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Independent AAA: Ninja Theory's new path to survive, thrive in new age
Independent AAA: Ninja Theory's new path to survive, thrive in new age
August 12, 2014 | By Leigh Alexander

Ninja Theory's games, known for stylishly combining graceful art and melee combat, are well-liked, and the studio's considerable talent enjoys respect. But behind the scenes, the studio has struggled since birth -- often within an inch of its life -- against the unique challenges and constraints of the AAA industry machine.

At GDC Europe, co-founder and chief creative officer Tameem Antoniades blew the doors open on the company's significant battle to thrive, and revealed a commitment to furthering a new "independent AAA" model, with a new project combining a smaller budget and more specialized scope with AAA production values, direct to players. Part of that includes openness, Antoniades says, knowledge-sharing with other developers, and releasing some details of a fascinating past project that never came to light.

Ninja Theory's upcoming work will be announced this week at Gamescom, but the often painful course of the studio's life makes a fascinating story, a clear illustration of the obstacles presented by traditional AAA game development -- constraints that have only gotten more severe over time.

[Editor's Note: Ninja Theory did indeed share a few details about its new 'independent AAA' project Hellblade during Sony's Gamescom press conference.]

"Fear, change and excitement is part of the natural lifecycle of gaming," Ninja Theory co-founder Tameem Antoniades says. The industry has been undergoing its least linear transition yet, as the traditional retail model splinters across any number of digital platforms and digital distribution gives rise to new independent models. Some of these business changes have made the gap between high production-value triple AAA games and the ones we know as "indie" wider than ever.

"I was amazed an organization could invest so much in a game and its development and then seemingly send it out to die, but the marketing budget had to back the games with the biggest returns."
"Being in the games industry for 20 years means that I am the establishment, whether I like that or not," he says. But he believes there's massive opportunity in the gulf between indie and AAA, and that veteran studios like Ninja Theory may finally have access to the creative outlets they've longed for.

In the beginning: Just Add Monsters

Antoniades was employed as a programmer and designer when he and some colleagues set up Just Add Monsters in March 2000, with 300,000 in savings, a small office and a passion for kung fu. But as no one was interested in publishing their game Kung Fu Chaos, the team allowed themselves to be bought by Argonaut, and signed their game to Microsoft, who was looking for a way to make a mark in the console space on the Xbox.

"We're still proud of the game we made," Antoniades said. "But it tanked; there were no ads, no support on the shelves. I was amazed an organization could invest so much in a game and its development and then seemingly send it out to die, but the marketing budget had to back the games with the biggest returns."

Players didn't take to Kung Fu Chaos' cartoony look; consumer appetites for realism were ramping up in 2003, and the studio's relationship with Microsoft did not continue after launch, much to its surprise. Only profit and loss mattered, and Microsoft owned the IP, leaving the studio to start from scratch. "To this day, if we were able to work on a sequel, we would," Antoniades says.

The arms race marched on during the early millennium, as stylized games fell increasingly out of fashion. Publishers felt "gritty realism" was less risky and was of more benefit to tech. Budgets and featuresets ballooned, a pattern that continues today: "AAA is starting to look a bit like Tesco superstores -- big, homogeneous, expensive and not necessarily better quality than diverse local markets," Antoniades says. "This has sidelined entire models of gaming, a lot of creative teams have been sunk by this, and often it's because they can't compete with blockbusters."

"While people in these studios often move on to form new ones, talented teams are broken up forever and years of knowledge are thrown out," he says. "We survived by focusing on quality, shipping on time and on budget, but so have many. It really comes down to this: We've been lucky."

Saved by Sony, but at a cost

Just Add Monsters' parent company entered administration in 2004, right as the studio was prototyping the game that would become Heavenly Sword. The team pulled together to buy back the company and its assets, left with just about three months' financial runway. But they had a major challenge: Without high-end experience, publishers mistrusted the team's experience and feared their small independent team would not be competitive.

The company ended up selling its IP and its tech to Sony, becoming the PlayStation 3-exclusive pioneer Ninja Theory in the process. "Sony saved our skin," Antoniades says. "But we no longer owned our creative output, and lost our independence as a studio."

"We felt the only correct choice was to walk away from the IP and the tech, and seek a deal that would allow us to stay together as a team."
Heavenly Sword's 2007 release helped launch the PS3 and lead the advent of performance capture technology in video games. But its sales were only modest and reviews were average: "In retrospect, I think we took on too much, but as a first effort on PS3, we did okay," says Antoniades. "With this grounding, we were planning on knocking it out of the park for the sequel.

But since the team came into the initial deal weak and desperate, there'd be consequences: Tied by exclusivity and with no ownership over their own tech and IP, they were at a disadvantage. Their 80-developer team did not fit into Sony's cost model for the project, and no one was free to undertake projects other than Heavenly Sword 2. Ninja Theory faced a very difficult decision.

"We knew that the value of a creative company comes from teamwork, experience and talent of the people in it -- keeping the team together was much more important and valuable. We felt the only correct choice was to walk away from the IP and the tech, and seek a deal that would allow us to stay together as a team," Antoniades continues. "It was a truly heartbreaking end to an amazing journey, but I'm grateful we had the opportunity to make Heavenly Sword. Again, to this day, if we could work on a sequel, we would."

Pushing back against mounting challenges

As Ninja Theory could not use its own engine, it licensed the Unreal Engine and had created a design document and trailer for the game that would become Enslaved. In a financially-critical position, the first company it signed with collapsed just after signing, and signed with Namco in the nick of time. With far less budget than Heavenly Sword and in half the time, the game had exponentially more content and received higher Metacritic scores. It launched to middling sales and little fanfare, though, for factors unknown -- potentially the fantasy environment was off-putting to wider audiences, or perhaps it had too little advertising and exposure.

Once again, there could be no sequel even though the team wished it. "When you don't own the IP, you don't get a say in the matter."

Ninja Theory next did DmC for Capcom -- it was well-received and in many was was the culmination of the studio's stylish aesthetic. It was also the first game the studio had ever generated royalties on. But by then, the AAA market had hit the wall and could expect few runaway successes.

"IP ownership remains a dream," he says. "Royalties are virtually impossible to achieve... by the time DmC launched, retail sales were slipping for all but the biggest hitters like GTA. No publishers were signing games, instead focusing on the studios they already had."

So in a constrained retail market where many publishers are exiting consoles altogether and melee games aren't thought to sell, Ninja Theory recently began experimenting with in-engine art using Unreal Engine and creating numerous concept projects. It released game called Fightback around Christmas 2013 to prove to itself it could do "small", and to teach itself smartphone and tablets.

Fightback has seen over 3 million downloads worldwide -- "it really showed we could put our hands into different business models, and also showed us just how tough and competitive the app landscape is. It's very, very difficult business."

The creative concepts that will never be

Ninja Theory also approached smaller publishers with a story-driven horror game, but found themselves facing down suits who expected the team to add melee combat as that was what they were known for -- and were then told that melee games don't sell. They were told not to focus on story games because 'only space marines, superheroes or soldiers sell'. "We let those projects slide."

"In the end, it didn't survive the publishing greenlight process because Destiny had just been announced at that point, and no publisher wanted to go up against that."
"Every concept we came up with came back with some kind of sales sheets showing similar games did not reach 3-5 million units, and, frankly, some ludicrous suggestions," Antoniades says. Black Swan and Clash of the Titans made the same amount of money in 2010, but the games publisher will bet on Clash of the Titans every time, even when the fallacy is pointed out to them.

Finally, Ninja Theory tried to develop a game that fit into a publisher's next-gen checklist while applying a "wrapper" of their own style and soul. With Razer: Born to Fight, the team made an artful, next-gen collaborative multiplayer space combat experience backed by a mobile and online social network, a concept that they felt allowed them to please publishers and express themselves at the same time.

"It was our attempt to go big enough to be viable," Antoniades says. "In the end, it didn't survive the publishing greenlight process because Destiny had just been announced at that point, and no publisher wanted to go up against that. As games get more realistic and more spreadsheet-driven, they start to clash."

But Antoniades says the company will share the concept and design publicly next week, hoping to offer other developers a peek behind the curtain and -- and that the team's hard work sees the light of day in some way.

"After Razer, it was apparent creating a new IP was problematic. But we did eventually land a different project based on a different IP, and we set about changing Razer to suit it. The publisher asked for drastic redesigns and we did our best to accommodate these, but over time we effectively lost control over its direction. The project was amicably terminated."

'Independent AAA': The path ahead

"In the past we would pitch an idea we were passionate about, find a partner that believed in it enough to fund it, and execute it to a high standard on time and on budget. But here we were, hitting a dead end. I don't believe publishers are making these calls out of spite -- they are responding reasonably to AAA market conditions using the evidence they have to hand," he says.

"It's what I call the 'independent AAA' proposition.... the path by which developers can make leading-edge games for specialist audiences and maintain stewardship."
These kinds of publishers and investor organizations have incredible creative challenges, as their leadership methodologies and corporate culture favor consensus over creativity and risk. Sales-driven analysts are protected by group-think and market data, while the risk-taker or the creative person is the first one out the door if something goes wrong.

"Design by spreadsheet" has become most companies' default position. AAA itself stands in the way of developers wanting to make creative games and players hungry to play them. Entire genres have become uncommercial -- stealth games, RPGs and story-driven games have all been influenced by a similar kind of combat experience.

"I believe there's another path," Antoniades says. "It's what I call the 'independent AAA' proposition.... the path by which developers can make leading-edge games for specialist audiences and maintain stewardship. I took a small team of ten people aside, and we've been working up a concept for a couple months now."

"The game will be announced during Gamescom, and it will be an independent AAA game. This model puts the developer at the center, and in direct relationship with the player. The game looks and feels AAA, but is smaller and more focused, with a total budget that's a fracton of our previous games," he continues.

Ninja Theory will provide most of the budget itself, and is "pursuing several strategies" for the rest. Kickstarter will not be one of these, he says. "If we and others can prove that the independent AAA model is viable and profitable, it might open the door to more funding models, such as those that have been around forever in independent film-making."

And in independent models, where publishers are free to withhold or reveal information and technology at their own discretion, developers have more opportunities to build a knowledge base and generally support one another in an open manner, Antoniades believes.

"There is a middle ground that can be filled by forward thinking publishers who don't drive away developers with onerous levels of control," he says. "We're working on several projects at the moment, and found some publishers to work with us. They're all very unique. There are still opportunities out there, especially now that confidence is returning to the console space. The publishers we chose were the ones who were willing to go against the grain."

"We're going to lift the veil on development, invite you into our process and share resources along the way."

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John Paduch
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This sounds like 100% spin and hype, to me. So, you're going to have "AAA production values", but make the game smaller? And how are you going to fund it, exactly? And how is that attempt at funding going to be any different from the situation you've spent the last 14 years becoming jaded in?

I get the desire to try to find new ways of engaging consumers directly, without the "establishment" publishers mucking things up, but I see nothing in this article that indicates he has any idea HOW he's going to do things differently. All we get is "pursuing several strategies" for the question of funding. The rest of his presentation is without substance.

Iain Howe
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Exactly. "It'll look AAA and feel AAA but it'll cost Indy money".

Would you buy THAT car without kicking the tyres?

Andrea Di Stefano
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I agree, this sounds extremely vague for anyone that knows how the business works. The smaller-scope game doesn't detract from the initial investment of pre-prod, tech development etc. That said, I'm interested to know more and hopefully it won't amount to "find private investors".

In my opinion, working with publishers is not bad per se, the hard part is finding a good middle ground when defining the deals; And considering that on average, developers are more desperate than publishers it's easier said than done :p

Matt Boudreaux
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I loved the story/characters/acting in Heavenly Sword - but DmC left a nasty taste in my mouth (felt like it was trying to be edge-y for the sake of being edge-y). This just seems like a lot of buzzwords Tameem is throwing around without much substance. I guess we'll see what happens.

Matthew Calderaz
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I agree with you that the story and characters in HS was fantastic; however in DMC's case, when has the story *ever* been worth anything? The combat mechanics are fantastic and the slow but noticeable build up in difficulty was just about perfect IMO; and I don't think it's fair to fault the game for it's story when that's never been it's strong suit, (to be extremely generous to the series, actually.)

Theresa Catalano
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I disagree. The stories in the older DMC games were always cheesy, over the top, ridiculous and fun. They were stupid, but the characters were likable, and the cutscenes were a lot of fun to watch. Ninja Theory didn't seem to understand at all what made the stories entertaining, and their spin on it was to fill the whole thing with angst and artificial edginess. It really made the story and characters unbearable.

The combat mechanics in DMC were also a huge step down from the wolder games. Taken as it's own, it's a passable action game, just like the rest of Ninja Theory's games. But they don't really do anything interesting, mechanics-wise, with any of their games. Let's be honest... when it comes to action games, Ninja Theory are a third rate Platinum games. We honestly don't need them.

Robert Carter
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I agree with most of your post. However, the "We honestly don't need them." quote...

Why add groupthink into this? Who is this "we"? Many people enjoy Ninja theory games, an I actually really like one of the older ones myself (though I cant stand most of the others, including DMC, hence I agree with most of your post).

You and I can say we dont like NT games and dont plan on buying them unless there is a drastic change in design. But blanket statements that speak for others besides ourselves should be avoided.

Theresa Catalano
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You're right, that was a bad choice of words.

Ardney Carter
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@Robert Carter
That the post was written that way just reflects a style of speaking and I'm sure you understood this. I disagree with the inclusion of the last sentence as well but only on the grounds that it was unnecessarily rude and tactless.

The statement itself is 100% true. No one, not even fans of their prior work, NEEDS Ninja Theory or any other games company for that matter. They are not in the business of producing food, clothing, or shelter and therefore are not necessities. It would do anyone working in this or any other entertainment industry well to remember that fact from time to time.

Theresa Catalano
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I mean, it was just a figure of speech, let's not dwell on that. What I was trying to say is that Ninja Theory's games don't do anything interesting, mechanics-wise, and that they have nothing special to add to the realm of action gaming. In MY opinion, they are an unimportant developer that makes uninspired games. If they disappeared, once again in MY opinion, it would be no great loss to the gaming community. That's all I was trying to say.

Langdon Oliver
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Everything Ninja Theory has done during the PS360 generation has been aces in my book. Here's hoping they continue on PC and console and don't focus solely on mobile/tablet.

Langdon Oliver
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That Gamescom trailer for Hellblade did not disappoint.

Bram Stolk
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AAA is a vague and overused term.

Can you name a single AA game?
What are the A games and B games?

I think nowadays AAA just refers to budget.
It would be easier to just speak of $50M+ instead of AAA.
And by that definition you are not creating an indie AAA game.

Kevin Alexander
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AAA means its going to be positioned/marketed as a leader in a market place (like a top tier game in particular genre, or for a particular demographic).

Is going to be in the top percentile of budgets compared to similar games its positioned against.

Is supposed to also have high consumer confidence as well.

Though people seem to be generally comfortable with the more ambiguous interpretation of it relating to broadly subjective targets like quality alone.

BobbyK Richardson
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Isn't he basically talking about doing what Double Fine has been doing? Setting aside some experienced devs to work on pet projects?

Not a new concept... Although I'm a bit surprised at people's responses in the comments... Ninja Theory games have never jumped out at me as must-buys, and judging from the comments I'd say what they really need to work on is their consumer image and fan base... A hundred fans of companies like Double Fine would jump in to their defense, and despite Ninja Theory being around for so long, it doesn't seem they've built up the same kind of love.

Iain Howe
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Perhaps we've all been in meetings where we've been encouraged to 'go the extra mile' to produce AAA content on a less than AAA budget and it's made us cynical?

I don't think the 'pet project' angle is what's put people off in this article so much as the "The game looks and feels AAA, but is smaller and more focused, with a total budget that's a fracton of our previous games" quote.

Cory Johnson
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I know it's not much now, but I was a HUGE fan of Kung Fu Chaos when it came out.

Elphege Kolingba
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All the best guys, a really insghful story. Enslaved was a cool game, too bad there were no sequel, a co-op gameplay and a mobile companion app would have fit well with this IP.

On the side note, I must confess that "AAA independent game" sounds great :)