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Slimebeast on 10 May 2010
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elticker said:
Slimebeast said:
elticker said:
I am gonna buy it :) and that makes it a comercail success. though i have to admit some remedy fans are buying 2 copies of alan wake one standard and LCE or three and thats dedication :). I am 100% sure this game is gonna be a commercail success but the question is to what level of commercail success it is. it neds to sell less than a mil to break even. estimated cost of creating it is from 15-30 mil. causeon the alan wake forum it say 7 mil before microsoft signed the deal so it will break even with less than a mil and this game is gaurnted to sell more than a mil so its on what level of comercail success if i had to guess LTD i would say anywhere from 1.5-4 mill

No. 1 million copies will not be enuff to break even.

If costs were $7 million before MS deal, then there's an additional 4 years of development costs. 

Remedy team is 45 men. 45 x $100,000 = $4,5 million per year, but they outsourced some artwork so let's say $5,5 million in best case. In 4 years that's $22 million. Total budget is $29 million.

+ 10 million marketing = total cost $39 million minimum, and I am being nice here (Finland has a high cost of labor + small team has more fixed costs which raises the $100k man year average, plus $10 mill is kids stuff in marketing of an exclusive who even got it's own little live mini-series).

For each copy sold revenue $30 in best case => 39 mill / $30 = 1.3 million copies to break even (not including bundled copies or Platinum releases)

acctually each copy is 48. 36 to publisher/developer, 12 for console royalities since microsoft is publisher they wont pay themselves pay console royalities. That means if it sells 1 mil it getts about 48 mill. besides there isnt a marketing campaign for alan wkae nto as far as i heard. There may be a small one with a 2 or 3 mil but nothing with a 10 mil marketing campaign as far as i know.

GameStop and small retailers pay $48 for new copies of the first shipment, yes. But Walmark and others buy them for less. And second shipment is cheaper for everybody. So before we even get to talk about the effect from Platinum releases ($15-20 revenue) and bundled copies ($0 in revenue), we're already down at $40 before Microsoft takes his share.

Also you have to subtract distribution, printing, packaging, transport and loss from broken & stolen goods from those $40 that the retail pays. So your're down on $35-37. But as soon as you start including GOTY and Platinum editions and bundled copies, that number is gonna fall dramatically.

Marketing is at least $10 mill. It works like that in business. No sane person would develop a game for $29 million and then only spend a fraction of that amount on marketing. $3 mill for marketing would only be 10% of the total budget.

A good rule of thumb is to take 30% of the development budget to get an estimated minimum marketing budget. 0.3 x $29 mill = $9 mill for Alan Wake

Sometimes the marketing budget is even higher than the dev budget (CoD, Halo).