mrstickball said:
Not quite, Freebird. Torillian is closer to the truth. Here's a great article on Gears of War, and the cost breakdown of the game - assuming it sold 1 million copies. The breakdown that was given for Gears, a $10m game plus marketing and such is as follows:
In this case, all of the bolded expenses would of been taken care of by Microsoft or Mistwalker, and are part of the cut they would receive from the project. This totals roughly $45.00 of each $60 copy sold. So we can assume, then, that $45.00 of each copy sold went back to Microsoft/Mistwalker. Now, how it was split up is questionable. At 850,000 copies shipped to retailers (which may be low, depending on how you want to take it), Lost Odyssey has made Microsoft/Mistwalker around $38,250,000 in Gross Revenue. Now, having said all of this, Lost Odyssey's budget, at the highest, was put around $20m + marketing. This would signal that the end budget was most likely around $25m for the game. Assuming all of those costs, LO still made money due to the simple fact that Microsoft published it, and waived any fees associated with the game, since MS bankrolled the whole project - unlike Gears where they just distributed it. So then we can take these charts, and get the following numbers on what a developer makes, depending on how the game is published:
Now, what I am stating by the difference in Gross Revenue/Game and Actuals is marketing, and other costs that didn't directly relate to making the game, but bringing it to market...Which is a $7.00 fee per game. So then we can assume that a really bad 3rd party with no publishing/distributibng abilities makes just under 50% of the $60 per game, and a 1st party makes a whopping 75%.
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You're right, I was confusing the retail cost with the royalty fee (went back and checked the article I was getting my info. from). However, when it is all said and done, it does come close to around $50 per copy.
Edit: Of course, I was using much higher shipped figures, yours are likely much closer.
