Spot On: Studios bust as industry booms

The recent rash of independent-studio closures comes amid months of record-breaking retail sales; but what do billion-dollar revenues mean to someone who's lost their job?

Since January, a host of development studios have closed their doors, suspended operations, or otherwise stopped making games. Stormfront Studios, Perpetual Entertainment, Pseudo Interactive, Iron Lore Entertainment, and Castaway Entertainment have all hit the rocks in the last four months. Still-unconfirmed reports also have Activision's Foster City site, formerly Z-Axis, on the chopping block.

During that same period of time, the industry has racked up phenomenal sales. NPD's retail software-sales data for the US has been up by double-digit percentages for each of the first three months of the year, with growth of 47 percent and 63 percent in February and March, respectively. Meanwhile, Chart Track has reported its own record sales figures for the UK industry in the first quarter of the year.

All of this comes among heightened concerns of a recession in the US, highlighted by the collapse of securities firm Bear Stearns, record-high prices for crude oil, airline closures, and a depressed housing market. The gaming industry's stubborn refusal to stop making money hand over fist has led some industry analysts to portray gaming as a recession-resistant industry, with at least one going so far as to say that the industry can thrive on an economic downturn.

So how is the industry actually doing? If it's as great as the sales figures say, why isn't there enough money going around to keep independent studios in business? To get a fresh perspective, GameSpot bypassed the usual assortment of analysts and went straight to developers directly affected by closures to see if the situation looks any different from the inside.

Iron Lore made a Titan Quest expansion, but never had the chance to do a true sequel.

IRON LORE: On the Razor's Edge

Travis Doggett was an artist at Iron Lore from late 2005 until the studio's closure in February. He started off the year by finishing up work on the Soulstorm expansion for THQ's Warhammer 40,000: Dawn of War expansion pack. In the period between the game going gold and shipping to stores, Iron Lore management informed the staff that the studio would be closing after failed attempts to secure a follow-up project.

It wasn't the first studio that Doggett had survived. His first job out of art school was a two-year stint working for the famously excessive Ion Storm Dallas to finish up the long-in-development PC role-playing game Anachronox. Work on the game had barely wrapped up when parent company Eidos rewarded the team for its hard work by closing the studio.

"When Ion Storm shut down, it was awful," Doggett said. "We just took a two-week vacation to celebrate shipping Anachronox, which was a five-year project. On the last day of vacation, I got a voicemail saying they were shutting down the studio. That vacation we just took turned out to be our remaining vacation days."

Doggett's next job was at Atari-owned Legend Entertainment, which closed a little more than two years after he started working there, its last game being the special-edition release of Unreal II. One lesson Doggett said that he learned from seeing the three separate studios go under is that game developers can go out of business a million different ways, and it isn't always accompanied by a greater meaning.

"I don't notice the current rash of closings as being particularly noteworthy," Doggett said. "I mean, if I had everything on a chart, maybe it would give me pause, but it seems like business as usual. Studios are closing all the time. And they're opening all the time. It's volatile, sure, but it feels consistent."

However, Doggett said believing that the timing of these studios' deaths is an unfortunate coincidence doesn't take the sting out of losing one's job.

"It always hurts," Doggett said. "I know what those poor bastards are going through... I know what they've been through, those developers that got shut down. I know what it means to pour your heart out on a project, work really hard on something you want to be proud of, do nothing wrong, and still end up out on the street when it's all wrapped up."

As rough as it might be to wind up unemployed through no fault of one's own, it might be worse to have managed a dying studio and to know that its fate could have been avoided with a few different choices. Iron Lore's former president Jeff Goodsill never wanted to tell his staff that they were all out of work after Soulstorm was finished.

"It's very painful," Goodsill said. "You can't help but to feel responsible. And I do feel responsible for the people working so hard and not being able to have a better reward other than closing. The only relief I have is that we communicated throughout the process, and there was some bad luck."

The bad luck for Goodsill came when trying to pitch Iron Lore's next project, a role-playing game based on an original intellectual property. The studio spent a year trying to sell publishers on the game, with an estimated $20 million budget. Development on Soulstorm for THQ helped pay the bills for much of that stretch, but when that project ended, the cost of paying the salaries and operating costs of a 30-person development studio when there was no money coming in depleted the business's bank account in a hurry.

Soulstorm wound up being Iron Lore's swan song.

"You go from product to product, and you work on a razor's edge," Goodsill said. "You're always based on how your last product did, how profitable it was. Every studio's on a razor's edge, and it could go either way at almost any moment, really."

The problem with Iron Lore's proposed next project wasn't a lack of interest, Goodsill said. Although many of the major players were considering picking it up, consolidation in the industry was a recurring theme and an impeding force in negotiations. A publisher in the middle of the recent round of acquisitions and mergers will likely slow or stall negotiations until the dust settles. Things might not improve even after that because consolidation means that there are fewer companies to pitch projects to, and each of them has more internal studios that could be seen as competing for the same development dollars.

The mergers don't even have to be as big as Activision and Vivendi to cause problems. Goodsill believes that THQ's pickup of role-playing-game specialist Big Huge Games hurt Iron Lore in the long run because it meant that the publisher would likely already have products in development in a similar genre to that which was being pitched.

Problems like that prolonged the pitching process enough that Iron Lore could no longer afford to keep the lights on. When news of the studio's precarious position circulated in the industry, Goodsill was surprised at the interest and the business offers that came pouring in. With the benefit of hindsight, Goodsill said that he would change the way he handled some of those inquiries.

"We were dealing with at least 10 major publishers to get funding, and that was the only place we were looking," Goodsill said. "We should have been looking at different areas, not just for contract work, but for full products... I should have looked more at the existing development community for work. I didn't do that, and I think that was a mistake. In hindsight, if I did that, we might still be in business."

Whatever impact the economy and other external factors had on Iron Lore, Goodsill believes its fate could have been avoided, or at least delayed. One of the biggest expenses for small studios--and an attractive cost-cutting opportunity when backs are against the wall--is the cost of actually paying people to work for them.

"What some developers decide to do is lay off half their staff so they really slow down their burn rate well ahead of time," Goodsill said. "We didn't want to do that. We had spent seven years building a team, and we just didn't have the heart to lay off half the group and start again."

CASTAWAY: Spinning Djinn, driving Yaris

The practice of laying off employees in-between projects is a common one, according to Michael Scandizzo, president of Castaway Entertainment. One of the reasons that he and some fellow Blizzard veterans established the studio in the first place was to make sure that they wouldn't wind up on the wrong side of that equation.

Castaway started flying its white flag earlier this month after negotiations for a pair of projects fell through. In one case, the potential publisher decided to go with one of its internal studios for the project. The other involved a company in the middle of the industry's latest round of acquisitions.

"With the mergers happening, it slowed down operations at some of the studios," Scandizzo said. "They're not sure if they're coming or going, if they're signing or if they're laying off, so they've been very slow to move on projects. That pretty much ties up most of the major publishers right now."

Castaway's Djinn was clearly along the same lines as the development team's previous franchise, Diablo.

The dangers of living from project to project were well known to Castaway, and Scandizzo said that the team was always looking to bolster its bottom line with a backup project.

"We were trying always to get a second one going, but it's so much harder to get a second one functioning, particularly because everyone always wants the top talent working on their project," Scandizzo said.

One such project, the free Xbox Live Arcade advergame Yaris, was originally intended to be such a secondary project. However, negotiations dragged on for a year due to the difficulties of having to get five different parties in agreement. By the time it was actually green-lit, it was the only game on the studio's slate.

Castaway also tried to get work in porting games, but found the number of different platforms and different demands from publishers prohibitive. Coming from a PC background, Scandizzo said he was told that everyone was developing for the Xbox 360, so they purchased expensive dev kits and learned Xbox 360 development. Then publishers were telling him that most projects were starting on the Xbox 360 and the port work would be to the PlayStation 3. Then the breakthrough casual-gamer success of Nintendo shifted the porting focus to the Wii and the DS.

Castaway's fate may have been sealed before those troubles even began. The company's biggest project, Djinn, was originally planned as a $10 million budget action RPG in the vein of the Diablo series (on which many Castaway employees had worked). One of the companies that Castaway pitched Djinn to was THQ, which had just weeks prior entered into discussions with Iron Lore to produce that studio's own action RPG, Titan Quest.

Titan Quest and Djinn were both pitched to THQ around the same time.

THQ went with Titan Quest, and Iron Lore was off and running with a development mindset of making AAA releases and never compromising on quality. The longer that Djinn remained in development, the clearer it became that the game would not be finished. Scandizzo said that publishers grew more fickle with the projects they would fund, so Castaway adapted by lowering its sights.

"Iron Lore in some ways is like the path not chosen for us," Scandizzo said. "Titan Quest is the opportunity we could have had. That's what we might have ended up like, and instead we wound up choosing the cheaper, low-end projects. And what's almost amusing to me is that we both ended up shutting down at about the same time. I'm not sure what to take out of that other than I can't feel like we did anything tremendously wrong."

In many ways, the industry today just doesn't add up for Scandizzo. He doesn't understand why publishers don't seem more threatened by digital downloading on the consoles, which could cut them out of the purchasing equation. Why is there seemingly no market on handhelds or consoles for massively multiplayer games? Why are people still talking about microtransaction business models but releasing only monthly subscription games?

"Right now I'm scratching my head about a lot of stuff in the industry," Scandizzo said. "It's like the industry doesn't know where it's going, what platform it's traveling on, what it's doing... There seems to be a lot of chaos, and that trickles down to not a lot of coherent work for us on the bottom of the food chain."

Scandizzo's story doesn't have a happy ending just yet, but there is still some hope for Castaway to receive a pardon at the 11th hour. After he first put out the call for help, interested parties started reaching out, and Scandizzo is currently in talks that could see the studio resume operations.

"There is at least a chance at this point that we could survive in some form, but it looks very much like it will not be as an independent studio," Scandizzo said, suggesting that an acquisition could be in the cards. "The loyalty of the team has been so extreme that we've been trying everything we can to stay together, even at great personal financial cost."

WIDELOAD: On dodging bullets

Some of these problems have been visible for years. Bungie Studios founder Alex Seropian knew that there were issues with the model when he left the development house behind the wildly successful Halo series.

"You would always start a project off with just a handful of people because there's not enough to do for 100 people and you wanted to put all those creative decisions in the hands of not too big a team," Seropian said. "Then as you get into production, you ramp up to 50 or more people. Then that transition period from the end of an old project to the beginning of a new project would put a lot of people out of business because they'd have this big payroll."

It was a pitfall that even developers who planned around the gap between projects could fall prey to. Seropian recalled seeing a number of studios in that predicament specifically because of their publishing partners.

"Sometimes they asked developers to do things they weren't sure of, and the developer ends up taking that advice," Seropian said. "Then the project takes too long or it doesn't make the publisher happy enough, and the project goes away. But when a project gets canceled at a small developer, they still have that big headcount. And that put a lot of companies out of business too."

Seropian believed that indie developers trying to use that model were all but destined to fail, so he designed his new studio, Wideload Games, around a business model that outsourced talent wherever possible. A small group of full-time employees handle the key creative decisions and enlist the help of skilled freelancers to do the gaming equivalent of grunt work.

The Wideload approach has paid off so far with Stubbs the Zombie under its belt, the upcoming Hail to the Chimp set to be published next month by Gamecock, and an optimistic outlook on the industry despite the outside economy.

To paraphrase Wideload: It's not the economy, stupid.

"We were just out visiting publishers last week and they were aggressively looking for new stuff, so it's tough to see an impact right now," Seropian said of recent economic concerns. "Maybe some projects have been canceled along the way, but it doesn't seem to me like that was because of the economy."

Wideload president Thomas Kang has a more financially focused background specializing in mergers and acquisitions in the oil industry, and he thinks that the gaming business should actually benefit from economic downturns.

"Entertainment as part of discretionary income is more or less not elastic," Kang said. "It stays relatively steady regardless of economic forces. As a matter of fact, if you're unhappy because of some economic forces, you'd be looking for entertainment more."

As Seropian explained, "If you get laid off from work, what are you gonna do? You're gonna play video games all day."

IGDA: It's a seller's market

As head of the International Game Developers Association, Jason Della Rocca should be as in tune with the plight of the independent developer as anyone. But even he sees the health of the economy (or lack thereof) as a probable nonissue for the industry.

"If we're booming and loaded with cash and disposable income, then buying that cool HDTV and my [$400 PS3] and all the latest whizz-bang games seems like an obvious thing to do," Della Rocca said. "Conversely, if it's a bust and we're not rolling in money, chances are you'd save the money on higher ticket expenses like a vacation to Australia, going to the Caribbean, buying a new car. Compared to that, popping $50 for an Xbox game doesn't seem like that much."

Even the practice of pairing a pink slip with a game going gold seems to leave Della Rocca unfazed. According to the trade-group head, the practice has been in wide-enough use for long enough that many creators just started to plan around it.

"As a developer, you were pretty comfortable that as you got canned from one company because the project was winding down, you knew that there was someone else in town that was ramping up," Della Rocca said. "You got fired at the end of every project anyway, so it was kind of a joke to begin with that you were actually 'full-time staff.'"

Due to the consolidation trend, Della Rocca said that the practice has been in decline in recent years. A publisher such as EA or Ubisoft always has projects just starting to ramp up in development, and so would be more likely to shift people between studios than to fire them outright. And even when it does happen, the situation isn't always dire for the people impacted.

"The reality is it's a seller's market from a talent point of view," Della Rocca said. "If you have talent, you know there are dozens of companies that are going to pick you up. And if you just shipped a game, you're that much more desirable and in demand."

Della Rocca says it's a seller's market, and that IGDA chapters are an ideal way to network your way to a new job.

That was the case for Doggett. The developer has started his new job at Boston-based 38 Studios, the massively multiplayer online role-playing game maker that's actually headquartered in the same building complex as Iron Lore. Rather than turning bitter or getting burned out on the industry after having three studios die underneath him--each after more than two years of faithful service--Doggett isn't letting it affect his work ethic in the slightest.

"Really, I believe in the studio I work for," Doggett explained. "Whatever happens in two and a half years, they're still feeding me now. They took a chance hiring me, and I respect that and wish to honor that with the best work I can provide."

Goodsill and many ex-Iron Lore staffers have been similarly fortunate. The studio's ex-president has already secured funding for an as-yet-unannounced Boston-based startup that will work on online games, and he said that all but a handful of his employees from Iron Lore have landed new jobs throughout the industry since the demise of their former employer.

"We joke that it's Star Wars and Darth Vader just killed Obi-Wan Kenobi, so now his Force is spread throughout the universe," Goodsill said.

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Discussion

101 comments
kompassssss
kompassssss

poor iron llore people its hard when u lose the job and i like titan quest

Crush_Project
Crush_Project

hilarious to me that in the 90's there were very few large companies making games, but the games they pumped out had more content, were better polished, and had bigger followings just to name a few bonus's. Now what do we have? graphics? i was happy on the old pixel games... If you look at the music industry its the exact same way. A genre is only good until the bigwigs get their hands on it and squash the crap out of it until you have nothing but cookie cutter products that no one wants. I hate to think what games are going to be like in another 10 years.

thenephariouson
thenephariouson

delta3074, Remember 'Knight Lore', what an ingenious game! Shame most devs nowadays are not as imaginative, its simply a case of sub-parr FPS's etc. Those were the days : )

studnothin
studnothin

it really is unfortunate, the lack of creative growth this medium has due to the large, overpowering corporate influence. it should be a partnership, but instead you see these large, overbloated companies--as someone else put it--lording over independent ideas just to capitalize on the net worth. the direction and influence of this industry is just another classic case of the tail wagging the dog. we need to find a way to give the power back to the real creative influences, before every smuck with an MBA finds more justification to bleed this rock dry. it really is getting ridiculous.

d3vilg0d
d3vilg0d

Big corparates turning down independent smaller companies for internal companies is normal business practice.The differnece between giving an internal and external co. funding comes down to profits.internal you have big profits with smaller losses.

Sagacious_Tien
Sagacious_Tien

There is a lot of ways to make money in the gaming industry now, but it is also high risk. There seems to be a lot of confusion about what kind of business models can support what. Even doing your best isn't good enough now - top games still go unnoticed. :(

dryden555
dryden555

What this article doesnt say is that great games are made by talented skilled programmers and not "managers." And it is the programmers who are given the pink slips when a game is completed and the core "managers" stick around looking for another publishing deal. No wonder these smaller game companies keep failing. The business model cannot sustain itself. Carmack is a good example of someone with technical skills who can also make business decisions and that is why he is still around.

delta3074
delta3074

what happened after 1983 had a lot to do with mastertronic i had my first speccy 48 and mastertronic were making games that were almost if not as good as the more expensive games and they made loads of them it cost between £10-15 pounds for a full price title and only £2.99 for a mastertronic game so really good small developers like hewson and thalamus who made some of the best games like uridium and hawkeye went under cos people would rather go out and buy 3 mastertronic games instead of a full price titles i chuckle to myself when i think about the graphics and how i thought last ninja 3 had the ultimate graphics back then things have seriously moved on but although the graphics are way better these days every game felt special back in those days cos they didn't just churn out loads of rubbish like EA

living_wmd_888
living_wmd_888

This is what happens if we keep supporting the two bloated monoliths of the industry - EA and Activision. This generation, most of the big games on all three systems have been first-party games. You know that once the tide of profit from GTA IV subsides, Take-2's owners are going to sell out to EA. Sega does not need to be back in hardware. It nearly bankrupted them before, when they only had Nintendo and Sony to compete against. How do you expect them to be able to compete against Sony, a Nintendo that is several times the size it was when Sega was still a hardware maker, AND Microsoft??? Looks like a fast but ugly suicide to me. Sega won't be that stupid.

nate1222
nate1222

@ LindBergh2007 As far as "lessons" go, I think Nintendo has already learned theirs during the N64 and GameCube eras. Those definately caused them to create the Wii. And maybe the Saturn and Dreamcast (though Dreamcast was awesome) will drive SEGA toward something very similar. If they can keep it around $300, give it Flash mem and support SD or thumb drives and feature downloads (cheap ones)...We could see a major comeback from SEGA. Hell, they can stick with the Dreacast controllers and allow Dreamcast games to play on it. Emulators, small-tech companies pressing copies of DC games (and giving SEGA and the devs/publishers their cuts). It can happen.

LindBergh2007
LindBergh2007

Nate1222, I agree with you. That is likely because SEGA's consoles have tended to always be based on arcade boards.(Dreamcast was based on Naomi,Saturn on Model S-VT) Sega's arcade technology has always been inexpensive. I believe Sega' next console will probably be about $300 or $350 especially if it's based off of Lindbergh. The machine would probably run on two processors instead of one, due to the fact that's it's based on 2005 PC techonology. But if it runs on HD-DVD format, development costs would make it less costly then 360 and PS3. the machine would probably be sold like the defunct Web-TV as a 256-bit PC game console. Sega would probably have a built-in emulator inside it's console since there are alot of emulators that are widly availble.

nate1222
nate1222

If SEGA makes a come back, I'm hoping they take Nintendo's approach on price. I'd love to see 'box sets' of old Dreamcast games and tons of cheap 'downloadable' games from Genisis, Saturn and older Arcades. Like Nintendo, SEGA is sitting on a stockpile of Old School stuff at their disposal. The Wii is the ONLY next-gen console I want. But SEGA just might change that.....

LindBergh2007
LindBergh2007

Hmmm.......What does this sound like like? It sounds like 1983! that year the exact same talking points were used in discriblng the closer of over three dozen developers, Interesting enough, this generation much like in 1983 hasn't been about racing to the finish in inproving technology, it's been about trying to monopolize the software market and building the game industry into a multi-media medium, which I believe is hurting the industry and will eventually cause the market to be weighed down by it's own success. Much like in '83 when anyists were predicting that the industry was going to grow at an alarming rate in just three years, but at that time there was an oversaturation of games, too much demand for software and consistant ports of the same titles for a different platformer. People can argue about the Wii and fanboys can come up with all kinds of talking points, but it's obvious why it's been sucessful: the budget. That's the only reason why. Both the price tag and the last gen technology it's based off of have made it more a desirable purchase than 360 and PS3. We already know the $250 is why Nintendo has been able to get away with Wii and there's no reason to argue it. Though you tout Nintendo's success and fanboys can boast as much as they want to, the company itself is not optimistic about it's own future. Most sources and Japanese pundits say that Wii is Nintendo's final home console and that Nintendo currently has no plans to build another console(henceforth why the price won't decrease) Most people in Japan believe that Nintendo is about to leave the home console market and will shift it's focus on becoming a sole handheld maker. there are patents from Nintendo that point to another handheld in development. with Mircosoft, there are already plans for Xbox 3. Xbox 3 and Sega Lindbergh/Dreamcast 2 are both the only speculated next-gen console projects in the works. Meaning that no body is looking at the next gen, instead everyone is focused on getting thier own games out but the market has become too competitve for that. Which worrys me because when the software gets way too competive this could be a bad sign for industry that a possible severe decline may be headed around the corner, As for Sony, there are no plans for PS4, they spent over a billion dollars over a four year period to develop PS3. In Japan, thy believe Sony is considering competing against Sega in the arcade market and will build add-ons for other consoles. What i'm saying is that its obvious that everyone trying to paint a rosy picure of the market when there's trouble ahead. Growth of an medium can also be bad sign too,you can;t get too overconfident that everything's going to be okay. There's a time for everything, And if 1984 repeats itself and another crash occurs they it's for the good and will help companies change thier ways and techonlogy. And snakes3425, you made an excellent point. The Reccession isn't going to affect the industry that probably because people still focus on entertainment even when thier economic future looks grim. But that's not to say that a company doesn't get weighed down by it's own success. In the 1930s, MGM was the biggest hollywood studio in the world, just 3 decades later they almost went under. If E.A. continues it monopolizing they probably may end up the same way. And as for what Atari(R.I.P.) and Sega(They'll be back because they're still alive and well) learned, it's funny that a few others haven't learned that lesson so who's to say Nintendo and EA may not have to learn it in a few years?

nate1222
nate1222

@snake3425 Agreed. There's NO such thing as a "reccession-proof" industry. And it's funny how arrogant nerds/neo-cons continue to petend that gaming is immune. I'm 32. I've been a gamer since the NES 8bit era. Hell, I've been playing games since the Atari 2600. And I've been paring back signifigantly on my purchases, gaming and other-wise. My hours are shorter at work, boss is bsing around regarding raises (I'm up for one-been at this co. for 13 mo.), other businesses aren't hiring for more than 15 hours a week. Things are tough out here in the 'grown-up' world. At this point, I'm holding on to my PS2 and GameCube and I refuse to upgrade my PC. It's just TOO DAMN expensive. In another month or so, I might wind up ditching my DSL access and getting a pre-paid cell phone.

felshs
felshs

somehow , i knew this will happen. I alway wanted to be a game designer since middle school, i`m like the best drawer in school. fantasy type of person fill with ideas and creativity. But i gave up on that since high school, cuz i alway analyst what will be my future field. Competitive, unstable, and like they said "razer`s edge" job is not what wanna have" THINK TWICE BEFORE FOLLOW YOUR PASSION.

jknight5422
jknight5422

What's new here? Game companies have been going out of business all through the 90's...Very few last after the first game or two get out the door. Yaris was a horrible abomination of a game & a company should crash & burn after producing something so awful. Lastly, you have EA's monopoly building up & this will also kill the small game design companies. It doesn't seem to matter what people sell, there is always some a-hole that wants to lord over it, after they just got an MBA & read a book by Sam Walton about the Wal-Mart empire.

KSigMTSU
KSigMTSU

The economy is not tanking, but we have entered a new sort of guilded age where large money companies force other smaller competitors out of the market, or buy them up, in the name of corporate profits. It will eventually back off when the market regains some footing toward regulation of industries and their push against the sherman anti-trust act. If the government was doing their job, we'd have more than 1 cable company, 1 phone company, 3 cell phone providers, et. al. in each town. Electronic Arts is doing a lot of this damage to the industry by their acquisitions of smaller companies and pressuring out other companys from the market. Exclusive contractual agreements cost less than development of a superior product against competition. It is a shame that our government in the United States has been convinced by the corporate lobby that the way to succeed in the global economy is to allow domestic monolopies, and because of this they no longer enforce anti-trust law. Until this self corrects, expect closures and firings all over every industry as larger corporations take over small companies.

burnttoastman06
burnttoastman06

The fate that many independent developers face really is a shame. Now more than ever, the gaming industry is going through a lot of turmoil, and only the fittest (and by fittest I mean richest) survive. And since every game nowadays must be nothing short of a masterpiece in order to sell, a lot of pressure is put on the independent dev teams. Moreover, large developers are usually the only ones capable of pulling off such a feat; which is heartbreaking because independent teams create some of the most unique, imaginative, and fun games on the market. Additionally, even great games that have been made by independent developers often slip under the radar simply because they don't have the extra money to advertise, or gamers overlook them because the team is unknown... It really is an unfortunate truth - Clover, the developer of the original PS2 version of Okami, suffered this fate. The gaming industry has become a cruel, unforgiving place as its lust for money has driven it to insanity. However, we gamers must take part of the blame as well; we are too stubborn and jaded to spend money on unknown games and thereby help those who need it most - independent developers. And while none of us can affect the attitude and personality of the gaming industry, all of us can affect to whom we give our money. Hopefully we wise up and the industry calms down quickly - I don't want to see any more jobs on the chopping block.

BetterThanLife
BetterThanLife

Keep saying the economy is tanking and it will.. stadiums are still full, games of all things enjoy record sales, if people were that pinched for cash, I don't think they'd be buying games in record numbers. Housing is down, and that's about it calm down, it'll rebound, companies close every single day, but more will open up, that is called competition and free-market economics, there is no room for crying, **** or moaning about it. If your really starving and having a rough time, stop buying games and tv's and turn off the cable and goto college.

mysterylobster
mysterylobster

Instead of focusing on how many studios closed in the midst of a booming industry, how about finding out how many were started? I see nothing unusual about some studios closing while the industry is making tons of money. Nobody is entitled to a portion of the success; it still comes down to running a good business and convincing gamers to play your games.

Avenger1324
Avenger1324

The games industry is very fickle, but perhaps more so at the larger companies than the small independents. As soon as a project ends, large companies sack large numbers of employees that were brought on throughout the project to finish it off. It doesn't seem to matter how good you were at your job, or how long you have been there - when the project ends you all get sacked apart from a small core team. This is why many independent companies form - in the wake of mass-sackings from larger companies. They try to stick together and not do the same things they disliked in their former companies, but unless they have some luck, end up folding within a few years and 1 or 2 games. I never realised that TQ and Djinn were both pitched to THQ, and I suppose it is a bit dismal for Castaway to realise that even if they had successfully pitched Djinn, they may just have gone the way or Iron Lore.

HiResDes
HiResDes

Good Read, one of GS's best posts in a long while...This is the kind of coverage that keeps me here.

andrew_ribbons
andrew_ribbons

Soulstorm wasn't a pinch compared to the DoW games developed by Relic itself.

Dr_Lucifer
Dr_Lucifer

ive never played a game developed by one of these studios!!!

Spincut
Spincut

wow that was a long article, anyway, while these articles tend to be depressing, as a recent well qualified college grad whose life is somewhat on hold and his momentum fizzled, i cant help but at least feel a little heartened that i'm not that much of a screwup on the job hunt, things are just that bad. furthermore though, most of these companies dont strike me as big deals, what i mean is i didnt read about any of their closures and go "oh no! what ever will i do without their fine products!!". That being said it is depressing to see these kinds of problems, and am annoyed that i have to be in such a crucial stage of my life during it, as i dont feel as if there's a worser time....perhaps had it been just after i made some huge investment i suppose, but had i just graduated a little later or a bit earlier i would at least be likely securely employed by now and could ride it out. oh well....

pukmok
pukmok

Hey recessions are good for me! I got a cheap tv and get to laugh at idiots who mortgaged their house to buy another to sell at a higher price. Seriously its like putting your house as a bet on a roulette table. It was that risky because you didnt know when the market would crash.

Karkanof-Ops
Karkanof-Ops

http://seapowers.com/register.php?ref=1383 Go here and sing up for a free browser-based game! WOOT! And after that little plug-in here are my thoughts: There isn't a resecsion proof industry, at least not exactly. The video game industry will slow as like any other, but a full economic recession will not afect it as others. A great point is movies during the great depresion. People went and watched to get away from life, like puing it on pause and forget. Now we may not be in that extreme of a case nethertheless, all industries will be affected it just that video games will only slow but still continue to grow. There are some things money is always spent on.

Hedfix
Hedfix

snakes3425 'There's no such thing as a recesson proof industry, the Video Game Industry crashed once before' ---------------------------- That was because the market was flooded by Atari who kept doubling their output of game units year upon year without checking if the market for that number of games existed.

snakes3425
snakes3425

There's no such thing as a recesson proof industry, the Video Game Industry crashed once before. People are buying video games the same way people during the Great Depression and World War II went to movies and bought comic books, it takes your mind off of your problems. Independent devlopers need to remember that Video Games are as much art as they are buisness you churn out and over hype games that are of poor quaility you're going to lose your customers and you go under. Even mainstream companies, like Sega and Atari made that mistake.

Snakefan11
Snakefan11

we need independent developers as well as mainstream ones to prevent stagnation, you know?

William12123
William12123

I guess it's not as much that the industry is recession-proof, but more that whatever is popular will thrive. During the great depression, people bought comic books in droves to help ''escape from reality''. Although the situation isnt nearly as bad, it is a good case for the video games industry's invulnerability towards a recession; what better way is there to escape the insecurity of reality than video games? But indie developers work on a more specialized product, and rarelly exist to provide to the masses of gamers. Nintendo, EA, etc... make record profits because of the fact that they make stuff for everybody, and specialized games become more of a luxury. Thats just my opinion though, dont take it to seriously (historical facts are accurate, though).

thenephariouson
thenephariouson

foxhound_fox "I really wish there was some way of protecting the indie developers and their unique ideas." Thats why MS developed XNA.

foxhound_fox
foxhound_fox

I really wish there was some way of protecting the indie developers and their unique ideas. It is so sad to see them defeated by companies like EA who for the most part just release updated version of older games while indie developers release unique games and get shut down because they couldn't bring enough profit for their publisher.

Mush_Mouth
Mush_Mouth

I totally agree with grigjd3...if anything, games have become more complex. Nothing from the past 15 years of pc gaming can come close in complexity to games like Bioshock or Oblivion or Mass Effect or dozens of other titles released in the past 5 years. as it stands, it seems like the only complex games coming out anymore for pcs are mmorpgs and strategy/sim games. games that continue to change the industry are being developed for consoles now; nothing industry-changing can be pc exclusive anymore seeing as how consoles can do everything game-wise that pcs can, and usually do it better, with few problems.

grigjd3
grigjd3

(In reference to World69Star69) Hmm, I thought these "dumbed down" games like Mass Effect and Oblivion were pretty good. On the other hand, while I very much enjoyed Icewind Dale and Baldur's Gate, that whole system seemed to be getting old by the time Neverwinter Nights came out. I mean, there is only so much third person bird's eye view rpgs that one can take before one realizes that the developers have just gotten plain lazy. Also, if one likes Mass Effect, they might have to credit the 360 as the starting point for a great rpg that is going to pc. That clearly can't be true though because the xbox is destroying pc gaming...

thenephariouson
thenephariouson

Its all simply a matter of Supply & Demand! Where we (gamers) 'Demand', if they dont 'Supply' (to our standards) it doesnt sell!!! Its that simple really!!

Mush_Mouth
Mush_Mouth

Let's not avoid the fact that if devs made something better than Yaris, they'd have a better chance of staying in business. world69star69: your rant is totally unfounded and copmletely ignorant - the xbox is hardly the problem with pc gaming. if anything consoles in general have brought about a much easier way for devs to make games, seeing as how they're using development kits provided to them by the big 3, and they don't have to try and develop around people's different types of computers and operating systems and video cards and internet connections and hard drive spaces and whatnot. you obviously forgot this when you decided to rip on the xbox...don't forget that consoles have been made since '78 or '79 so don't act like the one single stupid console is the downfall of pcs. even if it was, what does that say about how weak and fragile the success of pc gaming is, anyways? furthermore, logically speaking, there are lots of types of games that just play better on consoles. I love pc games and I really miss the days of lucasarts' adventure games, but the better games are going to go where they're more easily developed.

thenephariouson
thenephariouson

world69star69, that was a truly profound & great moan! It also seems that you have not only highlighted YOUR issue, but are also aware of its solution, therefore could i be so bold as to advise you to get a 360?? this may help in taking the pain away lol : ) It also really ammuses me that just because theres a lull in the game genre's YOU LIKE that this is why some companies are going under LOL

world69star69
world69star69

The xbox is the problem! Publishers' nowadays just want to target the stupid halo type fans, or mainstream non gamers. It pisses me off! I was so mad, sad, pissed off..reading this article! PC gamers have been in wait for new RPGs for a while, one trickles in ever so often, but when you compare today with that of 8 years ago or before, when we used to get a few rpgs every year, it was a much better time for gaming! Publishers don't seem to remember 2000 when Blizzard released Diablo 2, Black Isle released Icewind Dale, Bioware released, Baulder's Gate 2, Ion Storm released Deus EX1, and probably more that I can't recall, and all of those games sold incredibly well, hell d2 sold over a million copies its first few days on market. Yet where is are diablo3's are Baulder's gate 3s or are new roleplaying games for the pc? After hearing that two of the companies where going to make PC rpgs and both got taken out of business, it is a sad world. There is a huge demand for this type of game! Not everyone wants an mmo, or a console game. Xbox was/is the death of great games, when publishers want devs to publish for the xbox first, games get dumbed down, and the audience changes. We would never of had any of the classic rpgs for pc, if they targeted the xbox first. microsoft ruined a big chunk of pc gaming, and it kills me as i don't like consoles. Yes I have a wii, but that is only for party games, and my girlfriend. I barley ever play it. I enjoy pc games as I have a great gaming rig and a huge 24" screen to game on.

DJ_Quack_Quack
DJ_Quack_Quack

cyw1988. What you said is true, but Blizzard is exception because they made so much money from their warcraft 1, 2 and 3 as well as Starcraft. Plus, once world of warcraft came out, they were practically printing their own money. They had so much money they could take their time with starcraft 2 for another decade.

cyw1988
cyw1988

I agree with you ItsBriskBaby... You want to survive in the gaming industry, make a good game simple as that. Graphics don't have to be top of the line just need to be of a certain standard(industry standard) but gameplay and story have to be well developed. IMO, take a good rest after a big project. Don't jump into a sequel or follow up immediately unless really you're a workaholic and have a good idea of what to do. Take a look at Blizzard. How long did they take to produce star craft 2? Nearly a decade. Like I said, take a break so that the mind is given a chance to rest. A fresh mind comes up with good things.

ItsBriskBaby
ItsBriskBaby

I put it to you plain and simple....Foul games get no money while great games get money and keep the Devs in business. It doesn't take an genius to figure that one out.

nate1222
nate1222

@those who think "quality" always sells Not all the time. Dark Cloud 2 on PS2 rocked hard and didn't fly off the shelves. Halo 3 was slickly produced and highly predictable. As are several other games right now. One of the main problems is the 'mega-publishers'. These guys will often REFUSE to green light anything but an established (read:redundant) genre. Then, after the dev has poured time and payroll costs into the product, they'll either scrap it or half-ass market it. Note: they usually "half-ass market" it when it takes risks. Look at what EA pulled with 'Time Splitters Future Perfect'. The publisher and the console maker each get a cut per copy sold. And if it doesn't sell enough copies to pay back the development costs, out of what's left for the devs, the dev is BROKE and in DEPT. Thus, repetitive FPSs, urban (stereotypical) combat and shallow RPGs are what floods the shelves. Meanwhile, risk takers and even a few who "play along" with the publishers wishes lose their asses. The gaming industry is going to go bust in a couple of years. Console gaming won't "die", but it's going to cool off signifigantly. Mark my words, fan boys.

Gladestone1
Gladestone1

What i find sad is...Man a ton of titles couldve been developed..Than fell short cause of expectations.. Some of yall may hate ea..Well not some but most of yall..How ever look at ea..It ends a project and begins a new one..They keep people at work..How ever they do a lot of stupid stuff also.. Like the spore stuff selling some thing for 10 bucks, when it should be free is rediculas...That said i guess its there way of saying this cost a ton...So we need to have some money come in for it.. Its sad though that there should be, more small time dev teams out there..Relying on one project to exist is nonesence..Its like my family relyin on paycheck to paycheck..Thats why we put cash in the bank , for future problems.. Now though we can see, why these other companies..Are buying the other smaller studios...Instead of us crying foul..Maybe we should celebrate that ea is keeping a company alive..Or valve is keeping another company from closing.. Except when you do what ea has done recently..Try an buy a company through the back door..When take two doesnt want to sell..That was just wrong what ea did.. Im sure ea will take a lot of slack for it though..Im hoping it does learn small lessens..Dont buy that 10 dollar editor..Say no, as consumers we must stop things some place...Also say no to ea for trying to take over take two..

thee_Decider
thee_Decider

Gaming IS recession-proof. Pasted from an article in today's New York Times about consumer belt-tightening... "In a survey conducted this month by the NPD Group, a research firm, consumers suggested that they would sooner cut spending on clothing, furniture and eating out than on video games." Describes me to a T.

thenephariouson
thenephariouson

This is one of of the reasons MS created the XNA, which will allow small private games makers to go 'Big Time' as MS know that this is a potentially un-tapped recource. Do you see any other manufacturer doing this?? I think not!!!

Deiuos
Deiuos

As the expenses go up for development of these newer consoles, more studios will fall prey under economic difficulties. This is going to be an on-going trend until something gives a better path for indie developers -- and that path, I believe, will be related to downloadable content. We'll see.