Self-publishing keeps Double Fine solvent, Psychonauts finally making money

tim_schafer

By on March 2, 2014 at 7:07 am

Double Fine used to subscribe to the traditional industry business model of pitching games to publishers, then making just enough money to pay staff till the next successful pitch – a risky, stressful, low-return strategy.

Speaking to Kotaku, founder Tim Schafer said the company is free from that whirlwind now, having ensured a steady supply of funds by self-publishing – including regaining the rights to some of its back catalogue.

What’s interesting is that Double Fine, a champion of the Kickstarter revolution, isn’t dependent on crowd-funding – which, by the way, rarely earns enough to fund an entire game, even when it runs into the millions.

“The Kickstarter was obviously a huge new way of doing things, but the biggest change was going into self-publishing where all those games you were saying didn’t do well, they actually sold fine for someone who was doing self-publishing,” Schafer said.

“So now that we have the publishing rights for those games back, they make us a lot of money that we used to invest back into Broken Age.”

For example, Schafer said sales of Brütal Legend have helped fund Broken Age, and Psychonauts is now making more money than ever before.

“Psychonauts has been out so long and developed such a cult following that every time there’s a Steam sale it’s generating a bunch of money for us,” he said.

“The scale of those sales makes the most sense for a company of our size. It might not be a blip on the radar for a company like Microsoft or EA or a huge company like that, but, for us, it allows us to make a thriving business off of creative ideas and inspiration-driven development.

“We made more money off of Psychonauts in the last two years than we ever did before—mostly because we didn’t have the publishing rights.”

This is just one of the reasons why Schafer and his team patiently chase the rights to games from their histories, like those Schafer designed while at LucasArts, which Disney is keeping a tight hold of despite doing absolutely nothing with them.

Source: Kotaku

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6 comments (Leave your own)
lord-ezekiel

Good on them, they make some great games, psychonauts is still up there for having some of the most memorable and creative levels i have ever seen.

 

These days there really is getting less and less reason for big middle-men like EA to be there taking sometimes exorbitant cuts in the profit. Especially for studios making sub-AAA titles.

 

irritus,

Any source on that? EA barely discloses the partners program separately (also why do you call the sole publisher a ‘middle-man’? I understand someone like Namco Bandai who does publishing in certain regions) in their financial reports as it is so it’s hard to get any separate numbers for it. You also have to consider everything they’re paying for as well, plus the extra for having a substantial publishing network builtup over years of work (big enough that Valve publishes their games on console with them).

And for stuff not in their partners program it’s more of a ‘they are part of the EA consolidated entity so all NPATs are EAs and why are we talking about this’ situation.

Also, self-publishing risk is different to using a publisher. Using a publisher can lead to poor sales due to the brand being unknown (pretty much all Double Fine games before kickstarter but especially Psychonauts), whereas self-publishing completely eliminates risk unless your CFO gets their estimates way off.

 

Admitedly there was a certain amount of spit-balling going on when I said “exorbitant”, however I highly doubt it’s a small cut, especially when it can be the difference between making a profit and not in the case of a studio like double-fine. As to why I call EA a middleman, as far as I see it that is essentially what they are. What you have is essentially, the studio(doublefine) -> sells/licences to EA -> sells direct to customer or to brick and mortar stores. Where these days Studio -> Customer is a viable option, or through steam, where the licencing arrangements I’m sure, are more beneficial to the studio.

You’re right there are different risks, and in some cases you would need the startup capital of a company like EA, but I don’t really see the advantages being worth it for a company that can bankroll itself and is happy shipping solely digitally.

Then you get cases with publishers where a game’s rights are owned by them, and they choose to do nothing about it, even with the rather low price of offering a game as a digital sale, like GOG does.

 

rapid101,

Any source on that? The proof is in the pudding as they say. Developers aren’t making any money, publishers are using shabby tactics to try and force up income and meanwhile the industry is pumping out more half finished polished turds.

The real question is how the hell did the industry get in this position in the first place?

 

@ Irritus,

Your completely skipping over that publishers are completely responsible for all game advertising/marketing, which can end up being equivalent to the entire game development cost. They are taking a big cut because they’re paying a bug cut of the total development costs.

@ rapid101,

If the publisher does their job properly, and effectively markets a game, Putting an unknown game out with a Publisher will make more money as a result of effective advertising. If you self-publish, you have to do all that yourself, and for an unknown brand no one is going to buy it unless you spend just as much on advertising as the publisher does.

As far as I see it, the issue isn’t ‘publishers’ as a catch-all, but rather publishers who aren’t doing their job properly. Psychonauts sold terribly because it had one of the worst advertising campaigns in game history, and is basically a case study in how a game simply won’t sell with no advertising at all (until years later, when its a ‘cult hit’ – ie people buy it on word of mouth).

finally, Double Fine are not a self-publisher. They are having their games published by steam (who are doing all the advertising). Steam putting the game up on a sale IS advertising, and exactly what a traditional publisher should have been doing (the equivalent thereof). All that’s really happened is that Double Fine have changed publishers, to one that’s doing their job better. Claiming that everything wonderful is solely due to Double-Fine is typical Schafer spin. He should be thanking Valve for being such a wonderful ‘publisher’ for his company.

 
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