Nov 5th, 2020
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  1. “There seems to be this common thread that I’m reading, mostly from Reddit so got to take that with a grain of salt. But there’s this idea of ‘the developers already got paid’. I’ve seen that before, I’ve seen it in the past, and I’ve seen it most recently with the Hogwarts game. I’m sure you guys have seen that too, right? You’ve seen someone mention something along the lines of that, and that’s another thing I want to address and talk about. Money comes into a studio, and then what happens? So let's say the game costs, I'll just pick a nice and round number for everyone to understand, $10 million to make the game. Okay? So that’s based on the full design of the game, and any other ancillary costs that may need to go into it. Not every studio has their own motion capture or voice over, like studio internally, so they have to outsource that. So, that’s some portion of the money. Some studios have pretty good animation, but they may need some additional help to get stuff done, so they outsource that. The bigger outsource is art, so there are a lot of art studios in the world, that is all they do is art, 3D or 2D, alright? So the studio offloads that work to them. You see it also in multiplayer games. Where the main studio is building the core of the game, and then what gets encapsulated is this concept of ‘netcode’, that’s a whole nother conversation but, all of that might be offloaded to a separate company that handles that side of it....This concept of “they’ve already been paid”, it doesn’t quite work that way, because they’re many buckets that money is going into when you’re talking about how a game is made. So if a game costs $10 million dollars to make, and you’re XYZ developer, that doesn’t mean XYZ developer has $10 million dollars in their bank account now and that they can go buy Tesla’s or whatever they want. It doesn’t work that way. They’re producers in line for that, and the money is not paid in a lump sum to them. It’s paid by milestone. Let me explain what that means. So if you have the design doc, which is like the Bible for the game, every facet of the game in written form, and there’s pictures, and there’s links, and there’s videos to watch which are referencing other games. All of that stuff is in the design doc. Outside of that comes the budget, and connected to that budget is the milestones to which each one of those things that is referenced in the design doc will be delivered. So you have your basic framework, your first couple of milestones of pre-production is getting the wheels on the thing. And then on and so forth. You may have a couple of milestones are just art, may have something that’s ‘Okay, this is done with motion capture and animation can start coming online.’ You see this full schedule. The average game, anywhere between 24 to 46 months to make it. If you’re looking at big Triple A games like Rockstar, 6 to 8 years. Whenever they “turn in” that milestone, so when they check that code and show it to the publisher, the publisher sees what they’ve done. Sometimes it’s just, there’s no code or game to look at, just ‘we did these things’. You listen to a couple tracks of music, or something and look at the raw animation set, or look at concept art. Check off on their design doc. All of those things can be baked into pre-production. And the publisher reads through that and goes ‘Yep, checkmark, here’s your payment”, and that payment will be a fraction of that $10 million. So, it’s like turning on an invoice and saying ‘look we did all of this stuff.’ and the publisher checks that off and says ‘Yeah, you did, here’s your money’. And that goes lock and step down the milestone calendar over the X years it takes to make the game. Okay? There may be a month where they may need to outsource a whole lot of work. So they may need $500,000 of outsourced art, a million dollars worth of animation work done, so on and so forth. So there may be a $2 million milestone, but $1.5 million is leaving the studio and going somewhere else. So it’s not they’re money to hold onto. They have to pay someone else to make the stuff. So, it’s not as black and white as people tend to think of it as ‘they already got paid’, well no they didn’t. They’re getting paid in what is called ‘rears’, they have to do the work first, show they did the work, and then they get paid. Sometimes they get paid some portion of it before it can happen, but it’s the smartest way to do it. Features and stuff in a game may take several milestones to complete, so you may pay for portions of things, but just because you paid half a million dollars for example, Friday the 13th, everyone knows we don’t get to finish the Grendel for the Uber Jason content. It’s a pain spot, it hurts my heart, it hurts your heart. It’s a thing. We were told the stop, so we stopped, but we stopped through that milestone calendar that we’re talking about. So when people were like ‘Why don’t you just finish it’. These things happen in lock step, milestone 6,7,8 had to be done before 9, and 9 was when we were completely done with that content. So we paid 6,7,8, we paid those, checkmark, they did it. The last thing was polish stuff, and we had to stop. So, the content was somewhat completed, but not. Which is always that weird argument of “you’re not doing that because you don’t want to spend that money.” I already spent that money. So, this argument or discussion of ‘the developers have already been paid for it’, it’s not that black and white, it doesn’t work quite like that.”
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