The problem is that the returns aren’t good enough to support the risk. With AAA budgets, you need to hit ~top 5 of the year to make any money. That means broad appeal. Broad appeal and experimental do go well together.
I’ve said it before, and I’ll say it a million more times. Until games can be priced such that a mediocre AAA game can see a modestly successful profit, and one flop doesn’t tank a studio, this is the gaming landscape we’re stuck with. When people get their panties in a bunch about how profitable (aka greedy) the games industry is, they completely leave it the part where the overwhelming majority of that is tied up in the things that they hate. The AAA box product model just isn’t paying the bills. GotY does under that model, but the average is not great.
Also, people like to grab numbers without actually understanding the context. I see a lot of, “game X had a $500 million budget, and sold 15 million copies. That’s a 50% ROI, which is huge!” Ok, first of all, they do not take home the full box price, so it’s actually closer to 20% ROI. Second, that cool half-bil was locked into an investment over at least 5 years, making an average yearly ROI closer to the 5-10% range, which is worse than the market average. Finally, games is very boom or bust. There was a very real risk that they only sold a couple million copies, such would have been a massive loss.
So… How risky would you want someone to be if you loaned them 50k, and in 5 years they should be able to give you 60k, but also if things don’t work out you might only get 10k back. The math just doesn’t add up for risky AAA box product games. If 1-5 million copies was the break even point, you’d see a lot more innovation.
If the returns aren’t good enough it’s because we’ve created this landscape where graphics, features, and general technology are so complicated that the cost of making them is incredibly high.
The other issue is something your comment demonstrates perfectly. Games are now primarily business ventures first, art second.
20 years ago the aspirations for studios was to make great games for the arts sake and get paid decent enough to live well so they could keep doing it (this model still exists in the indie game landscape and does quite well). Now it’s all about ROI percentages and lining CEO pockets with ridiculous salaries and bonuses. Just like every other industry that’s become complete unbalanced with runaway capitalism.
The game industry has become completely warped by this paradigm. AAA Games now exist purely as a business venture. Giant companies have acquired almost all of the smaller studios so this mentality is all that is left.
“How can we innovate and make great art while getting paid” has turned into “Will this product return the investment to shareholders”. That is now the sole purpose in gaming studios today. It actually being a good game is just a secondary bonus that might mean better investment opportunities with it in the future.
Of course this is not just an issue with the video game industry. Obviously it’s part of the greater issue of the type of runaway greed that this system encourages. This has infected most industries now. Its part of why things are so out of balance between the worker and the c-suite execs.
TLDR: Giant mega companies who’s only purpose is to make insane amounts of money bought out all of the studios that used to have a balance of creating great art and getting paid enough to keep doing it.
I don’t think that’s entirely fair. You can begrudge the big budgets all you want, but the market had proven time and again that that’s what players want. If a studio doesn’t get the indie pass, players are all over them for being “lazy” and cutting corners. “You’re a big studio, with plenty of money. You can afford to do X, Y, and Z. Stop being so greedy.”
My point was that we’ve entered an age where player expectations are so divorced from reality that there’s just no winning anymore. Any studio that isn’t perceived as “indie” enough is expected to spend hundreds of millions of dollars developing the new blockbuster. Even then, when such a studio releases a massive hit expectations skyrocket. Developers have ambitions, and ambitions cost money.
No one is going to argue that greed isn’t driving some parts of the industry, but it’s not that simple. If you’re a billionaire and want to patronize a development studio to make a game for the artistry of it, think about what happens. You front the hundreds of millions of dollars. Best case scenario you’re not totally regretting doing that instead of sticking your money in an index fund. You make your money back, and can re-invest it in the next project. Worst case scenario you burn through the cash and don’t even have a finished game to show for it before you have to pull the plug length hundreds of employees in the lurch (this has happened). Average case you release a mediocre game for a niche audience and lose money.
Best case scenario you get to do it again. Most likely the you can afford to fund one big artistic vision and then the money is gone. A healthy business gets to keep making games. The games people want haven’t been disappearing because of some opportunity cost gobbling up all the game development resources. They’re disappearing because the profit is so low that one wrong move and the non “greedy” investor is out of money.
The industry will start producing more niche, artistic, and interesting games when it the average case is actually profitable. Until then they’re going to have to keep chasing the cash cows just to keep the lights on. The artistry is there, people just can’t afford it.
That’s not really the problem…
The problem is that the returns aren’t good enough to support the risk. With AAA budgets, you need to hit ~top 5 of the year to make any money. That means broad appeal. Broad appeal and experimental do go well together.
I’ve said it before, and I’ll say it a million more times. Until games can be priced such that a mediocre AAA game can see a modestly successful profit, and one flop doesn’t tank a studio, this is the gaming landscape we’re stuck with. When people get their panties in a bunch about how profitable (aka greedy) the games industry is, they completely leave it the part where the overwhelming majority of that is tied up in the things that they hate. The AAA box product model just isn’t paying the bills. GotY does under that model, but the average is not great.
Also, people like to grab numbers without actually understanding the context. I see a lot of, “game X had a $500 million budget, and sold 15 million copies. That’s a 50% ROI, which is huge!” Ok, first of all, they do not take home the full box price, so it’s actually closer to 20% ROI. Second, that cool half-bil was locked into an investment over at least 5 years, making an average yearly ROI closer to the 5-10% range, which is worse than the market average. Finally, games is very boom or bust. There was a very real risk that they only sold a couple million copies, such would have been a massive loss.
So… How risky would you want someone to be if you loaned them 50k, and in 5 years they should be able to give you 60k, but also if things don’t work out you might only get 10k back. The math just doesn’t add up for risky AAA box product games. If 1-5 million copies was the break even point, you’d see a lot more innovation.
If the returns aren’t good enough it’s because we’ve created this landscape where graphics, features, and general technology are so complicated that the cost of making them is incredibly high.
The other issue is something your comment demonstrates perfectly. Games are now primarily business ventures first, art second.
20 years ago the aspirations for studios was to make great games for the arts sake and get paid decent enough to live well so they could keep doing it (this model still exists in the indie game landscape and does quite well). Now it’s all about ROI percentages and lining CEO pockets with ridiculous salaries and bonuses. Just like every other industry that’s become complete unbalanced with runaway capitalism.
The game industry has become completely warped by this paradigm. AAA Games now exist purely as a business venture. Giant companies have acquired almost all of the smaller studios so this mentality is all that is left.
“How can we innovate and make great art while getting paid” has turned into “Will this product return the investment to shareholders”. That is now the sole purpose in gaming studios today. It actually being a good game is just a secondary bonus that might mean better investment opportunities with it in the future.
Of course this is not just an issue with the video game industry. Obviously it’s part of the greater issue of the type of runaway greed that this system encourages. This has infected most industries now. Its part of why things are so out of balance between the worker and the c-suite execs.
TLDR: Giant mega companies who’s only purpose is to make insane amounts of money bought out all of the studios that used to have a balance of creating great art and getting paid enough to keep doing it.
I don’t think that’s entirely fair. You can begrudge the big budgets all you want, but the market had proven time and again that that’s what players want. If a studio doesn’t get the indie pass, players are all over them for being “lazy” and cutting corners. “You’re a big studio, with plenty of money. You can afford to do X, Y, and Z. Stop being so greedy.”
My point was that we’ve entered an age where player expectations are so divorced from reality that there’s just no winning anymore. Any studio that isn’t perceived as “indie” enough is expected to spend hundreds of millions of dollars developing the new blockbuster. Even then, when such a studio releases a massive hit expectations skyrocket. Developers have ambitions, and ambitions cost money.
No one is going to argue that greed isn’t driving some parts of the industry, but it’s not that simple. If you’re a billionaire and want to patronize a development studio to make a game for the artistry of it, think about what happens. You front the hundreds of millions of dollars. Best case scenario you’re not totally regretting doing that instead of sticking your money in an index fund. You make your money back, and can re-invest it in the next project. Worst case scenario you burn through the cash and don’t even have a finished game to show for it before you have to pull the plug length hundreds of employees in the lurch (this has happened). Average case you release a mediocre game for a niche audience and lose money.
Best case scenario you get to do it again. Most likely the you can afford to fund one big artistic vision and then the money is gone. A healthy business gets to keep making games. The games people want haven’t been disappearing because of some opportunity cost gobbling up all the game development resources. They’re disappearing because the profit is so low that one wrong move and the non “greedy” investor is out of money.
The industry will start producing more niche, artistic, and interesting games when it the average case is actually profitable. Until then they’re going to have to keep chasing the cash cows just to keep the lights on. The artistry is there, people just can’t afford it.