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Louie on 24 January 2009
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RVDondaPC said:
Louie said:
RVDondaPC said:
You will never know the profit from a video game. Never ever. So no we shouldn't be looking at profit, because well. We'd be looking at nothing.

 

Yeah sure... why using our head, right? I never said we should look at the profits from a single game but revenue is just silly to measure the success of a developer on a platform. Again, DS games are 40 Euro so they make 20 Euro less revenue from a DS game. Does that mean the games made them less money than the ones on the PS3?

And if the Wii accounts for 15% of the revenue, the games are cheaper at retail than PS3 / 360 games and the production costs are less, then it is valid to argue that they made just as much profit from the Wii.

 

Of course you have to look at profit and while you can't get exact figures there surely are some indicators if a developer made money on a platform or not.

 

And what are those indicators that they made money? The only numbers they'll give you for a given platform is... *drum roll* REVENUE. Factoring in development costs for multiplatform games is pointless. Which platform "costs" the developer for when they were brainstorming for new games? Which platform "costs" the developer for when they are designing the characters? Does the lead platform incure all the costs? Which platform incures the cost of writing the script? Recording the music? Advertising for the game? Does one platform unfailry bare the burden of the development cost? Or is it split evenly? 

 

Of course you have to consider their revenue (I completely agree here) but just blatantly looking at the revenue and saying the Playstation 3 made Ubisoft the most money is wrong. Only if you look at the revenue and take all other costs into account you'll get the complete picture. Grand Theft Auto IV for example surely is a huge source of revenue for Rockstar but the estimated development cost (+ advertising) is more than 100 million dollars. Imagine: Babies on the other hand sold 2 million copies or so but was so damn cheap to develop that it probably made almost as much profit in the end.

Just to remember you: I'm not one of the "PS3 is doomed" people just because I have an Xbox360 avatar. I'm a bit too old for the fanboy wars. I never said anybody will abandon the PS3, I just said this is the wrong explanation. I also don't argue from the "PS3 vs 360" point of view but from a financial one.  I'm sure Haze was a dissapointment for Ubisoft but it still made millions of dollars for them - if you don't take development costs into account.

Development costs are a huge factor today and a huge risk for developers so they surely have to be taken into consideration by every developer. If a developer only looks at revenues he is in danger of going bankrupt. This is probably the reason why Ubisoft has expanded its casual game development by such a lot: Less revenue but also less development costs and just as much profit in the end with a much lower risk (if you only spend half a million dollars on a game you can only lose half a million dollars). This is the deciding factor for developers, not revenue alone.

 

Edit: As a general example look at it this way: You can either develop a game with a budget of 10 million $ that will give you 15 million $ in revenue ( =5 million in profit) or a game with a budget of 1 million dollar that will make you 8 million dollars in revenue ( = 7 million in profit). Which one would you chose?

You see this is more a Wii/DS vs 360/PS3 thing as those two platforms have much lower development costs. I don't even remotely care if a developer puts a game on PS3 as lead platform or on 360, it doesn't bother me at all.