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"A lot of games have unrealistic forecasts"

Ninja Theory's Dominic Matthews on breaking out of the squeezed middle

Over the last few years, the industry has seen budget polarisation on an enormous scale. The cost of AAA development has ballooned, and continues to do so, pricing out all but the biggest warchests, while the indie and mobile explosions are rapidly approaching the point of inevitable over-saturation and consequential contraction. Stories about the plight of mid-tier studios are ten-a-penny, with the gravestones of some notable players lining the way.

For a company like Ninja Theory, in many ways the archetypal mid-tier developer, survival has been a paramount concern. Pumping out great games (Ninja Theory has a collective Metacritic average of 75) isn't always enough. Revitalising a popular IP like DMC isn't always enough. Working on lucrative and successful external IP like Disney Infinity isn't always enough. When the fence between indie and blockbuster gets thinner and thinner, it becomes ever harder to balance upon.

Last year, Ninja Theory took one more shot at the upper echelons. For months the studio had worked on a big budget concept which would sit comfortably alongside the top-level, cross-platform releases of the age: a massive, multiplayer sci-fi title that would take thousands of combined, collaborative hours to exhaust. Procedurally generated missions and an extensive DLC structure would ensure longevity and engagement. Concept art and pre-vis trailers in place, the team went looking for funding. Razor was on its way.

"Games like Enslaved - trying to get a game like that signed now would be impossible"

Except the game never quite made it. Funding failed to materialise, and no publisher would take the project on. It didn't help that the search for a publishing deal arrived almost simultaneously with the public announcement of Destiny. Facing an impossible task, the team abandoned the project and moved on with other ideas. Razor joined a surprisingly large pile of games that never make it past the concept stage.

Sadly, it's not a new story. In fact, at the time, it wasn't even a news story. But this time Ninja Theory's reaction was different. This was a learning experience, and learning experiences should be shared. Team lead and co-founder Tameem Antoniades turned the disappointment not just into a lesson, but a new company ethos: involve your audience at an early stage, retain control, fund yourself, aim high, and don't compromise. The concept of the Independent AAA Proposition, enshrined in a GDC presentation give by Antoniades, was born.

Now the team has a new flagship prospect, cemented in this fresh foundation. In keeping with the theme of open development and transparency, Hellblade is being created with the doors to its development held wide open, with community and industry alike invited to bear witness to the minutiae of the process. Hellblade will be a cross-platform game with all of the ambition for which Ninja Theory is known, and yet it is coming from an entirely independent standpoint. Self-published and self-governed, Hellblade is the blueprint for Ninja Theory's future.

"We found ourselves as being one of those studios that's in the 'squeezed middle'," project lead Dominic Matthews says. "We're about 100 people, so we kind of fall into that space where we could try to really diversify and work on loads of smaller projects, but indie studios really have an advantage over us, because they can do things with far lower overheads. We have been faced with this choice of, do we go really, really big with our games and become the studio that is 300 people or even higher than that, and try to tick all of these boxes that the blockbuster AAA games need now.

"We don't really want to do that. We tried to do that. When we pitched Razor, which we pitched to big studios, that ultimately didn't go anywhere. That was going to be a huge game; a huge game with a service that would go on for years and would be a huge, multiplayer experience. Although I'm sure it would have been really cool to make that, it kind of showed to us that we're not right to try to make those kinds of games. Games like Enslaved - trying to get a game like that signed now would be impossible. The way that it was signed, there would be too much pressure for it to be...to have the whole feature set that justifies a $60 price-tag.

"Yes, we've enjoyed working with our publishers, but that's not to say that the agreements that developed are all ideal, because they're not"

"That $60 price-tag means games have to add multiplayer, and 40 hours of gameplay minimum, and a set of characters that appeal to as many people as they possibly can. There's nothing wrong with games that do that. There's some fantastic games that do, AAA games. Though we do think that there's another space that sits in-between. I think a lot of indie games are super, super creative, but they can be heavily stylised. They work within the context of the resources that people have.

"We want to create a game that's like Enslaved, or like DMC, or like Heavenly Sword. That kind of third-person, really high quality action game, but make it work in an independent model."

Cutting out the middle-man is a key part of the strategy. But if dealing with the multinational machinery of 'big pubs' is what drove Ninja Theory to make such widespread changes, there must surly have been some particularly heinous deals that pushed it over the edge?

"I think it's just a reality of the way that those publisher/developer deals work," Matthews says. "In order for a publisher to take a gamble on your game and on your idea, you have to give up a lot. That includes the IP rights. It's just the realities of how things work in that space. For us, I think any developer would say the same thing, being able to retain your IP is a really important thing. So far, we haven't been out to do that.

"With Hellblade, it's really nice that we can be comfortable in the fact that we're not trying to appeal to everyone. We're not trying to hit unrealistic forecasts. Ultimately, I think a lot of games have unrealistic forecasts. Everyone knows that they're unrealistic, but they have to have these unrealistic forecasts to justify the investment that's going into development.

"Ultimately, a lot of games, on paper, fail because they don't hit those forecasts. Then the studios and the people that made those games, they don't get the chance to make any more. It's an incredibly tough market. Yes, we've enjoyed working with our publishers, but that's not to say that the agreements that developed are all ideal, because they're not. The catalyst to us now being able to do this is really difficult distribution. We can break away from that retail $60 model, where every single game has to be priced that way, regardless of what it is.

"We can now say our game is going to be 20 quid. We can make a game that is appropriate for that level of pricing."

Driven into funding only games that will comfortably shift five or six million units, Matthews believes that publishers have no choice but to stick to the safe bets, a path that eventually winnows down diversity to the point of stagnation, where only a few successful genres ever end up getting made: FPS, sports, RPG, maybe racing. Those genres become less and less distinct, while simultaneously shoe-horning in mechanics that prove popular elsewhere and shunning true innovation.

While perhaps briefly sustainable, Matthews sees that as a creative cul-de-sac. Customers, he feels, are too smart to put up with it.

"Consumers are going to get a bit wary of games that have hundreds of millions of dollars spent on them"

"I think consumers are going to get a bit wary. Get a bit wary of games that have hundreds of millions of dollars spent on them. I think gamers are going to start saying, 'For what?'

"The pressures are for games to appeal to more and more people. It used to be if you sold a million units, then that was OK. Then it was three million units. Now it's five million units. Five million units is crazy. We've never sold five million units."

It's not just consumers who are getting wise, though. Matthews acknowledges that the publishers also see the dead-end approaching.

"I think something has to be said for the platform holders now. Along with digital distribution, the fact that the platform holders are really opening their doors and encouraging self-publishing and helping independent developers to take on some of those publishing responsibilities, has changed things for us. I think it will change things for a lot of other developers. "Hellblade was announced at the GamesCom Playstation 4 press conference. My perception of that press conference was that the real big hitters in that were all independent titles. It's great that the platform holders have recognised that. There's a real appetite from their players for innovative, creative games.

"It's a great opportunity for us to try to do things differently. Like on Hellblade, we're questioning everything that we do. Not just on development, but also how we do things from a business perspective as well. Normally you would say, 'Well, you involve these types of agencies, get these people involved in this, and a website will take this long to create.' The next thing that we're doing is, we're saying, 'Well, is that true? Can we try and do these things a different way,' because you can.

"There's definitely pressure for us to fill all those gaps left by a publisher, but it's a great challenge for us to step up to. Ultimately, we have to transition into a publisher. That's going to happen at some point, if we want to publish our own games."

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Latest comments (6)

Simon Dotschuweit MD SE / CTO, Dorado Games4 years ago
Really awesome guys what level of info you share and the conclusions you arrived at in the independant AAA pro, this is gold for many devs (us included)! The best read on this direction I have seen in a long time, gotta read it again right away :)
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"I think consumers are going to get a bit wary. Get a bit wary of games that have hundreds of millions of dollars spent on them. I think gamers are going to start saying, 'For what?'
why do or would consumers care how much a game cost to produce? they/we just care about the final product. If it takes a few hundred million to make the next Red Dead Redemption, so be it, what do I care I just want the game to be great. This pretty much goes for all consumer products, I dont care about research and development cost,etc.. I just want a great product at a reasonable price, how much it cost to realize isnt my problem nor my concern. The beauty of supply and demand, consumers rule.
For smaller devs, the key is to find niches in the market and to serve that niche well.

Edited 1 times. Last edit by Todd Weidner on 20th January 2015 7:26pm

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Morville O'Driscoll Blogger & Critic 4 years ago
I just want a great product at a reasonable price, how much it cost to realize isn't my problem nor my concern
But those two things are related, at least a little. There's games on Steam that cost 5, and they can be sold for that price due to the dev costs being (relatively) low. GTA V, though (as an example) is being sold for 40 on Steam, and that's at least partly due to the massive dev and marketing costs. If a consumer can derive as much enjoyment from a 5 game as a 40 one, then I think there will be a backlash of sorts against more costly games. Whether it's a large backlash or a small one... Well, that at least partially depends upon how the games-industry consumer-base matures, I think. :)
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Greg Wilcox Creator, Destroy All Fanboys! 4 years ago
@Todd: Consumers are already asking that cost question and have been for a few years. Granted, a great deal of those questions are stupid ones from those who don't get that AAA game development (or most game development, actually) isn't all that cheap and a few dozen to hundred million spent doesn't translate to a 60-hour game experience in every case.

But some of those queries and comments are legitimate gripes. Particularly when an expensive to produce and market product arrives riddled with bugs and/or requires a big day one patch to run out of the box (or once downloaded, adding more time to the so-called speedy digital experience). But I guess games are meant to be flawed creatures striving for acceptance among a consumer base that both wants to know and yet doesn't know (or need to know) where every dollar went during that production time...
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If a consumer can derive as much enjoyment from a 5 game as a 40 one, then I think there will be a backlash of sorts against more costly games. Whether it's a large backlash or a small one... Well, that at least partially depends upon how the games-industry consumer-base matures, I think. :)
well we can all hope for small devs to rival AAA some day, but as of right now I see nothing in low priced games that can match the quality and depth of GTAV as it is pretty darn impressive and worth every penny IMHO. I paid $60 bucks for AAA games 20 years ago, for the price to remain the same is actually quite amazing, and hence why production cost means little to me as a consumer. What matters is quality and price, and price is a bargain.
As for the consumer base? its already 35+ years old on average, that's pretty mature.

Edited 2 times. Last edit by Todd Weidner on 22nd January 2015 2:46am

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Chris Payne Managing Director & Founder, Quantum Soup Studios4 years ago
You spent $60 on games in 1995? Really?
I bought Quake on release day for 29.99 in 1997. Accounting for UK inflation that's about 50, so in real terms the price of AAA has indeed stayed about the same. But the work involved in Quake and the work involved in Destiny are an order of magnitude apart! I suspect the only reason the price can stay so low is because of the growth of the market, but sooner or later that market expansion will level out. Arguably this has already happened, especially when you factor in the enormous smartphone market which has reduced the casual sector's desire for custom gaming hardware. So what happens is that all the AAA talent is gradually gathered together on the few biggest projects (GTA, AC, CoD) as their competitors fall. This enormously reduces consumer choice and developers' creative freedom.

Thank the gods for the booming indie sector, is all I can say.
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