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Small Developers: Minimizing Risks in Large Productions - Part I
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Small Developers: Minimizing Risks in Large Productions - Part I

November 3, 2009 Article Start Previous Page 2 of 4 Next

The Top 10 Risks to Production - Numbers One to Four

1. Business Risks

As a small developer, you are often at constant risk, whether you realize it or not. Most small developers who only have a single project are usually at risk of having most of their money coming in from a single publisher for a single project.

Ten or more years ago, it was possible to find and sign a new project in a few days or weeks, as the process and requirements were much lower. Five to 10 years ago, it began to usually take three to six months to sign a new project (unless you were lucky or already a well known developer). Today, I hear that some teams negotiate for 12 to 18 or more months for new projects.

Publishers also used to pay for prototyping, as the costs for building a prototype could be $250,000 to $500,000 for a really good prototype for a major AAA console game.

However, costs have now doubled or tripled to build a prototype to the quality that most publishers would like to see, and now they don't want to pay for it either. This shoulders the heavy burden of building prototypes and funding them now on developers, which is risky and hard for most small companies to do.

Small developers must incur a lot more financial risk in today's game development market. They must deal with the burden of creating concepts for new projects, pitching new projects, developing prototypes, getting new projects signed, and hoping that their current project(s) don't suddenly get canceled.

If you are a small indie developer, you may be living from one milestone payment to another, or close to it, and probably won't have time to find a new publisher if your current project is canceled. If you own the rights to the game you are developing, and it is in reasonably good shape, you might have a chance of getting it signed quickly, but if you have to start over and find a new project, it could easily take four to eight months.

There is no easy answer on how to mitigate the risks of having your publisher cancel your project. The best advice is to be continually looking and negotiating for the next project or to try and ramp up a second team or project as soon as possible. The more diversified your income is, and the more additional funding sources you have, the more stable your company can be.

Also, while taking on a second project does have its own risks involved -- in that too much growth can be challenging for some teams -- there are many other benefits as well.

There are many costs associated with running a company, from the common space building overhead, to other non-production personnel who might be needed, like a receptionist, HR, accounting, management, audio departments, and much more. Having two projects allows a lot of these costs to be shared and helps the company significantly.

Also, look for other ways to diversify your business. You don't need to be locked into making "traditional" large scale retail console games anymore.

There are many new platforms and publishing options, online distribution, casual games, handhelds and other places to publish games more quickly and easily than you may realize. There are also many options to extend your games as well, so creating downloadable content, theme packs and other content can add a lot of extra income, while also extending the brand of your games.

2. Pre-Production Risks

The biggest risk related to pre-production is not having adequate (or any) pre-production at all. Some teams will jump right in and just start building the game, planning to adjust things as they go. The whole point of pre-production is to mitigate the creative risks of a project and build a plan which you know you can execute on and have proven is feasible.

Unfortunately it is very easy for a team to either work on the wrong stuff during pre-production, or to not work on things thoroughly enough, since the definition of pre-production is a little vague for most.

For example, teams have used all their pre-production time to test risky new game technologies and mechanics, but then failed to produce anything else. So, in this case, they succeeded in that they proved that their big new and hopefully cool feature sucked and wasn't worth doing, but on the other hand they chewed up 12 months and now have almost nothing to show for it -- and basically had to start over and prove that the new core idea was feasible.

Another common mistake is that people prototype a variety of features, but hack the code together. This code is usually meant to be redone, but now suddenly everyone assumes everything is "working" and that the game can be done much sooner than the team actually intended.

What you do in pre-production is just as important as how you do it.

Article Start Previous Page 2 of 4 Next

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