On Gaming's Future: Can indie publishing work?

I’ve always had a ton of respect for indie games and while I tend to buy a lot of them, I’ve always faulted myself for not playing nearly as many as I should. Even with creativity and innovation in the triple-A space as an all-time low, that’s always where I’ve tended to gravitate with my gaming time. That changed unexpectedly during the two weeks I had off from work at Christmas time. I played a boatload of Skyrim to be sure but most of my time was spent playing indie titles on my PC, some of which I had owned for a while and some of which I got during Steam’s annual bananas holiday sale. I spent a bunch of time with Rochard, Dungeon Defenders, Space Pirates And Zombies, Tribes Ascend (OK, not really an indie game in the strictest sense as it has money behind it but it is a totally independent developer) and dabbled in a bunch of other titles as well. For the most part I had an awesome time, especially when you consider I could have bought all the games listed above for less than the cost of a single triple-A title at release. There was real quality in these games and a creative vibe you don’t see elsewhere. I was pleasantly surprised as it wasn’t my intention to focus on those games during my time off. Each took a genre in a totally different and creative direction and they were a real palette cleanser.

The biggest problem most indie games face is that while there is a dedicated and devoted community that follows them, it is a very small subset of gamers as a whole and certainly nowhere near mainsteam. Most indie developers will work and sacrifice for years to make a title and few of them realise any significant profit from it. Generally making enough to fund development of the next title is considered a major victory to an indie developer. It’s criminal that these amazing, innovative, affordable titles don’t get more mainstream exposure but often, the only real way to do that is with a publisher. Of course, avoiding publishers and the “big business” way of thinking is what indie developers are all about, with good reason. Still, this leaves them between a rock and a hard place. Do they put the game out themselves and reap all the potential reward or do they partner with a publisher who may get more sales but keep a lot more of the proceeds and in the end, maybe even own the work?

A recent episode of the Jimquisition that was focused around a largely ridiculous view of piracy brought up one of the major problems with traditional publishing that I hadn’t considered. Publishers generally consider their most valuable assets the intellectual properties they own. The bigger the stable of IP they own, the greater value they are perceived to have. The problem is IP only has real value when it’s generating value. Jim Sterling told a story about a game called Metal Arms: Glitch In the System which came out on the last generation of consoles and which is one of his favourites. It was published at the time by Sierra, a division of Vivendi Universal Games who is now part of Activision. Metal Arms was developed by someone else but as is often the case with publishing deals, Sierra got the IP. The game shipped and was a critical darling but nobody bought it so Sierra put it on the shelf. The developer thought it was worth taking another crack at it so they asked to make another game in the series with Sierra and when Sierra wasn’t interested, they even tried to buy the IP back from them so they could do it themselves. Sierra refused, nothing was ever done with the Metal Arms IP and its value has continued to rot away. Now it’s virtually unknown outside of the few who bought and enjoyed the original game. Activision still owns it but it’s depreciated to the point of being virtually worthless.

It’s hard to argue that Metal Arms makes Activision any more valuable as a company at this point, yet the common belief among publishers is that simply having more IP makes you inherently more valuable. I think this is a dumb way of thinking because owning something that virtually no potential customers would know anything about isn’t worth anything. Yet ownership of IP is the main sticking point with developers big and small who want to work with publishers to release their games. Simply having a brand and driving continued sales of it isn’t enough, the publisher always wants to own it, even if it ultimately stagnates on a shelf. One of the reasons the indie game scene was founded was because of developers wanting to own what they make and not having to hand it over to a company who ultimately cares about shareholders over art. There are exceptions of course and developers who are large enough or able to self-fund their projects often do retain control of their IP and their creative destiny. This is very much the exception these days however and will only get more so as budgets continue to increase.

All of this got me wondering if there isn’t a potential business model in a happy middle ground, something I call “independent publishing”. The idea would be to pick the most valuable aspects of having a dedicated publisher but acting in a strictly supportive role to independent developers. An independent publisher would provide the public relations, development assistance, platform support (i.e. release slots and coordination for places like Xbox Live and PSN), drive consumer awareness and possibly even offer some small funding advances to worthy indie teams. The publisher would take a decent but not obnoxiously large slice of the proceeds depending on how much support they provide but the developer would always own the IP of the products they bring in. The value of the publishing company would not be created from owning a bunch of IP but in fostering long-term relationships with creative indie teams, releasing a steady stream of new games and profiting from the revenue share.

This would put the indie teams at ease because while they get access to the tools and resources needed to get their games into the mainstream consciousness, they know they aren’t creating something which will ultimately be handed over to someone else, leaving them with nothing to show at the end but their meagre royalties. It will also keep the publisher honest and force them to provide top notch service to their developers because their value and ultimate worth is going to come purely from sales, not ownership of the final product and associated brand. Publishers today always refer to the developers they work with as partners but in reality, it’s a domineering relationship. An “independent publishing” model would truly be a partnership. One side needs the other equally and in the end, they work together, grow together and prosper together. There are some attempts at trying this model with groups like the Indie Fund and the Extra Credits initiative but these are designed more around giving funding advanced to indie developers to finish projects. That’s awesome and very useful but what I’m proposing is a whole new subset of the industry that would provide a full suite of publishing and marketing services, not just bursaries. It would offer all the good things about a publisher with none of the current bad things.

I’ll be the first person to say I don’t know nearly enough about the games business to know if this could work or to take a shot at it myself. If I won the lottery tomorrow and had a lot of money to burn, maybe I would. Nonetheles, I think there may be potential for real success with this kind of model if smart people ran with it. The current paradigm of large, publicly traded video game publishers may not be supported by this but as I’ll discuss in a future post, that business structure isn’t really working anymore either and may not be sustainable. New ways need to be found to continue to advance this medium creatively while still having it make money. True innovation is coming from indie developers and if companies can come along to provide them the means to reach a large audience while not insisting on owning their souls in the process, I think it could meant great things for gaming as a whole. I wonder if anyone with the money and business chops thinks similarly. If so, I’d love to talk to them.

This entry was posted in Business, Predictions, Video Games and tagged , , , , . Bookmark the permalink.

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.