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Star Citizen Has a Huge Development Cost Problem

by Games and Data on 08/17/17 12:12:00 pm

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.

 

Star Citizen is a Must Watch

Love it or hate it, Star Citizen (SC) always proves entertaining. Watching the development process unfold, for what is essentially a crowd-funded AAA studio, is both fascinating and eye-opening. And no discussion of SC is complete without a nod to the incredibly polarized community that surrounds it. It seems many critics love to hate Star Citizen and its many backers. Meanwhile, diehard fans express their willingness to wait until the end of time for a perfect game to get shipped.

If you need a refresher, the original expected ship date for SC was 2014, but that was before the game grew exponentially in scope and raised over $156 million dollars! Today, backers are still waiting for the 3.0 Alpha release, which was scheduled for the end of 2016. And the single player spin-off of SC, Squadron 42, was initially slated for release in 2014, but it’s stuck somewhere in development hell.  

These massive delays have certainly provided fodder for critics, and it’s hard to blame them. When a company has taken this much money from gamers, and missed this badly on critical deadlines, it’s time to call them out. On the flipside, I understand the backers. This is the first major attempt at a well-developed space game in a very long time. People are ravenous for great titles to fill the space-themed game void, and SC hits all the right buttons for them. Beyond that, I think many backers see supporting SC as a big middle finger to many of the greedy and lazy AAA studious that have come to dominate the game space. This is a AAA game supported by gamers, for gamers, and that is truly exceptional!

I’m not a backer of Star Citizen, but I’m not a fanatical critic either. In fact, even though I’m not a big fan of online multiplayer games, I would jump all over this game if it weren’t for some enormous red flags. I am merely here to present some data and fill in the gaps with some logical steps. At the end of the day, I hate seeing people get fleeced, and I know the damage that could be done to Indie crowdfunding if SC is a failure. I don’t want this game to fail, but as I’ll layout in this series of posts, it doesn’t look good.

 

Three Acts

This series of posts will be presented in three parts. This post is part one, where I’ll compare the scope of Star Citizen to another ambitious game, GTA V, and from this, create a projection for development costs. In part two, I’ll use some math and business sense to estimate Cloud Imperium Game’s (CIG) cash position. In other words, I’ll put a number to how much cash I think CIG has left and how long it can continue development at this pace. I’ll also examine what would probably happen if CIG runs out of cash. Finally, in part three, I’ll explore the implications for crowdfunding games if SC fails, and some important lessons we can all learn from Star Citizen.

 

GTA V, a Huge Gamble and a Huge Win

I thought GTA V would provide a great basis of comparison to Star Citizen, mainly because both games have a very large scope. GTA V features a well-developed single-player campaign, multiplayer gameplay, an enormous map, tons of customizable content like cars and weapons, and hundreds of missions of all shapes and sizes. Unsurprisingly, it is the most expensive game to develop of all time, with an estimated development cost of $137 million. Tack on another $128 million for marketing, and you have the total cost for the original release of $265 million. Keep in mind this doesn’t include the cost of all the additional content releases and modifying the game for new consoles. So, the total cost today would be even higher. Despite the enormous cost, GTA V is a massive success, with over 80 million copies sold.  

 

Scoping It Out

To generate a fair estimate of development costs for SC, I’ll compare the scope of GTA V to the planned scope of Star Citizen. Next to each scope category I’ve put a quick comparison showing whether SC is greater than, less than, or equal to the scope of GTA V.

Platforms – SC < GTA V

GTA V was originally released on PlayStation 3 and Xbox 360, though work on the PC version was also underway at the time of release. In contrast, Star Citizen is being made exclusively for PC, at least as far as we know. That means less work for SC developers to get the game ready for release since they only develop for PC.

Models, Textures and Animations – SC = GTA V

GTA V has a ton of graphic assets like cars, guns, people, clothing, accessories, buildings, landscapes and more. Star Citizen has promised an equally dizzying array of assets including ships, land vehicles, weapons, characters and customizations. At my count, the current number of promised ships is over 100! I think they are close to even, but this depends on how ambitious CIG is with developing out different space stations and planets. Will they re-use a lot of assets or try to keep everything unique? I’m betting on quite a bit of re-use. If they go the unique route, the scope could easily dwarf GTA V.

Map Design – SC = GTA V

Map design was very extensive for GTA V. The amount of unique areas, details and placement of assets clearly took a tremendous amount of work. Star Citizen hopes to cut down on map design work by using procedural generation of planets. The issue is, getting procedural generation to generate 60+ interesting planets takes a lot of work by itself. And even with procedural generation, level designers will have to fill in the more unique content like bases and such. Procedurally-generating these is possible, but difficult, as No Man’s Sky has shown us. Because of the tremendous map size SC has planned, I think the two projects are about even.  

Engine Development/Multiplayer – SC = GTA V

Rockstar built on their proprietary RAGE engine for GTA V. This required massive modifications to meet the requirements for the latest GTA, but they weren’t working from a blank slate either. In comparison, SC is using Amazon Lumberyard, which works off CryEngine. Getting the core CryEngine to handle all of the physics and multiplayer has taken extensive modification of the core engine. I’m rating these as the same.

Missions and Tasks – SC = GTA V

GTA V features an extensive single player campaign as well as hundreds of multi-player missions. However, a lot of the multiplayer content was added after the initial release of GTA V and isn’t factored into the $137 million development cost. Compare this to Star Citizen which will have the Squadron 42 single player campaign with 70 missions, and many missions and tasks available online, some of which are already live.

Systems – SC > GTA V

This is where SC is much larger in scope than GTA V. While GTA V has good driving dynamics, a lot of the systems and mechanics are relatively simple. For example, shooting mechanics are nowhere near the level of complexity or refinement that you’d get with a first-person shooter like Call of Duty. Similarly, heists, robberies, purchases and upgrades, and even enemy AI isn’t that complex when compared to the promises from Star Citizen. SC is pledging FPS mechanics to rival major shooters, ship systems mechanics, access control, advanced ship physics and performance characteristics, cargo hauling, mining, space combat, salvage, cooperative ship crews, g-force effects, and more!

High-Paid Talent – SC > GTA V

No doubt GTA V shelled out some cash for talented voice actors, but Star Citizen’s lineup puts them to shame. Squadron 42 will feature celebrities like Gary Oldman, Mark Hamill, Gillian Anderson, and Andy Serkis, among others. Top talent like this doesn’t come cheap, and I expect SC will pay out far more for voice talent and motion-capture of these A-listers than GTA V did with their more sedate picks.

 

The Verdict

Star Citizen’s development should cost at least as much as GTA V, likely more. With the massive number and complexity of systems, the inefficiencies that come with standing up a new development studio, and the use of big-name actors for Squadron 42, it is realistic to expect development costs to exceed $137 million. This may not seem like a problem since SC has already raised $156 million and will likely raise much more before release, but there’s some other things we need to consider.

SC’s funding numbers don’t reflect returns, so we don’t know how much net cash SC has received to date, but it is less than $156 million, and after payment processing costs, probably less than $150 million. Plus, that $150 million also must cover marketing and sales costs, which for many games, are equal to development costs: Don’t fool yourself into believing Star Citizen can be a commercial success without sinking serious cash into marketing and sales.

Star Citizen has been a heavily publicized project, but it’s also built up quite a bit of negative brand equity from missed deadlines. Let’s make a couple of very favorable assumptions for SC. First, development cost for launching the finished project will be equal to GTA V, $137 million. Because it is widely known, SC doesn’t need to sink as much into marketing and only needs $68 million to get the word out to those living under a rock, and convince some of the long-time critics to get on board. Bear in mind, I’m including customer service costs and existing marketing costs, like website design and updates, into marketing. Most games don’t begin to incur these costs until they near release, but CIG must handle sales, marketing and backer updates during the entire development process. So, $68 million is a very favorable figure here! In fact, I expect CIG has already paid out millions just to compensate customer service and marketing staff.

This best-case estimate puts total cost at $205 million. With that, CIG would need to raise an additional $55+ million to have a successful launch, and this is assuming some very favorable development, return rate, and marketing numbers. If things are less favorable, that number would be much higher!

Now SC continues to pull in new sales every day. Monthly, they sell around $2 million. If they can keep that rate up for at least two and half more years, and meet these optimistic assumptions, they can make it. However, as the deadlines get extended and the time clicks by, I expect more people to press for refunds and less people to buy into the game. Plus, the next few months will probably be slow for sales due to the recent delays, with a big spike after Alpha 3.0 finally gets released.

 

TL;DR

Success is far from guaranteed: Star Citizen does not have enough cash to deliver the game they promised backers. Even under very optimistic assumptions, they need around $55 million more to finish the job. CIG must keep the sales up or they will be insolvent. This explains why SC releases a constant stream of new, previously-unannounced ships – they are trying to drive new sales. If there are major operational inefficiencies inside any of the CIG studios, or marketing and sales costs exceed $68 million, or returns reach significant levels, or future sales drop off prior to release, this game cannot be delivered as promised!


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