5 ms·

These are just symptoms - the fundamental underlying factor is the 30% commission taken by Valve, Microsoft, Sony, Apple, Google. Take these values down to 10-

These are just symptoms - the fundamental underlying factor is the 30% commission taken by Valve, Microsoft, Sony, Apple, Google. Take these values down to 10-15%, and the game development business becomes a lot higher-margin, encouraging new entrants and supporting better salaries and conditions for staff. The other problem is that games are unique that they are entirely B2C, retail products. As a result, the full taxation burden falls on them. Its not uncommon for developers to actually receive only 50% of spent revenue, after global sales taxes, platform commissions, refunds, chargebacks are taken into account. By contrast general IT companies - if providing B2B services (including advertising) - have a much lower commission and taxation burden.

Netcob 6y ago
With the exception of small indie developers, I'm too cynical to believe that the difference would end up benefiting the staff.
- ArkanExplorer 6y ago
  On Steam, larger developers are charged a 20% commission, whereas Indie developers are charged a 30% commission. https://www.gamesindustry.biz/articles/2018-12-03-indie-developers-are-unhappy-with-steams-new-revenue-sharing-tiers https://www.gamesindustry.biz/articles/2018-12-03-indie-deve... You are put at a fundamentally poorer economic position if you quit your AAA job and make Indie games and release them on Steam.
villasv 6y ago
And the evidence for that diagnostics is...? Got any reference that links margin to company culture? The few people I know from the mobile gaming industry tell me the margins are insanely high. They’d spend x on ads and get back 2~5x in microtransactions. Also development costs were even lower than marketing costs.
- ArkanExplorer 6y ago
  This is the conclusion of the American Federal Trade Commission... https://www.gamesindustry.biz/articles/2021-01-08-ftc-wary-of-apple-and-google-squeezing-developers https://www.gamesindustry.biz/articles/2021-01-08-ftc-wary-o... ""heavy taxation" by Apple and Google means developers are forced to use monetisation models that "rely on surveillance, manipulation and other harmful practices.""
  - shultays 6y ago
    Seems a stretch, publishing was costly pre steam as well and there were always a cut
    - deleted 6y ago
      [deleted]
  - villasv 6y ago
    This is a suggestion from someone from the FTC, not a study. It would be nicer to have data instead of opinion. For instance, PC games have microtransactions too. Many top-toxic companies are are mostly in the PC ecosystem and don’t have to pay to be on PC. Yet you still listed Microsoft as one of the companies squeezing developers.

Netcob 6y ago

With the exception of small indie developers, I'm too cynical to believe that the difference would end up benefiting the staff.

ArkanExplorer 6y ago
On Steam, larger developers are charged a 20% commission, whereas Indie developers are charged a 30% commission. https://www.gamesindustry.biz/articles/2018-12-03-indie-developers-are-unhappy-with-steams-new-revenue-sharing-tiers https://www.gamesindustry.biz/articles/2018-12-03-indie-deve... You are put at a fundamentally poorer economic position if you quit your AAA job and make Indie games and release them on Steam.

villasv 6y ago

And the evidence for that diagnostics is...? Got any reference that links margin to company culture? The few people I know from the mobile gaming industry tell me the margins are insanely high. They’d spend x on ads and get back 2~5x in microtransactions. Also development costs were even lower than marketing costs.

ArkanExplorer 6y ago
This is the conclusion of the American Federal Trade Commission... https://www.gamesindustry.biz/articles/2021-01-08-ftc-wary-of-apple-and-google-squeezing-developers https://www.gamesindustry.biz/articles/2021-01-08-ftc-wary-o... ""heavy taxation" by Apple and Google means developers are forced to use monetisation models that "rely on surveillance, manipulation and other harmful practices.""
- shultays 6y ago
  Seems a stretch, publishing was costly pre steam as well and there were always a cut
  - deleted 6y ago
    [deleted]
- villasv 6y ago
  This is a suggestion from someone from the FTC, not a study. It would be nicer to have data instead of opinion. For instance, PC games have microtransactions too. Many top-toxic companies are are mostly in the PC ecosystem and don’t have to pay to be on PC. Yet you still listed Microsoft as one of the companies squeezing developers.