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Do we still need game publishers?

The video game industry is bigger than it has ever been. Industry analysts Superdata Research predict that this year the ‘Global Interactive Media Market’ will be worth $105 billion. Some of the biggest players in this market are the publishers. There are hundreds of video game publishers around the world. Some of these are titans of the industry (such as 2K, Activision, Bethesda, Electronic Arts, and Ubisoft), while most are small independent publishers. With developers now able to self-release on nearly all platforms, do we still need game publishers?

A couple of console generations ago, if you wanted to release a video game you needed a publisher. Digital releases were in their infancy, so you needed someone to arrange the manufacture and distribution of your title’s retail copies if you wanted to get your game out. Times have changed though. Nowadays, any independent developer can approach Apple, Microsoft, Nintendo, Sony, or Steam to release a game on their platforms. This has led to a thriving indie game scene where developers can create whatever they want and be able to release it into the hands of gamers all over the world.

Publishers themselves have realized that things have changed and are trying to adapt as AAA publishers have taken to buying up development studios. Think about the games that Electronic Arts have released over the last few years. With the exception of Titanfall 2 and Unravel, all of EA’s games have been made by studios that they own. The same can be said of Ubisoft and Activision (though Destiny is a notable exception). These AAA publishers are becoming/acquiring developers themselves and leaving behind the business of third-party publishing.

Meanwhile, a lot of indie developers have become glorified PR (Public Relations) agencies. A lot of these will take a game from a developer and charge considerable fees to take the game to public or industry events showing it off and publicizing it as well as taking a significant cut of the sales of the game. Yes, they arrange for the game to go on Nintendo’s eShop, PlayStation Network, Steam, and Xbox Live, but the developers themselves are able to do that now.

While looking into this, I spoke to some indie developers and heard real horror stories about them not receiving any revenue from the sales of their game. Publishers had charged so much for advertising the game, and that is the first money they recoup before the developer sees a penny. I have heard of developers having to pull their games back from publishers they trusted with their work. I was even told about developers that have been forced out of business by these practices, despite the games achieving solid sales.

Not all indie publishers are bad. I have heard good reports about a couple of them, but these are the minority rather than the majority. Indie publishers don’t help with the funding of a game (that’s strictly AAA publishers) and PR companies, distributors, and platform holders can provide the services these publishers offer. There really doesn’t seem to be any real need for indie publishers anymore.

Last week, Insomniac Games tweeted about the fact that they would love to make a sequel to Sunset Overdrive but would need a publisher. In this case, they need significant funding rather than someone to promote and distribute the game. It seems crazy that a major developer like Insomniac can’t find funding to make a sequel to a game that has a Metacritic score in the 80s. One avenue they could try is crowdfunding, but even the most successful Kickstarter campaign (Pebble Time) only raised $20 million and to develop a AAA open world game would require around twice that amount.

The biggest crowdfunding success in video games has to be Star Citizen. The ambitious title from Wing Commander creator Chris Roberts raised just over $2 million on Kickstarter but continued to crowdfund via its website. The game had raised over $100 million by the end of 2014, though a lot of that has come from backers buying in-game items. As big as a success as this is, it is an anomaly in the industry and has met a lot of criticism for the way that the game has aggressively chased funding while failing to meet deadlines and not keeping backers informed of progress.

The world of video game publishing has changed and continues to change as it tries to find its place in the ecosystem. Like I said earlier, AAA publishers have become more of a hub of developers that they own. The time of the powerful publisher may well be near an end, but could well be replaced by all-powerful companies that just devour all successful developers. Indie publishers, for the most part, are biting the hand that feeds them by ripping off the developers. As word gets around to developers about which indie publishers can be trusted, I think we will see a lot of them going out of business. This will hopefully leave the few respectable publishers to gain more power, and may even lead to them being able to help towards funding and become more useful to their developers. It’s an interesting time in the business with risks and rewards so high and developers having greater direct access to platforms. Here’s hoping that however it all pans it out, the decent, trustworthy companies get the success they’re due and the others get out of the business without taking too many good people with them.

Steve Clist
Joint Editor-in-Chief at our sister site XboxEnthusiast, Steve also has a serious love for Nintendo. His first console was an N64 and it was love at first sight. He may specialise in racing games but will give anything a shot. He's also a serious guitar player and musician. Basically, Steve rocks. Need we say more?

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