Saturday, May 1, 2010

The Four Principles of Independent Game Publishing

Jackson Pope over at Reiver Games has a sad post here where he says he's going to have to shut down his company for economic reasons. He's been hinting at this for a couple months; I looked at what I could figure out about the economics of his venture here.

He's in a situation I imagine myself being in in a couple years. He's got piles of games in storage, and they're not selling very quickly. He's got another game in the works, and was at the point of making the big bet - the big initial investment to get it printed, in this case £15,000, or $23,000. He's made that bet three times, and from his earlier posts, it sounds like the bets have actually paid off, albeit barely. But (a big but, I cannot lie) he's not making any money to support himself, and he's got ongoing expenses (storage, loan payments) that have to be paid. So, he's not willing to ante up a fourth time - a reasonable decision. You have to know when to fold 'em.

In this recent post, he says the value of his stock (games on hand) is actually equal to the amount of money he's invested in the company so far. The value he uses here is the printing cost, so even if he sells at a deep discount, he gets his initial money back, assuming he can sell out at a discounted cost-of-goods price. That's breaking even - actually an acceptable place to be for most independent game designers/publishers who aren't trying to make a career of it, as Jackson has, but it's a place they're not likely to reach, since Jackson's already done a bunch of this right - good designs, reasonable production costs, a network of distributors, going to the trade shows. Any one of those things is easy for an indie publisher to mess up, and then they wouldn't even be where Jackson is, barely breaking even.

What's the lesson here? There are several; take your pick. I've ordered them on a scale of diminishing practicality (and increasing insanity):
  1. Don't ever get into this loser of a business - find another job. Resign yourself to crushed dreams.
  2. Try only to get your designs published by an existing company - that way, somebody else is placing the big bet, on you, with their money. Resign yourself to hours of work in pursuit of almost-guaranteed disappointment. Often functionally equivalent to #1, but with a bunch of futile labor and postage.
  3. Publish through a print-on-demand service. Resign yourself to obscurity, tiny profits, and single-digit sales.
  4. Go it alone, as Jackson did, and resign yourself to hours of work, losing money, obscurity and tiny profits, and then crushed dreams - all the above on one easy package.
I'm considering doing #4, which probably certifies me for institutionalization, but I'm going in with several major caveats learned from Jackson's experience and from the rest of my life. Let's be grandiose here and call these The Four Principles of Independent Game Publishing:
  • Don't borrow money - this is probably going to be a really bad investment; only do it with the part of your own money you can afford to set on fire.
  • Have another job - you're not going to support yourself with this; destroy any hope of doing so before going in. You won't make rational decisions otherwise.
  • Minimize ongoing expenses - these are things like web hosting, storage, salary - you can't get these to zero, but a web site can be $50 a year, and you can store stuff in your kitchen, closet, or basement and do the work in your spare time.
  • Be willing to give up - that's where Jackson is; and he's clear-eyed enough to get out while he's avoiding a loss - and realize that you will need to give up at some point.
Depressing, eh? But if you can do all four of those things, I think you can still have a good experience with it. My goal is less to make money and more to get my designs in print, which isn't likely to happen any other way. The business end of it will either work or it won't; I'll learn from that while not counting on it for food and rent. I used the same approach to my shareware company, which had, at least initially, the advantage of nearly no overhead costs.  But at the start, I got it going by following all four of the principles above. Luckily, it succeeded; if it had failed, I'd still have been employed and living a good life.

We'll see if I can make this work too.  Best wishes to Jackson Pope - he's at least been able to live the dream for a while, which is more than most of us can say.

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