The 2009 Holiday Issue of PC Gamer magazine features an article by indie developer and Tripwire President John Gibson entitled “From Rags to Retail.” Gibson recounts the many trials associated with starting a new game development studio.  “We had sacrificed every second of spare time for almost two years” to create Red Orchestra, recalled Gibson.

Some of us even left our jobs to work on the mod full-time with hopes of winning the [Epic/Nvidia Make Something Unreal] contest. For the final four months before submitting the mod, I’d…code for 18 hours [a day]. My wife brought me food at the computer so I wouldn’t have to stop programming.

Gibson cites a number a factors in the success of Red Orchestra, such as timing, talent, and “a little luck.”

In fact, successfully distributing independent media products requires a lot more than luck. I recently published a case study about an independent film studio called Yves Productions. The case synopsis reads:

After years of hard work and an investment of nearly $1 million, Yves could not find anyone to distribute his film. At the time of the case, it was difficult to get distribution because there were more films on the market than ever before. Historically, it took more effort to make an independent film, and distribution was easier to secure. When the digital revolution began, the market was flooded with more independent films than distributors could handle. By 2001, independent films were a commodity and DVD distribution deals were plentiful, but theatrical distribution was almost impossible to get because there were more independent films than screens to put them on.

Alex Yves encountered many of the same roadblocks as Gibson. Like Gibson, he thought he had it made with strong Hollywood connections, a well-known international cast, an experienced director, and a considerable investment to make the film as professional as possible. Yet, distributors would not release the film unless he relinquished nearly all the rights (and potential profits). The film remains unreleased to this day.

During case research interviews, Yves admitted that one of his biggest mistakes was not securing distributor support prior to sinking considerable sums of time and money into his film studio.

The case has several parallels in the video game industry. The problem in both film and video games is that the sheer quantity of product on the market increases the risks for distributors that need to incur marketing and promotion expenses. In much the same way as the advent of new technologies like cheap HD camcorders allowed anyone to become a film producer, new easy-to-use development tools are transforming the video game industry.

One of the lessons Yves discovered was that no matter how good your product is, it is important to secure contracts early in the process. Media Molecule, for example, secured funding from Sony long before Little Big Planet was even in the early alpha development stage.  Media Molecule founder Mark Healey went to Sony, even though he was sure they were going to think “we were a bunch of mad men,” given how unusual the Little Big Planet concept was, and the fact that 2-D platformers had fallen out of favor.

The Sony partnership proved critical to Little Big Planet’s success. Not only did it provide the funding needed to ensure a quality product, it opened promotional opportunities that would be unavailable to indie developers who are without deep pocketed sponsors.

What lessons do these cases demonstrate?

• Develop a comprehensive marketing and distribution plan before you become too involved in your project.
• If possible, try to secure funding and distribution contracts before you get too far into development. Even if the terms seem like most of the benefits accrue to the distributor, in a saturated market, going alone will prove exceedingly difficult.
• Don’t assume that because you have a great product that distributors will come knocking on your door. Yves Productions had film stars and an established director. Gibson won the Epic/Nvidia contest. Yet, both had a hard time finding someone to promote their products.
• Don’t assume that you need a working beta to pitch your idea. Media Molecule only had a concept when they went to Sony for funding.
• Be willing to take risks and try new things. Red Orchestra’s success is directly traceable to the fact that it was one of the first third party exclusives available on Steam.

Of course, even if you follow all of these lessons, success is far from guaranteed. As Gibson points out, the path to success is long and hard. However, large distributors, such as Sony, Microsoft, and Steam are realizing that most of the important innovations in the video game industry are coming from independent developers. Large game studios simply can’t afford to take the types of risks needed to bring products like Little Big Planet to market. That niche will always belong to indie studios.

David Wesley is the research manager for Northeastern University's Institute for Global Innovation Management and author of the forthcoming book Innovation and Marketing in the Video Game Industry: Avoiding the Performance Trap.