THE FINANCIAL FRONTIER

As digital distribution lowers the distance between game makers and their audience, a growing number of developers are tearing free of the shackles that link them to big publishers and finding new ways to fund and release their games…

By Joe Martin

 

Tim Schafer and Ron Gilbert have changed the way the entire industry looks at adventure games. Again.

It has become something of a habit for the pair, who since 1990 have been creating hilarious games in an industry typified by chest-beating soldiers and sorceresses in nipple armour. The Secret of Monkey Island, Grim Fandango – these are Schafer and Gilbert’s love letters to gamers sick of Call of Duty and Medal of Honor. This is the first time the pair decided to use their adventure games to challenge the business of making games, however.

It all started earlier this year, when the duo decided to extend their legacy as the masters of the point-and-click. Fans had been begging for a new adventure game for years and the pair, reunited under Schafer’s Double Fine Studios after time spent working apart, were finally ready to satisfy demand. The only problem was that nobody would give them any money; publishers and critics had held the adventure genre as dead for years now, so nobody would offer up the cash the team needed to get started.

Here, the project stayed stuck for twelve months – fallen at the first hurdle until Double Fine noticed the increasing ambition of crowd-funded projects. Kickstarter, a site where members of the public contribute money to new ventures in exchange for eventual rewards, started to seem like a viable option. Schafer and Gilbert wondered about an adventure game funded by the people who would play it, rather than the people who would sell it. Double Fine Adventure was born.

Unveiled publicly on February 8th, Double Fine Adventure was aiming to raise US$400,000 in one month – a small budget even for a small, old-school adventure game, and yet still one which Double Fine was sceptical it could achieve. As the Kickstarter went live, the staff of Double Fine stayed glued to their screens, as uncertain of what would happen as they were about what they should expect.

Eight hours later, Tim Schafer tweeted to his thousands of followers that the project had already raised the full amount. He said he was about to cry with happiness, but it was doubtful anyone was listening – everyone who might be interested was too busy pledging yet more money. It took Double Fine Studios less than 24 hours to raise $1 million. Within two weeks the company would double that and still have a fortnight to spare before the clock ran out.

“It’s been an amazing experience,” said Greg Rice, producer for Double Fine Adventure and the man who used to represent Double Fine Studios in its dealings with publishers. “I grew up playing Tim and Ron’s adventure games, just like our 70,000 backers. I’m so excited to be a part of this adventure.”

What shape that adventure might take, however, is still unknown. We spoke to Rice in the final days of the Kickstarter campaign and he admitted that, even a month into funding, the company still had no plans for what type of game it might be. It could be another pirate comedy or it could be a sci-fi murder mystery; nobody at Double Fine knew what was going on – and that was deliberate.

“We were waiting for the Kickstarter to finish, so we could get the cameras in and get all our backers on board,” said Rice, referring to Double Fine’s plans to publish a documentary on the project and allow fans to shape development via an exclusive forum. Filming would be conducted by 2 Player Productions who had been one of the inspirations for the project after previously using Kickstarter to finance a documentary about Minecraft.

Granted, a serialised documentary about the development of an old-school adventure game might not sound like everyone’s idea of fun, but Rice sees the documentary as playing a vital role in the development of the game. There’s a lot of pressure on Double Fine to both define what crowd-funding can bring to professional-level games development, and to live up to the promises laid by Schafer and Gilbert’s involvement. By having a film crew in every meeting Double Fine will become as transparent as possible, allowing fans to shape not just the game but also the method by which it develops.

Double Fine’s Kickstarter campaign isn’t an attempt to revolutionise game development, however. Instead, it’s part of the studio’s continuing pursuit of financial independence; a goal which has seen it self-publish its latest games on PC via Steam. The benefits to the studio are clear, with self-publishing letting the team set its own deadlines and manage its projects in a way consistent with their original vision. “It’s always better to be financially independent,” says Rice. “It lets you have full control over your games and their intellectual properties, [while] also meaning you don’t have to split revenues with an external publisher.”

Schafer has always been a figure of frustration in the games industry for this very reason; his idolisation by fans contrasting with his bad luck when dealing with publishers. Psychonauts, for example, is often blamed for the financial troubles experienced by publisher Majesco, while Brütal Legend swapped publishers three times and created a public disagreement with Activision boss Bobby Kotick in the process. Gamers have become desperate to see what Double Fine can achieve without publisher-imposed constraints.

Yet, it’s not only gamers who are watching Double Fine to see what its Kickstarter campaign can produce; the rest of the industry is paying close attention too. Developers such as Fallout: New Vegas creators Obsidian Entertainment have already embarked on their own Kickstarter projects, for example, as has Brian Fargo’s inXile. Not everyone is so eager to jump on the crowd-funding bandwagon, however. “Tim succeeded because he’s Tim,” warns Dear Esther designer Dan Pinchbeck – but it appears there are those who will take risks to break the cycle of publisher dependence.

Big companies such as Activision bring more to game development than just funds, of course. Even Rice is assured that there will always be a place for publishers when it comes to triple-A games – but for the smaller developers who are inherently more flexible and reactive than larger outfits, the publishing deals of old are starting to look less and less appealing in the wake of big-name independent successes. And Double Fine isn’t the only one looking for alternatives…

THE FUNDAMENTALS

“The problem with the business terms offered to even competent developers is that they are basically not viable,” says Jonathan Blow, the independent developer behind 2008’s Braid. “The terms are designed to keep developers subservient… keep them dependent on publishers.” Blow feels that breaking free of that control to become independent is almost totally dependent on luck. “It’s not in the long-term interest of anyone – publishers end up with starving developers who are rushing to finish work, meaning they have to offer worse products.”

Determined to find a solution to what he perceived as a serious problem affecting both creativity and success within the industry, Blow talked to other indie developers who’d found mainstream success. Before long he’d teamed up with studios such as 2D Boy (World of Goo) and Capy (Sword & Sworcery) to create an investment fund exclusively for small game developers. The aim, says Blow, is to help these companies reach independence by offering terms more fair than those laid down by large publishers – budgets are flexible and repayments both proportional and scalable. The developers get the cash they need, as well as guiding advice from Blow and co. without having to break themselves to hit unrealistic milestones.

As an angel investment group, Indie Fund is very careful in selecting who it works with though, partly because of the creative vision behind the fund and partly because it only invests in teams it believes won’t need to ask for more money in the future. Projects need to be unique and immediately compelling based on submitted prototypes – otherwise they’ll never recoup costs, let alone bestow financial independence.

“Finding projects to work on is very difficult,” admits Blow, who’s regular speech rhythm stumbles as he tries to define what he wants to see in games. Of more than 350 titles submitted to Indie Fund, only five have been given backing so far. “One of the most important criteria is what we call ‘Specialness’ – that is projects which do something different or which contribute to on-going debates about games.”

It was that Specialness criteria which led Indie Fund to invest in its latest release; Dear Esther, a remake of a 2008 Half-Life mod by Dan Pinchbeck and ex-DICE artist Rob Briscoe. Casting players as an unnamed man who explores an uninhabited island, unable to interact with the world other than through brooding monologues, Dear Esther was a project no conventional publisher was ever likely to touch. Where a conglomerate would have seen risk however, Blow saw a game he describes as “so creatively worthwhile [we] would have funded it even if it lost all the money.”

Again though, that didn’t happen. Dear Esther sold 16,000 copies and recouped all costs in less than six hours and has since gone on to sell over 50,000 as a full release on Steam. Dan Pinchbeck’s studio, TheChineseRoom, has since stayed true to the ideals of the Indie Fund too, starting work on new projects, rather than returning for more investment. “Working with Indie Fund was a no-brainer for us,” says Pinchbeck, who remains certain the large publishers would have shown him the door with alarming speed if he’d approached them. He goes on to praise every aspect of working with the Fund over the course of our conversation, especially the transparency with which the group offer guidance and practical advice to the teams it backs.

“If you’re under a normal publisher, it’s hard to have a similarly frank, equal dialogue with your account manager – he just has an entirely different agenda to you,” says Pinchbeck while Blow chuckles knowingly in agreement. That difference in motivation is something which the pair believe may eventually create problems for studios who attempt to follow Double Fine down the Kickstarter rabbit hole. After all, it’s easy to criticise massive, faceless companies for their approach, but gamers aren’t exactly without bias either. Enthusiast audiences often hold so much entitlement that they lash-out at developers as it is – that’s likely to only get worse when they’ve invested in the project and are told they can guide development. Or, to put it another way: what if gamers decide they want something different than what Double Fine is prepared to offer?

To this end, while Indie Fund still recommends upcoming developers explore all the opportunities available to them, Blow also warns there’s no such thing as free money. The extra workload piled onto projects by the creation and distribution of investor incentives (not to mention a serialised documentary!) can easily disrupt development or jeopardise the creative vision. All games, whether the work of a lone artist or a 300-man team, are prone to delays – and fans may be less likely to accept excuses than publishing professionals who understand the process. “You need to be careful with these radical models,” echoes Pinchbeck. “Sure, we’re seeing success stories right now, but there are also horror stories in the pipeline.”

The question more relevant to the Indie Fund isn’t how viable crowd-funding is however, but whether publishers will ever offer business terms good enough that developers don’t feel driven to such extremes. Can a happy medium be found for developer and publisher relations? Blow is uncertain, often sharing data with and trying to inspire change via his industry contacts, but saying he has no faith that such change will ever come about. To him, publishers are the oil tankers of the industry – too large to turn around easily and match the tides which surround them.

Can the successes of Double Fine Adventure and Dear Esther inspire the captains of the industry to change their course in time? Blow and Pinchbeck hope so, as these stories directly challenge the old notion that publishers are the surest route to success by offering the first legitimate alternatives. Previously, publisher-backed games could only really be compared to amateur-level productions or to projects which never got off the ground, but thanks to Indie Fund that’s no longer the case. We now have new terms which can be contrasted against publisher contracts – and which haven’t produced a failure yet. “What if the publisher model which we all previously thought was okay, actually isn’t?” asks Blow, his rhythm picking up excitedly as he presents a new line of reasoning. “What if it doesn’t work well at all and we just didn’t know because we had nothing to compare it to before?”

MY IDEA OF FUND

There are those who don’t see anything more unusual than a fluke occurrence in the success of these titles, however – and to whom Blow’s assessment of the publisher/developer relationship rings false. A good publisher can bring much more to the table – and more fairly – than developers give credit for, say these parties.

Part of the problem is that ‘publisher’ is by nature a vague and nebulous term. If a company agrees to publish a game, that may mean it is just distributing it, marketing it or throwing money at it – there’s no clear definition. The best publishers will do more than just any one thing though; they’ll supply whatever is missing while trying not to detract from the creative vision of the project.

So are developers subservient to publishers? It’s better to think that the two are subservient to each other, implies Paradox Interactive’s Shams Jorjani – the producer who oversees incoming game pitches for Paradox. “We try to be a partner in any project we work on. We assess new games on more than just sales projections, but on criteria such as if we’re a good fit for the idea and how far apart our vision for the game is from that of the developer.”

Faced with the hypothetical question of whether Paradox would back Double Fine Adventure even now, Jorjani says the company would still turn the project away for that very reason. There’s nothing which Double Fine needs which Paradox could realistically bring to the table, as it’s far more experienced with straight-faced strategies than witty adventures. Going it alone may pose risks for Double Fine, but Jorjani suggests it’s also the most sensible option for the studio.

There is more flexibility working with publishers than Blow’s warnings imply too, says Jorjani, pointing to the recently launched Paradox Incubator program as an example. Here, new developers can come inside the company for six months to generate prototypes, with Paradox providing equipment, tutoring and office-space as required. After six months Paradox re-evaluates the project and will either publish the full game in earnest, or free the developer to take the game elsewhere with some new references and work under their arms. From the outside, it seems like an ideal situation for new developers and, while Paradox is clearly hoping to get the drop on The Next Big Thing, the incubator also allows developers to test the water too. “We’re pretty transparent and so, yes, we want to recoup any investment, but we also try to be as fair as possible,” says Jorjani. “If the prototype isn’t a good fit after six months then there’s still a lot we can do to help these teams, whether guiding them to self-publish on Steam or forwarding them to another publisher.”

Jorjani and Blow do agree on one thing though; that bureaucracy is more of a threat to large publishers than Kickstarter will ever be. If the recent economic difficulties have proved anything it’s that the greater the distance between those who have money and those who need it, the harder it is for those people to work together. The largest publishers may have dozens of producers and consultants to throw at a project, but as the market continues to swell games’ need to stand out from the crowd more and more – ‘design by committee’ is a weakness, not a strength. “When I hear of a big publisher opening a new 2,000 man studio in Toronto, all I can think is how inflexible that sounds and how whatever trend that company is betting on had better pay off,” says Jorjani.

Following the reasoning through presents an interesting conundrum. Namely; if bureaucracy is the problem which plagues developer/publisher relationships, how will Double Fine Adventure fare in dealing with its 66,000+ investors, each of whom is promised a voice? Double Fine may have gained financial independence (and some free QA testers in the process), but it’s also dramatically increased the number of people who will be actively involved in making the game.

Success has only compounded this problem. The extra funds Double Fine has generated haven’t been squandered; they’ve been ploughed back into development. What began as a digital-only release for Mac and PC is now offering boxed copies to investors, full voice acting, multiple languages and iOS, Android and even Linux ports. This has not only drawn more backers to the project, but also pushed expectations higher. Bear in mind that while $2 million may sound a lot, in game budgeting terms it’s still very small.

Can Double Fine avoid succumbing to the type of groupthink which plagues publishers while still giving fans what they want? We’ll have to await 2 Player Productions’ documentary and the final product to tell, but with so many eyes on the company it’s likely that even if everything goes to hell then others may be inspired to find their own solutions.

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SIDEBAR 1: GOING SLIGHTLY MAD

Kickstarter isn’t the only route for companies looking to involve their fans in the design and funding of games. Need for Speed: SHIFT developer Slightly Mad Studios has launched a similar project of its own, dubbed Project: Cars.
Using a platform Slightly Mad calls WMD (World of Mass Development), players subscribe to the game even before the initial Alpha version is finished, slotting into tiers which dictate their involvement with the project. At the lowest echelons players can read minutes from developer meetings and play monthly builds of the game, while more senior investors can actually attend meetings, appear in the finished game and reap a cut of the revenue when the product goes on sale.
While Slightly Mad Producer Suzy Wallace says the freedom from conventional publishers is certainly a “refreshing change”, the biggest benefit to the developer is the QA resource now at its disposal. “Games are normally played by focus groups before release, but at that point the feedback is often given too late to make major design changes – you can only make tweaks,” says Wallace. “Our development method means we have a huge focus group playing the game daily, right from the beginning. We get feedback on all our decisions, but early enough to do something with it.”
Getting used to so many dissenting voices hasn’t been easy for Slightly Mad, however, and a number of moderators had to be drafted in to manage the community. Some fans have given unrealistic proposals or misunderstood the development structure too, creating very public problems.
At the same time though, some investors have proved invaluable to the game. Wallace points to one group who investigated an abandoned race track, taking video footage and interviewing experts so that Slightly Mad was able to create the location in-game. Car blueprints and reference material is often submitted to the team too, proving that internet communities can make worthwhile contributions after all.
“There’s been a shift in games development,” surmises Wallace. “We’ve gone from big, console-based teams to smaller studios and more social platforms that fit better with new funding methods. It’s not going to kill the big publishers – and there will be some duds – but we’re all for opening the floodgates.”

— — —

SIDEBAR 2: FRANCHISE INXILE

As Tim Schafer and Ron Gilbert are to adventure games, Brian Fargo is to RPGs. Thanks to the likes of Fallout, Baldur’s Gate and Icewind Dale, the founder of Interplay may now run a new studio – inXile Entertainment – but his past still casts a long shadow. Now, inspired by Double Fine’s example, he wants to cast it further by using Kickstarter to resurrect one of his oldest series – Wasteland, the top-down precursor to Fallout.
“I’ve been trying to do a Wasteland sequel for twenty years, but there were legal issues,” says Fargo, who says the Fallout series was created in part as a reaction to that very problem. “EA was nice enough to work out a deal with me about ten years ago and I started to shop it around in earnest shortly after that, [but] we just got nowhere.”
While it’s easy to see publishers buying in to the misconception that the adventure game is dead, it’s much more baffling to hear of Fargo’s pitch being rejected. RPGs haven’t just gone from strength to strength, but the titles which Fargo helped launch continue to be recognised for their commercial and critical successes. Saying ‘No’ to a Brian Fargo RPG is like saying ‘No’ to a Michael Bay action film.
“The problem was most people at the publishers we spoke to had never even played an RPG,” says Fargo, who explains how difficult it then became to communicate the opportunity he was presenting. “We would get generic responses, or we’d be told the company already had an RPG in its line-up and that that covered the entire category for them.”
To Fargo, Kickstarter represents a chance to break out of that sort of formulaic thinking and return to the creative vision he’s been carrying for the past two decades. The Wasteland sequel will defy modern expectations and be a top-down, open-world RPG that doesn’t hold your hand or present a black/white morality, he promises. Rather than getting entrenched in design by committee, Fargo will tap into fans directly by involving them just as Schafer and Gilbert are.
Fargo may still only be painting his designs for Wasteland 2 in the broad strokes, but those strokes still spell a clear message – that publishers may soon regret not supporting developers properly.
“If you had any idea how some publishers treat developers, you’d be shocked,” says Fargo, promising he can tell tales of disrespect from his own bitter experience. “The indie movement has started a power shift that I hope continues.”

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