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Royalties


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#1 Anonymous Poster_Anonymous Poster_*   Guests   -  Reputation:

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Posted 02 November 1999 - 02:31 PM

I have tried to find information about typical royalty figures when publishing a game. How much of the street price goes to the developing company, and how much does the publisher/distributor take?

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#2 MikeD   Members   -  Reputation: 158

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Posted 02 November 1999 - 04:02 AM

I only know what percentage of the profits we make as a developer.
Bascially we get 18% percent of the net profits after the cost of the development has be recouped by the publisher.
So we need to sell about 250,000 units before we see a penny.
The other 82% goes to the publisher, however I don't know what the profit level per full priced game is.

#3 DavidRM   Members   -  Reputation: 270

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Posted 02 November 1999 - 09:42 AM

Remember...royalties are paid to the developer based on the amount that is paid to the publisher for the game, not what the customer pays to the retailer.

There's a rather long "food chain" involved in getting a game into the hands of retail consumers. There's the developer, the publisher, the distributer, and retailer.

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DavidRM
Samu Games


#4 mason   Members   -  Reputation: 128

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Posted 02 November 1999 - 10:01 AM

To that I'd add...

Generally speaking, the more risk involved for the publisher, the less royalties the developer gets. If you don't need an advance to finish a game, it's less risk for the publisher, and should mean more royalties for you. Likewise, if you need $1.5 million up front, your royalties are going to be lower.

Mason McCuskey
Spin Studios
www.spin-studios.com


#5 logistix   Members   -  Reputation: 122

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Posted 02 November 1999 - 02:31 PM

Forbes magazine did an article on ID software last month and had a nice breakdown comparing ID to other companies. Keep in mind this is for big publishers like Activision. The important paragraph:

His work force is maybe half the size of other game developers. Other shops take advances from big distributors and thereby pocket only 16% to 20% of a games wholesale price. Id funds the $2 million to $3 million cost of developing a game itself and keeps closer to 35%. It relies on Activision to distribute its wares. Quake III could retail for about $50; Activision would collect $44 from retailers, subtract $3 for packaging costs and then pay Id a 40% cut of the remainder, or $16.





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