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An Argument for Community Funded Games
by Seth Sivak on 07/21/09 11:38:00 am   Expert Blogs   Featured Blogs

The following blog post, unless otherwise noted, was written by a member of Gamasutra’s community.
The thoughts and opinions expressed are those of the writer and not Gamasutra or its parent company.

 

Destructiod and Kotaku both have coverage of a Gabe Newell interview discussing an idea of using the game community to help fund projects directly. It is a really interesting idea, and I think it actually makes a lot of sense. This should basically be seen as pre-pre-pre-pre-ordering a game.

I think this can work if done correctly.  Consider how many gamers already purchase special/collector/prestige/limited/legendary edition of games (it has become pretty silly).  People are willing to pay extra money if they are serious fans of the game or franchise.  I think this could be harnessed early on with well-known indie developers to help fund a game when it is still in a larval stage.  Many people pay to have their names on a brick at their alma mater, I think game developers can offer perks that are similar to this.

Imagine paying 100 bucks to have a 100 x 100 pixel image of you appear in one of the hidden back rooms in the next Portal game.  I would love to be able to pay $200 to get exclusive content from Bungie on their upcoming game, and maybe even have the game ship with a fake Ling-ling.  What about getting early access to the next game from 2D Boy, or even being allowed to try a beta or chat with the developers during production?  I would pay for that.  I trust that they are going to make an awesome next game.  And the bottom line is I would do this before I even heard anything about the next game, or before production had even started.

However, there are a few things I would consider before diving right into this.

  1. This should only be considered by indie developers.  I think this is pretty obvious, since if you are not an indie studio you are getting funding from a publisher. However, I also think this is important for how indie studios typically engage with their fans.  Since the funding is coming from the fans, the studio-fan relationship is incredibly important.
  2. Don't try this on your first game.  Fans need to trust the developers themselves almost more than they need to trust the idea of the game.  Once this is ruined for a group of fans I doubt it will ever work again and it might actually ruin it for all indie developers.
  3. Consider the legal issues. I am not a lawyer, and if you are going to try having that many people "fund" the game makes sure you are doing it right.  If the current debacle with Tim Langdell has taught us anything it is that indie developers need to protect themselves. 
  4. Give fans something they want. I think this is a place where we can take a clue from the music industry.  The recent shift in that industry have forced many musicians to strike out on their own working to create a fan base that will support them.  Paying for the tracks themselves in no longer viable, but paying for live shows and awesome swag (like a collectors edition) is how these people survive.
  5. Make awesome games.  This one seems somewhat topical, but it is important.  This funding model is asking fans to put themselves into the game.  They are part of the game in a way that has never been offered.  If this fails, it will be a huge fallout for the community.

I think a well established indie developer (like 2dboy or Valve) that has a strong group of fans dedicated to the studio, not just a single game, could pull this off. It is important for the fans to have faith in the studio, because that is really what the gamble is on. Then this studio could produce a short demo or give a simple idea and see if fans would like to see it turned into a full game (and if the fans think the studio can even pull it off).  I would love to see this model adopted or tested, I know many game fans would probably be willing to make the gamble.

And if the two Kyles are listening, I have $100 I would happily invest in your upcoming project.


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Comments


Duong Nguyen
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Community developed games arn't new, but the advances in mirco-transactions and the internet have made them viable at least. Alot of games for the iPhone are community developed as well in a sense, they release multiple iterations of a near complete product and the community votes with their dollars and continued support on what new features they want to see.



There is the well known example of Cortex Command which is community funded in the sense that people bought an incomplete product to help it continue development and guide its features. However all examples so far have been small indie projects with strong vision (single creator or small teams). I don't think this model will scale up to the studio method of game creation personally. The overhead of a studio is much larger than a small indie team and cash burn through rate is much higher.



I don't think a community funded game could sustain the needed cash requirements for a full development cycle of a studio size game company, however a version of that model similar to how stocks work, ie. public offerings of shares in the game might work. You'll have a mix of large and small investors, once you secure enough funding for a full cycle you can start development, profit is shared among the studio and the investors, but control is always left to the company, might work..



-ddn

David Reeves
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I too think this is a much better model for game development than switching to micro payment style system that only lines the pockets of the big boys more. ie. same crappy games nobody wants.



That aside, if you took this proposed idea and cross combined it with a few current models, then you'd not only be paving the way for a more deverse member base but also encourage the expansion of the industry overall.



Let's take a quick stab at some thoughts: Firstly a good example of an idea we'll start with Society (http://societygame.net) and their interview here http://www.gamasutra.com/php-bin/news_index.php?story=22173 about possible plans.



Now why couldn't we wishfull players invest in the development of Society Game?



Another course of action for this model would be something in the vein of DominanceWar or Unearthly Challenge style competitions. If you had a community network under the guise of say steam, why couldn't these competitions be working in gear to what the community out their wants in a game. We could have a vote on the style of game to be made and work towards a plausable game. Once we reach the closing type of game wished by the community, the competition rounds would begin and the competitors would have the same art/deisgn/music/etc. direction for their entries.



The public would then select which style they like, judges would award their votes and pick the winner. The first prize would go to the winner with that being an internship at the said studio and getting the winner on their path to a career.



Now I'm not finished just yet. If you are making an online game, then you'd do the same worldwide with a section of the world being made by a regional group. ie America, Europe, Asia, and Oceania. Each would be challenged to create a regional area of the world with a unique style of the competitors.



Funding would then start after the completion of the competition, you would be given a chance to opt in for your region and put your money were your mouth is.



In the end we'd get a new game online (in this example) with regions pertaining to each's wishes, the challenge of the competitors would be the same as if they were at a studio under direction of the Lead. As a wishful player you can participate at each stage until it stems away from your type of game. Yet if it's what you'd like to see made, then you could preorder at this point.



Now if you were to put your money down at a mid point, let's say US$10, this would be turned into an online currency. So if you pull out of your desire for the game at the 3/4 mark, you'd be able to put that money into another project and continue again with your voting until you end up with your desired game.



What we'd get is investment of game development, gamer feedback and focus of desired games, and the chance to be either a player or contender.



Now that all said, what if an AAA publisher wishes to develop one of these ideas, well they could purchase the whole concept product, money goes to community as a whole for more competitions, and the publisher could then develop the game and taking on the winners as interns themselves. The lucky B's would be a little wrapped at this point ;)



This whole idea is probably got more holes than a sieve, but with work it could really be a boon for the industry imho, in more ways than one!

Luis Guimaraes
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Interesting...

Seth Sivak
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ddn - I think the big difference here is the point in the project that the funding comes in. I totally agree with you that getting $20+ million is probably not really feasible, but I think that this form of funding works best for mostly small indie studios. At the Indie Games Summit this year 2D Boy listed the overall budget for World of Goo and it was a couple 100 grand at most. I think that number is achievable.



The Cortex Command example is great to show alternate forms of funding. Now if they had shown a super early demo of the game and asked for people to fund it that would be more in line with what I am talking about. Instead they basically released a playable beta and said they needed some more money to finish it (i think, i am not 100% sure of their process).



I am a bit weary about actually making gamers investors to the point that they can expect a payout. I think a much safer path is to offer up special editions of the game, other swag or perks that relate to the game or studio. However, I am totally ok with being proven wrong. I have some extra money I would likely invest.



David - I think the competition idea is interesting. This is in the true nature of crowdsourcing the concept and hoping that the best one will win. I think having a pool of indie games and a compeition to see which ones should get funding is fascinating. The Indie Game Challenge (http://www.indiegames.com/blog/2009/07/indie_game_challenge.html) is doing something like this where the winners get to go in front of a group of publishers and pitch their ideas.



I wonder if a studio like Valve could hold a competition like this. People are allowed to give a demo or pitch to the community, and the winner will get made with some help from Valve. Funding will come from the community itself, and this could happen at a pretty frequent rotation so that if you pull out of one project you can put it into the one that might start 6 months from now. These games would likely need to be small, but it would give gamers a big role in the games they choose to fund. I like this idea a lot.



The bottom line is that indies have a chance to do something different. I think fans relate to small indie studios in the same way that music fans relate to bands. I think this could be harnessed, and that is why I linked to Trent Reznor's post. He makes some great points that are somewhat applicable to the game industry. I am excited to see what indie studios start to do, now that Steam is so solid and that Mastertronic has created a retail indie label (http://www.gamasutra.com/php-bin/news_index.php?story=24157) there is no reason to get a publisher.

Adam Sims
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There are a number of overlooked core issues with this model that no one seems to be addressing.

As it stands, I do not see the existing concept of "community funded" development working as expected.

Seth Sivak
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Adam - What are the core issues?

Adam Sims
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If I get time to write a report on it, I will blog a summary.

David Reeves
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Cheers Seth, I think areas like the Indie Game Challenge and other modding areas have been long forgotten, maybe this is one way for us the ommunity to get back into the game arena. Aside from the usual games like Unreal, etc. when was there anything more than Buy Game, Play Game, move onto the next big thing?



It's funny that you mention Valve too as I believe Gabe is getting the idea out there to see if it has legs, god only knows what has already been done inshop with this model inmind. Either way bringing games back to the people is one thing, we don't want to see this pulling away from AAA titles on one end, but we also need to keep the community moving towards being an asset too.



Thanks Adam, look forward to seeing the other sides' point of view. I await your blog.



I almost forgot about Gamesbeat Hippie. I think that model is like the industry in Australia. The only downside of these bank-backed bond models is the it's only shifting from one mogel to another.



Put another way, at least publisher's are in the industry. It'd be like asking Linux people to develop Windows, Microsoft to market everything, and Mac to design the platform. Might look or feel right, but too much outside influences with their own agenda getting in the way of the end product.



One thing I will say (for the moment) is this topic has opened a can of worms acorss the net, people are at least talking possible avenues rather than the industry has died with the economies. And talk is always good as long as it turns into something being done.

Seth Sivak
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David - I agree with you that there is hopefully a new way for the community to get involved. I am not saying that the possible examples I gave are the only ones, or that these examples are even viable. I am happy that this discussion is taking place. Personally, I am fully on board with the idea of harnessing the fans and community to fund a game before it is even made. i think that is not too far of a stretch from what is already being done with pre-orders. And I do not think this will really shake the current publisher-developer foundation, especially for AAA titles. I see this really only working on a small scale at the current time.



Adam - I am also looking forward to this. I think there is a lot that the industry is learning from the discussion. The biggest barrier for most game developers that want to make the leap to indie is the funding, the more avenues we discover, the better off we are.

Seth Sivak
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Hippie Chiq - Those are all great examples. I think this model has potential, but will need some work to iron out. The stronger the mod community and indie community becomes, the more potential this type of model could have.

JB Vorderkunz
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If the ROI is a copy of the game, that's a decent chunk of the potential profit right there - although, the better the game, the less of a chunk the ROI copies will represent as word of mouth and buzz sell more copies. If ROI is a percentage of profits, and the investor spends part of the ROI to buy a copy, then the dev/pub gets the money right back. If the ROI is a copy & % of profit, then the net profit for the dev/pub has shrunk significantly. The dev/pub could offer exclusive merch like DLC, in-game presence, etc. and still maximize profit from actual game sales. So on the face of it, returning cash or merch rather than a copy of the game might make it more feasible...

although i'm not trained business person - so this could be utter nonsense :-)

David Reeves
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J. BV - I can see what you mean but the Return On Investment comes back to profit once the Breakeven point is crossed.



Let's say the game cost $2 million to make and there's 1 million investors, each putting in $10. 1x10-2=8 million left. So after completion who gets the $8m, do they have a model to payout the investor or offer shares style payback. ie. instead of $8 per person, I could opt for my "shares" to go into the community loop and choose which game I wish to invest that money into for another round instead of pocketing the profit. It could even be rolled over to enhance the game further.



This is where I see the benefit of a community system, the moeny is invested and many benefit including the people making the game, they get to eat, others get a chance to join in, and we the people get to see the game we want.



Even if you mean that the game company gets to keep a percentage of the leftover profit, that could be part of the deal vefore we invest. A company could say, we'd like to keep 40% for bugfixing and so on, ie. their profit margin.



You do however bring up another revenue stream, merchandise. Taking your idea a little further, how about once a game reaches their breakeven point, each invester gets a DLC choice, a T-Shirt, and so on. The shop goes online to open the way for more direct purchasing and increasing the game's profitablity. Not only does this open the door on more development investment, it also adds a better return on investment or as you put it ROI.



btw, it doesn't take a trained business person to have a good point of view or add to the conversation. So thanks for giving me another chance to expand this even further.



Seth ~ The more people talking about this topic will allow the model to evolve into more possible examples. I do however see that like Open Source, it adds to the quality coming from those AAA devs. Games like World of Goo is what is needed, this could just pave the way for more.



I am at least 4 years away from even looking at joining the industry, so for me it's opening doors so we get to see more on the other side. Bring it on, the better prepared I am the better. Just dying to see Adams' spin on things, be wary of only looking at the good points ;)

Dan VanBogelen
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Well this hearkens back to the day of Battlecruiser. Developer, jack of all trades, Derek Smart got a bunch of people to "pre order" his game, only to put out one of the worst releases in history. Yea consumers also need to have the proper information if there going to be investing.



Past history isn't indicative to future returns.

I think some legal study would need to be in place to cover all the tracks. Your not issuing stock so you may not be under any protection that comes with loosing capital in a stock market. Communication with the investors/players had better be much better then what I see currently on game forums. Your going to setup a system where the investor/player need to come first when information needs to get disseminated, spending all the time marketing your product should come after the group got to see the information. it's a way to give the investor/player a feeling that he belongs in a exclusive group.

JB Vorderkunz
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@David

Glad to have made a positive contribution (wasn't sure i had).



@Dan

You bring up an interesting point - communication with the investors. A thought: what happens when the investor forums are up, people have formed factions and a sizable faction, deciding it has been ignored by the devs, takes legal action? One would hope this wouldn't happen, but it does within the stockholder communities of both public and private companies.

John Bixler
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Just stumbled on this post today... Good ideas! Ironically enough I just started a blog on the very same subject (I knew someone else must have thought of it first!), with a specific focus on the Sim City community (a lot of people were disappointed by Cities XL, and EA doesn't appear to have any plans for Sim City 5). You can read the "manifesto" (so to speak) here, if you're interested:



http://blogs.simtropolis.com/nextgen/index.cfm/2009/10/11/The-Ope
n-Source-Future--How-we-can-finally-get-the-game-we-want



The twist in my idea is to develop the game on an open source basis under the aegis of a non-profit group, where the ROI is 1) that the game gets made in the first place :) and 2) that investors will have a voice in the development since they will also be owners.



I'm actually inclined to think that assembling a pretty substantial budget *is* possible if the circumstances are right (and I think the circumstances in that genre *are* right ATM.)

John McMahon
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So 3 years later (almost), what's everyone's take on the Kickstarter projects?


none
 
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