Counting Rupees: Sustainable Indies

Each week Jeff Engel and Geoff Brooks contribute Counting Rupees, a column on the business behind gaming:

Braid was released just over two weeks ago to critical raves and a few complaints regarding its slightly higher than "standard" price of $15. Despite Jonathan Blow, the creator of the game, having to defend the price for essentially a full week bracketing its release, Blow has now confirmed via his blog that his Braid will probably make back enough money to allow him to work on his next game. This is certainly great news, as Braid is one of the best games to be released on Xbox Live Arcade, or if you use Metacritic, the 8th best game to be released so far on the Xbox 360. Jonathan Blow certainly deserves the chance to follow up his brilliant effort, but something about his post regarding the success of his game actually revealed a warning sign to me for indie games overall.

In his post, Blow "hope[s] this will serve as a useful data point for other independent developers: we can make games that are unusual, experimental, or personal, and there's a substantial audience out there who will play and enjoy them." In a matter of a few days, Braid has become possibly one of the biggest success stories for indie development on the console platform. Blow hasn't revealed exactly how much Braid cost him to make, but he previously reported that the initial 28.5k he sold in the first few days was not sufficient and that he would need to sell "a lot more than that" for the game to be profitable. Summarizing Braid's first week of sales, Blow estimates that Braid sold about 55k copies, and yet also reveals that this, still, would not be enough (in itself) to allow him to work on his next game. He believes that eventually, however, it will sell enough copies to finance his next project. This is the part that troubles me.

At $15, 55,000 copies translates into $825,000 in revenue. According to a Gamasutra article, Braid was signed before the new XBLA royalty rates were put into effect, meaning that his team should be getting 70% of the revenue from Braid. As of now, that would be $577,500, which makes it a little surprising that the game is not profitable yet (or at least not enough to allow him to create his next game) since, as Blow admits, his team basically consisted of himself and his artist. The Wall Street Journal claims that he sunk $180k of his own money into the game, and over the course of its 3+ year development it likely required significantly more than that. For example, N+ cost $214k and 10-11 months to create. Kim Pallister, a game industry vet, suggests that it could have cost between $300-$400k and also points out a comment that Blow makes explaining some of his costs and motivations. In it, Blow says that breaking even essentially means "not being punished" for creating the game.

So, if we assume that the game took $400k to make and it has now made $577,500, that leaves $177,500, or, almost exactly what Blow had originally invested himself into Braid. Perhaps not wanting to deal with loans and being completely broke again through the development of his next game, Blow wants to essentially bank enough to fully support his next game. If Braid sold 100k copies it would net about $1M for the developers, $400k to pay back loans, another $400k to finance the next game, and a $200k "bonus" divided amongst the developers for over 3 years of work. Looked at in this way, this is certainly not an enormous yearly "salary", as Blow points out that he can get paid quite a bit as a consultant, but it would probably meet his definition of "not being punished."

If Braid is potentially on its way to hitting 100k sales or thereabouts, and therefore profitable enough for Blow to create his next game and also enjoy some profits, what exactly is the warning sign? To put it simply, the fact that it needs to sell around 100k copies at $15 to justify creating another game is a bad sign because many games simply don't sell that well. Braid is a game which received a bit of pre-launch buzz as well as excellent reviews once it was released. I hope Jonathan Blow doesn't take this the wrong way, but what if his next game isn't nearly as successful?

Game development is tough, and it's a testament to Blow's creativity and technical prowess that he was able to deliver a game as celebrated as Braid. But Blow, and other indie developers, are literally living from game to game. If one of them isn't well-received, it could very well go the way of Space Giraffe, and suddenly creating the next game might not be so easy. With Microsoft's new royalty program, financing the next game or just "breaking even" becomes even more difficult. I'm glad that indie developers have the ingenuity and passion to create these games, but I wonder how long it can last. I hope I'm proven wrong.

As co-editors of A Link To The Future, Geoff and Jeff like to discuss, among many other topics, the business aspects of gaming. Game companies often make decisions that on their face appear baffling, or even infuriating, to many gamers. Yet when you think hard about them from the company's perspective, many other decisions are eminently sensible, or at least appeared to be so based on the conditions at the time those choices were made. Our goal with this column is to start a conversation about just those topics. While neither Geoff nor Jeff are employed in the game industry, they do have professional backgrounds that are relevant to the discussion. More to the point, they don't claim to have all the answers -- but this is a conversation worth having. You can reach them at