02-01-2010, 12:20 AM
#9
Joined: Aug 2009
Posts: 618
Quote:
Originally Posted by Gabrien View Post
To reiterate as per my post above: we must assume all work will be carried out by a single person (no contracting costs) and likewise can assume that "tools of the trade" such as a mac/pc, dev kit, etc. are already in that person's possession and do not add to cost of development.
If you read his posts in detail, that's more or less EXACTLY what he gave you. There were some minor contracting costs (kind of hard to find a jack of all trades who can do graphics/sound/music/programming/3D Modeling all at exceptional levels) but most of the costs were the paper tigers of "this is what it would have cost if I paid myself".

For the question you posed, that is a legitimate concern. Apps can only be made for "free" if you don't count people's time. If you make less money developing an app yourself than you could be reasonably making doing it for someone else, then economically you're losing money.

Obviously there are personal factors of "I just want to do this and think any returns are great", but one needs to approach such a stance with a clear understanding of the position they are in.

If your question truly is, "What's the cheapest I could make a game for myself?", then that depends on your skill level. If you can manage all the assets, all the programming, and have all the equipment, then your out of pocket is $99. ($99 for the developer account.)

Just keep in mind that it is REALLY hard to create a successful game all by yourself. The skills required are so broad that you're likely to end up spending at least some money on contract work. How much depends on you.
02-01-2010, 12:26 AM
#10
From an accounting perspective it's the costs that are incurred during the development of the game. Everything from salaries to keeping the lights on. If the studio is big enough to be working on multiple projects at once it is the proportion of resources that are devoted to your project based on the total resources available.

In your example you already have the graphics, gameplay and the rules of the game worked out. This should cut down on production time significantly, but let's say you're coming in fresh with an idea and the developer has to do everything (graphics, etc.) from start to finish:

I'll give you three examples based on a game that would take 1 month to do, start to finish

1. Guy working full time on the game (this is his only job). Works at home. New to industry but competent. Has equipment already.

Salary: $2400 (based on 1 month for a guy that makes barely $30k a year)
Overhead: $200 (Overhead in this case would be the guy's home office, he works on the game 8 hours a day/5 days a week and uses resources based off that (such as electricity, internet, etc.)).

So the development cost would be $2600 for a super-cheap developer. If you go to a really qualified professional his hourly rate could be substantially higher. This person will tell you, "Hey, I can make this game for $2600" but keep in mind he might actually be working on multiple projects at once.

2. Studio that makes games full time, has 5 developers, 1 of which is assigned to your game.

Developer Cost: $60/hour ($40/hour of that is to cover developer salary, $20/hour is to the business, but that's not your point to contest)
Overhead: $1000 (overhead for a business is much higher, it's the lease on the building, administrative costs (such as manager salary, etc), and all other costs incurred for the business. If more resources go to your game then this cost could go up significantly.

^ Those two costs are given to you in a quote, based on the idea that the game would take a month to create. They would tell you "We can product this for you for $10,600" and you could try to negotiate it.

3. You buy a book on developing games for the iPhone and give it a go yourself.

It'll cost as much as the equipment you need. In this case, if you have a job already, any money this game makes will be bonus income. You then don't have a game that's released needing to reach a break even point.

---

It's all in how you want to get the game done. You might be able to search around for a young kid to make the game for $1000, who knows. Your best bet is to find a freelance person that believes enough in your project to take a cut of the net profits (gross - Apple cut). Activity Based Costing used by development companies can cause your costs to go pretty high, but hey, development companies need to eat too.

I hope this helps, good luck!