Why Gears of War costs $60
by Brandon Pollet · 12/20/2006 (3:01 pm) · 30 comments
This is an interesting breakdown, from Forbes originally, of why next-gen games cost $60 bucks a pop. I thought it might be of interest to the crowd.
-* From 1up.com *-
Here's the skinny, as far as Forbes' article breaks it down:
ON A $60 GAME OF GEARS:
* 25% (aka $15) goes to pay the art and design guys.
* 20% ($12) goes to pay the programmers and the engineers.
* 20% (also $12) goes to your friendly neighborhood retailer. EB / GameStop, whoever.
* 11.5% ($7) goes to a "Console Owner Fee" - ie. whichever one of the Big Boys made your hardware (Sony, MS, Nintendo.)
* 7% ($4) goes to marketing, and puts Mad World and Marcus Fenix on MTV.
* 5% ($3) goes to "market development" -- paying for cardboard Standees of the Gears Crew and elbowing other games out of the way for shelf space at your local retailer.
* 5% ($3) goes to actually manufacturing and packaging the disc.
* 5% ($3) is spent paying the Man for IP licenses or maybe hiring some big name voice actors. If your game isn't an original IP, here's where you get dinged by Marvel, Disney, or Ray Liotta's agent.
* 1.5% (just $1) goes into the publisher's pocket.
* 1.5% (also $1) goes into the distributor's pocket.
* 0.3% (about 20 cents) goes into corporate costs. Management, overhead, lawyers, etc.
* 0.05% (less than 3 cents) go into the cost of paying for the Developer's Hardware. Who knew an SDKs can cost tens of thousands of dollars?
And there you go. $60 of Gears, a la carte.
I think it's interesting that the Art guys take a larger cut than the programmers, but that also factors in Cliffy B's cut and I'm sure he gets a sizeable one ;)
And here's my picture... since we have to have one!
-* From 1up.com *-
Here's the skinny, as far as Forbes' article breaks it down:
ON A $60 GAME OF GEARS:
* 25% (aka $15) goes to pay the art and design guys.
* 20% ($12) goes to pay the programmers and the engineers.
* 20% (also $12) goes to your friendly neighborhood retailer. EB / GameStop, whoever.
* 11.5% ($7) goes to a "Console Owner Fee" - ie. whichever one of the Big Boys made your hardware (Sony, MS, Nintendo.)
* 7% ($4) goes to marketing, and puts Mad World and Marcus Fenix on MTV.
* 5% ($3) goes to "market development" -- paying for cardboard Standees of the Gears Crew and elbowing other games out of the way for shelf space at your local retailer.
* 5% ($3) goes to actually manufacturing and packaging the disc.
* 5% ($3) is spent paying the Man for IP licenses or maybe hiring some big name voice actors. If your game isn't an original IP, here's where you get dinged by Marvel, Disney, or Ray Liotta's agent.
* 1.5% (just $1) goes into the publisher's pocket.
* 1.5% (also $1) goes into the distributor's pocket.
* 0.3% (about 20 cents) goes into corporate costs. Management, overhead, lawyers, etc.
* 0.05% (less than 3 cents) go into the cost of paying for the Developer's Hardware. Who knew an SDKs can cost tens of thousands of dollars?
And there you go. $60 of Gears, a la carte.
I think it's interesting that the Art guys take a larger cut than the programmers, but that also factors in Cliffy B's cut and I'm sure he gets a sizeable one ;)
And here's my picture... since we have to have one!
About the author
Brandon earned a Master's of Science in Computer Science from the University of Tulsa in 2005 before they asked him to leave. Since then he has worked in web development and mobile development all while honing his game design/programming skills.
#22
While I do think that $60 for a game is pretty high it really just depends on how much enjoyment you get out of it. Was Gears worth $60? I'm not sure yet... but it was close, I really enjoyed playing it even though it was pretty short. On the other side of the coin if you look at Zelda: Twilight Princess there is definitely enough fun there to warrant its $50 price tag and probably alot more. I've put in over 30 hours already and I'm not done with it. Just don't tell Nintendo, I don't want to have to pay $60 bucks from the next Zelda ;)
12/21/2006 (8:12 am)
Interesting comments guys! I only have a couple things to throw into this. I wouldn't be surprised if Epic was able to take a much larger cut out of the publisher's pocket in this instance. Microsoft NEEDED this Gears,for anyone that hasn't played it you really should it's an amazing game; in fact it's the only thing I've played on my 360 in about 4 months. I obviously have no idea how this deal was drawn up but I can see Microsoft taking a much smaller cut on Gears if Epic would keep it exclusive and get it out before the PS3. Not only is it a great game, which Epic really is known for, but it also really shows that the 360 can keep up graphically with the PS3. If Gears hadn't come out when it did alot of people would think that to get amazing visuals you needed a PS3, now we know that isn't true. While I do think that $60 for a game is pretty high it really just depends on how much enjoyment you get out of it. Was Gears worth $60? I'm not sure yet... but it was close, I really enjoyed playing it even though it was pretty short. On the other side of the coin if you look at Zelda: Twilight Princess there is definitely enough fun there to warrant its $50 price tag and probably alot more. I've put in over 30 hours already and I'm not done with it. Just don't tell Nintendo, I don't want to have to pay $60 bucks from the next Zelda ;)
#23
The thing you guys don't realize is that games tend to either be very succesful, or fail miserably. There isn't a lot (yes, there are some) of games that just pay for themselves. This isn't always the case, but usually. So they need to make enough off the good games to pay for the bad ones.
edit: forgot I wanted to comment on this:
You absolutely cannot compare something that is completely reliant on supply and demand like gas to something relying on a fixed cost they need to recoop like a video game.
edit2: bah, forgot about this one too:
Why is it too high? $60?! I don't care what club or bar you go to on a friday night, but you WILL spend $60 EASILY unless you don't drink and pretty much just stand around. Look at any theme park in the country (US) and you can't leave there for less than $100, $30+ just to get in.
$60 for a game that you will play for months on end and that's a lot? I think the problem here is that you guys are USED to $40 - $50 games and haven't realized that they haven't really upped in price in comparison to how much is spent on them. Back in the original playstation days games were $40 - $60 (rare few were $60), yet the cost to make them was 1/10th what it is now.
We're demanding higher quality and better gameplay, story, acting (and IMHO we're getting it) yet we dont' want to fork out a few extra bucks to get these things?
Hell, I can't even go to a damn movie with my wife without spending nearly $20 just to get in.
12/21/2006 (8:29 am)
Hmm. Well, I'd have to agree those numbers are way off. I do not agree that it's $60 just because people will pay that either. It's $60 becuase the company needs to pay all their bills and have enough left over to make a good profit for themselves (as a company) as well as enough to pay for the next title which is going to fail.The thing you guys don't realize is that games tend to either be very succesful, or fail miserably. There isn't a lot (yes, there are some) of games that just pay for themselves. This isn't always the case, but usually. So they need to make enough off the good games to pay for the bad ones.
edit: forgot I wanted to comment on this:
Quote:just like the price of gas...
You absolutely cannot compare something that is completely reliant on supply and demand like gas to something relying on a fixed cost they need to recoop like a video game.
edit2: bah, forgot about this one too:
Quote:While I do think that $60 for a game is pretty high
Why is it too high? $60?! I don't care what club or bar you go to on a friday night, but you WILL spend $60 EASILY unless you don't drink and pretty much just stand around. Look at any theme park in the country (US) and you can't leave there for less than $100, $30+ just to get in.
$60 for a game that you will play for months on end and that's a lot? I think the problem here is that you guys are USED to $40 - $50 games and haven't realized that they haven't really upped in price in comparison to how much is spent on them. Back in the original playstation days games were $40 - $60 (rare few were $60), yet the cost to make them was 1/10th what it is now.
We're demanding higher quality and better gameplay, story, acting (and IMHO we're getting it) yet we dont' want to fork out a few extra bucks to get these things?
Hell, I can't even go to a damn movie with my wife without spending nearly $20 just to get in.
#24
One thing to Epic's credit is their promise, and track record, of releasing additional content free of charge. Once I start to see extra content available on Live I'll feel much better about the price tag.
12/21/2006 (9:12 am)
I agree that the price to create a game is definitely much higher than it used to be but the problem is that we are paying higher prices for games that we DON'T get months of enjoyment out of. Gears of War is a great single player game but it only takes around 10 hours to finish. Multiplayer content will help it stay around much longer but the fact that game length is decreasing is what really makes the price seem higher to me. To be honest it really wouldn't be that much more expensive, compared to the cost already, to make the game 3 to 4 hours longer. There are SO many assets in that game that the levels could be made longer, or entire new levels could be created, that would require little in the way of new asset creation. I know there is still design, level dev, play testing, and other costs but after all of that art is created it's much easier to flesh out the game.One thing to Epic's credit is their promise, and track record, of releasing additional content free of charge. Once I start to see extra content available on Live I'll feel much better about the price tag.
#25
12/21/2006 (10:51 am)
I think we can all safely call bullshit on those numbers. Unless of course we're just talking about it's development budget. That has nothing to do with how much Gears costs at retail or with how many copies it sold. This is a case of flawed logic. The percentages come from the initial development cost, what Gears makes at retail would essentially be a flip flop of those numbers where the publisher would be getting at least 25% and the devs getting 1% etc...
#26
12/21/2006 (12:00 pm)
@Jonathan - It's been along time since I've found a game I want to play for "months on end". It's been several long dry years as a matter of fact.
#27
I think their numbers are off though... There needs to be a significant slice off the top going to distribution. By those numbers they are saying the development budget was over $50 Million.
It's a top quality title, but $50 Mill? I don't think so:) That's a monster size team, or a team with monster size paychecks:)
12/21/2006 (2:23 pm)
$60 - worth it. The content is quality, the tech is quality, it's fun to play. Value is a subjective thing. I value it. I think their numbers are off though... There needs to be a significant slice off the top going to distribution. By those numbers they are saying the development budget was over $50 Million.
It's a top quality title, but $50 Mill? I don't think so:) That's a monster size team, or a team with monster size paychecks:)
#28
For a $20 game of ThinkTanks:
* 56% (aka ~$11) Goes into paying for Awesome.
* 22% (~$4) for the Sweetness.
* 11% (~$2) for "LOL!!!!11" (Which GG buys wholesale.)
* 7% ($1.5) voice acting royalties to Engelbert Humperdinck.
* 3% ($0.6) Misc overhead costs, servers, bandwidth, hosting, equipment, Clark, etc.
* 1% ($0.20 paid in nickles) Skimmed off the top by and embezzled by John Quigley.
* 1% ($0.30) Lost in rounding errors.
12/21/2006 (4:42 pm)
Here's some internal GarageGames numbers, based on our website sales:For a $20 game of ThinkTanks:
* 56% (aka ~$11) Goes into paying for Awesome.
* 22% (~$4) for the Sweetness.
* 11% (~$2) for "LOL!!!!11" (Which GG buys wholesale.)
* 7% ($1.5) voice acting royalties to Engelbert Humperdinck.
* 3% ($0.6) Misc overhead costs, servers, bandwidth, hosting, equipment, Clark, etc.
* 1% ($0.20 paid in nickles) Skimmed off the top by and embezzled by John Quigley.
* 1% ($0.30) Lost in rounding errors.
#29
12/21/2006 (4:54 pm)
Awesome! How did you ever get a deal with Engelbert Humperdinck? ;)
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