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Wii game budgets 1/4 of HD budgets according to EA

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Does this really take that much thinking? Of course graphics and the size of a game eat up budgets.



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Its true, an average HD development can cost 20 mil, whereas average Wii development costs 5 mil.

A 20 member team can make a Wii game, where you'll need at least twice the size team for an HD project.



So they could put out four wii games instead of one HD game and hope to get the same profit



non-gravity said:
So they could put out four wii games instead of one HD game and hope to get the same profit

Closer to 2-3 games than 4.  You still have marketing, distribution, etc...that would cost more than the same stuff for just the 1 HD game.

 



The rEVOLution is not being televised

HappySqurriel said:

@Groucho

Lets compare apples to apples ... Ratchet and Clank took Insomniac 40 developers 18 months to develop (a feat you said was the sign of shovelware in a previous thread) and Ratchet and Clank Future took insomniac 70 full time developers, 30 shared developers, and 25 contractors 23 months to complete.

http://www.gamasutra.com/view/feature/2842/postmortem_insomniac_games_.php?page=3
http://www.gamasutra.com/view/feature/3889/postmortem_insomniacs_ratchet__.php?page=4

You seem to be the only person in the entire videogame industry to think that there has not been an explosion in development costs from the previous generation to the current generation.

I think you misunderstand my point of view.  Costs have gone up.  What I'm saying is that costs have gone up for the Wii as well -- but only if you want to produce something that appears to the user as being high quality.  These "Wii development costs are 1/4th to 1/3rd" of HD costs are correct, but its not for the reason that many people on the forum seem to think.

Because so little money (yes last gen games cost about as much -- "quality" is a moving picture, even for the Wii -- I assumed you could deduce that for yourself) is spent on Wii development, Wii games tend to come out with relatively low sales numbers, and many are downright flops, due to the correct user perception that they are low quality for this day and age.  $5M dev costs, coupled with advertising budgets and lower per-unit profit (Wii games cost less) mean that, for a low quality Wii game to succeed, it has to sell nearly as much as a HD game.  Take these factors into account:

 

  • Advertising costs are the same, given the same grade of advertising.  Advertising and marketing cost nearly as much as the dev costs in the last generation (say ~$5M for a $5M game last gen).
  • If an average crossplat HD game takes $15M to develop, and lets lowball adverts and marketing at $5M this gen, that's $20M total.  According to sources posted by Viper above, the game needs 750K sales to break even, 360+PS3 combined.

If an average Wii game costs $5M and we add the low-balled $5M marketing budget, that's $10M.  Also consider that the average profit per Wii game is about 85% of what the average profit per HD unit is, due to lower retail prices.  If we use the HD number as a basis, 750K/0.85 = ~882K.  Cut that number in half, because we only spent half as much on the Wii game 882/2 = 441K to break even on the Wii alone, not the 250K someone earlier believed it to be.

I'm merely trying to put forth that its not as cut-and-dried as "Wii costs less to develop for, so its a better platform to develop for, with regards to profits".  Its not that simple.  Development isn't the whole picture, and frankly a large portion of the "costing less" comes from publishers trying to push games of early-last-gen quality onto the user, which further hurts a game's ability to garner sales.

Publishers need to concentrate their money on better/more expensive Wii projects, rather than more/cheap Wii projects, and then, thanks to the Wii's rapidly growing userbase, they will make good profits.  The 1/3rd to 1/4th numbers put forth by various publishers are not about efficiency of development on the Wii for worthwhile projects.  They are about cutting corners on the Wii, and scramling to tackle the casual market.  That's not a good thing.

 

 



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Squilliam said:

stribution costs are another significant expense. It costs more per game to ship fewer titles more often than it costs to ship 40-60 titles at once to a store. When the game gets there it has to compete for shelf space with "market development funds" or it has to justify a good position with continued sales and with low development there are a tonne of games pouring in gunning for that shelf space.

I'll put it in bullet points to make it easier:

  • Costs more per title to ship with smaller shipments.
  • Greater competition for shelf space from other titles.
  • Retailers are hesitant to re-order games that are selling slowly

Thats compared to HD console titles which tend to sell quickly and justify their shelf positioning. Which is why they get prime billing in the stores.

 

 

I agree that my analysis inadvertently and incorrectly omitted distribution costs.

However, I am not sure this is as much of a factor as you make it out to be. This is because the manufacturer ships to a wholesaler or distributor who then sends the games to retail outlets.

The shipments to retail are mixed of all game types. I can only speak to what I have seen in the US. For example, Gamestop shipments often come with a variety of different games for different systems. So you might see Wii, DS, PSP, PS3, Xbox 360 and PC all in the same big box.  The only exception is the big pre-sale reserved games. Those are shipped separately (or picked up at central points by employees). That is more costly and more often than not is for those front-loaded sales of games commonly assocaited with the PS3 and Xbox 360.  The same basic thing is seen for small, independent game stores -- ground shipments of most games and restocks, air shipments of the big blockbusters.

As for store placement and shelf space -- that is a factor of marketing. Companies provide reasons/inducements/considerations for companies to place their product.  This is seen in stores small and big alike -- but different companies focus on different segments (for example, Nintendo really does not do much with smaller game stores).

 

Mike from Morgantown

 

 



      


I am Mario.


I like to jump around, and would lead a fairly serene and aimless existence if it weren't for my friends always getting into trouble. I love to help out, even when it puts me at risk. I seem to make friends with people who just can't stay out of trouble.

Wii Friend Code: 1624 6601 1126 1492

NNID: Mike_INTV

Well then...lets make all games look like ass. Take out achievements...no online...yes this is good news for industry. Nintendo saves the industry again.



^^^^ You forgot the /Emo at the end of your post, disolitude ;P A little over the top much? Cause I'm sure that every Wii game looks like ass and has no online.....

Seriously, I expect more from you than such a blind teenage fanboyish lashout like that.



Groucho said:

 

  SMG at $16-17M is above that $15M line, and its a quality game -- as I've been saying all along, it has nothing to do with the platform, and everything to do with investment.  As a general rule, and I don't know how many times I have to state it, Wii games are cheap because they suck.  And, conversely, as a general rule, Wii games suck, because they are cheap.  Wii games that don't suck, are, outside of being really rare and almost all 1st party, almost universally as pricey as HD games to make. 

 

SMG and GTA IV have the highest average critic scores this generation.

Groucho says SMG cost $16M-$17M

It is accepted that GTA IV cost $100M

http://www.google.com/search?q=gta+iv+development+costs&ie=utf-8&oe=utf-8&aq=t&rls=org.mozilla:en-US:official&client=firefox-a

So development for the highest end games are 6x on the PS3/Xbox 360 than for the Wii.

And SMG would be below a variety of big name games, from FF7 to Killzone.

http://www.neogaf.com/forum/showthread.php?t=325745

Finally, I agree that cheaply made games are generally bad.  But price -- nor cost -- do not always reflect quality.

 

Mike from Morgantown



      


I am Mario.


I like to jump around, and would lead a fairly serene and aimless existence if it weren't for my friends always getting into trouble. I love to help out, even when it puts me at risk. I seem to make friends with people who just can't stay out of trouble.

Wii Friend Code: 1624 6601 1126 1492

NNID: Mike_INTV

bardicverse said:
^^^^ You forgot the /Emo at the end of your post, disolitude ;P A little over the top much? Cause I'm sure that every Wii game looks like ass and has no online.....

Seriously, I expect more from you than such a blind teenage fanboyish lashout like that.

 

My post wasn't directed towards nintendo but the blind fanboys that keep screaming "HD gaming is runing the industry".

In gaming jsut like everywhere else, usualy you get what you pay for. Plus it eventually comes down to good developers spending money and bad developers spending money...reguardless of the console.

I mean, Gears of War cost 10 million to make...worth every penny in my opinion especially considering Red Steel on the Wii cost 12 mil...