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cliffski

You dont need a million dollars ok?????

67 posts in this topic


to: Crystal Interactive CEO

Somebody asked:
"Will the author earn about 10% of the price the product is bought by the distributor or the retailer."

your answer:
"This 10% is of the trade price of the product".

Now what is the trade price? Sorry if I sound stupid !

Think of a game in the Rayman 1 class. Updated graphics of cource, and higher resolution. Will you "only" pay $1 per copy sold? That´s....well..not alot.......

Maybe I should cancel my project...

BEAM ME UP SCOTTY!!!!!










-- There IS something rotten in the state of Denmark --
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Dear Friends,

It seems I only generate more questions with my previous answers... I''ll try to answer them one at a time:

Anonymous 1: Yes, the contract is for 2 years, but we can negotiate a longer or shorter period of time if the developer so desires. But 2 years is really the ideal time frame to work in. Any publisher will tell you. Also after the contract ends you''re free to sell your game to another publisher. We simply retain the right to clear our inventory of said product. In our contracts the developer always retains 100% of the copyrights. So a sequel is not automatically ours to market.

Anonymous 2: We use all of the major chains like Dixons, HMV, Vobis, Free Record Shop, Bart Smit, Intertoys, Karstadt, Game and of course many independents. Our distribution is partly handled by local wholesalers and distributors and partly by a large Canadian company who export into Europe. I hope this answers your question?

Anonymous 3: How am I supposed to do that on this message board? If you E-mail me with your request on alexdv@nutridata.com I''ll gladly send you a picture of our latest releases.

Granat: Trade price is the price we charge to the retailers. So a game like Rayman 1 would sell to you, the consumer, for $30, but the retailers would buy it from us for $20 or $25. The difference is their profit margin. A percentage of this trade price is for the developer. So 10% would be $2 for each copy sold. Even though that''s not "a lot" (we pay more like 15% or 20% though) it''s necessary to cover production, advertising, warehousing, shipping and sales expenses, as well as giving us a decent profit margin to live on. So you''d get a $4 piece from a $20 cake. I''d say that''s not bad. Especially if we sell 50.000 units. 50.000 x $4 = $200.000. That''s in case your Rayman game does not sell that well. At least 100.000 units should be an achieveable goal.

Take care,

Alex de Vries
http://www.crystal-interactive.com
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Mr. de Vries,

I just wanted to thank you for being so patient and answering all of the questions that everyone has. I don''t think I would be near so kind after answering similar questions over and over and over.

Unfortunately, I also have a question to ask. I was wondering what sort of advertising is done to promote a title? Is there anything done or are sales mainly dependent on the consumer seeing a title on the shelf or the website and deciding that they want it on the spur of the moment?

Thank you in advance.


----------------
Go Blazers.
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Mr. de Vries - quick question: would Crystal have any interest in publishing a game that requires 3D acceleration? I''m not talking requiring Quake III Arena level horsepower, just about any Direct3D compatable 3D-capable hardware would do. The game will be fairly easy to approach for the average consumer (it''s not a "hardcore gamer" title). I''d rather not discuss the details much yet, as it''s early in the development cycle, but the concept has proven successful on console platforms and I have yet to see any *quality* products like it on the PC. I realize that the decision to publish would be based on many other factors, but I''d like to know whether it would be rejected based only on the fact that it requires 3D acceleration.
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Regarding the leaking of games from the developer. I remember reading in Game Developer that AoE2 was leaked from Ensamble. I think (IIRC) they said they belive someone FTPed the files from their network.
So.... there are many ways that games and application software are pirated. The publisher isn''t the only source.

David "Dak Lozar" Loeser
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And by the way, ditto what jaxson said! You''ve been extremely patient and helpful. I''ve read tons of helpful programming and game development articles all over the web and this site, but few people discuss the business side of game development in the detail that you''ve offered to us. In fact, you and DavidRM are the only knowledgeable people I''ve seen actually throw real numbers out there and discuss money at all.
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Mr. CEO !

I just want to say that I´m very happy that you have taken the time to answer our questions..

You are the only publisher (that I know of) that have written on this board, so naturally we all have 1000 questions to ask.

Also great that you are not afraid of discussing numbers.
$4 per copy is more like it..

In my mind a 50/50 solution is desirable. That is both developer and publisher share the income equally minus all the costs you mentioned.
So if the developer got $4 per copy; you(the publisher) would get about $4 after all costs have been deducted.

I doubt very much that you spend $20-8 = $12 on production, advertising, warehousing etc ????

How is this balance normally. How much more after deductions do the publisher get per copy ?

BTW. Feel free to stop answering our questions if we annoy you.

Thank you for your answers so far...



-- There IS something rotten in the state of Denmark --
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Mr.de Vries,
I also commend all this valuable info, and your patience.


I know this is a hard question to answer because it's kind of subjective, but...
$200.000 on the low end is amazing, but how good of a game is that usually?

I guess since we're talking about budget games it doesn't have to be quite on the calliber of professional games. I guess what I'm asking is that as long as the game has a pretty good, original gameplay, and pretty nice graphics (not necessarily dazzling state-of-the-art graphics, but pretty nice)does it usually do pretty well (maybe $50,000-$200,000) over 2 yrs.

I guess you sort of already answered my question by using a game like Rayman as an example...didn't notice that til just a moment ago

Edited by - Nazrix on May 31, 2000 11:47:33 PM
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Are you interested in 10 stand alone cd roms "Doom" shooting ups to publish in the 2 years contract.
Or are you not interested in it. So can you publish in the same 2 years 10 shooting ups cd roms of the same developer.
Or are you only more interested in variable gamesgenres.
By the way are you serious that a developer can earn so much for one cd rom game? It''s very much. It''s close to one million.
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Is it possible for the retailer to bring your published cd roms back/return to you, when he can''t sell it after a specific period. And then you must give his the money back he paid. Or is sold=sold the case, what is better for us, developer as publisher.
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Dear Friends,

Phew... You really make it a tidal wave of questions for me to answer Anyway, I''ll try to do so with everyone who''s posted a reply.

Jaxson: Thanks for your kind words. We advertise our games in-store with end caps and all sorts of extra joint efforts with retailers like featuring on their flyer, or being part of a sales promotion. Besides this we advertise in the popular computer games magazines. The backbone of budget games marketing is however impulse buying. Our budget for "Green thing hops up and Down a lot" is not as high as the budget for "Quake III". But that''s rather obvious.

Diragor: Additional hardware requirements have never stopped us from publishing a title. Our forthcoming product "Close Approach" actually as it happens has 3D accelleration. So that answers your question I hope? And thanks also for your kind words.

Dak Lozar: You''re absolutely right.

Granat: We always try to give our developers the best possible deal but in the end we have to please our shareholders/investors who''ve put up the money. A 50-50 split is definately the format we use in calculating the developer''s share, but a $10 game has a $5 trade price and therefore an extremely tight margin. Example: For a $19.95 retail game we charge a $15 or $12 trade price to the retailers. Let''s assume the $15 trade price for this example. A box takes us $1.86 to make. We also need to cover our expenses in terms of warehousing, shipping and the actual sales. The margin for these administrative costs will be at least $4, maybe $5. This leaves stuff like returned products (very annoying!) and advertising still to be calculated. In effect our net profits for the royalty calculation would come to $6 or so. We''d give our developers $3 and keep $3 as our net profits for taxes. I''ve come across a lot of people who think we''ll actually be able to split the $19.95 50-50 so some ignorance in terms of what it takes to publish a game in retail is not a crime. You seem to have a good understanding of the process though.

Nazrix: A good budget game is innovative to some degree and features something that triggers impulse buyers. So a cute character, retro style gameplay or a controversial topic usually do very well. You may have noticed the "Dweebs" license we''re currently using to push more products. The secret to this $200.000 for a developer is simple:
1) We pay our developers a fair share. Not common in the industry.
2) We don''t use silly clauses like "royalty stops" you''ll see in fine print in other publishers'' contracts.
3) Our distribution is simply that good

Anonymous 1: We''ll consider ANY game for publishing. So if you come to us with 10 consecutive DOOM style products we can publish all 10 of them. It''s however a fact that strategic marketing decisions would prevent us from pushing them all out at the same time. We''d be saturating our own market! But to answer your question: yes, we''re interested. And yes you can make that much money IF your game sells well enough.

Anonymous 2: Good question. A retail chain will often take products on a "Sale or Return" basis. This means that they''ll for example buy 5.000 units and sell these for a period of time. After that time we get the unsold products returned to us and a check for what''s sold. Our credit rating is so good that we can get 50% of the value of the purchase order up front from our bank in order to pay our developers and cover misc costs. Often it''s like this: a retailer initially buys 2.000 units and signs a contract with us for payment after 30 days. After 30 days they pay, and re-order. If they still have 1.000 left to sell they won''t re-order yet, but pay us after another 30 days for what''s sold then.

Take care,

Alex de Vries
http://www.crystal-interactive.com

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I have an extraordinarily hard time believing that selling "50,000" or even "100,000" copies of your indie game via ANY publisher is feasible. Folks, if you''ve ever sneaked a peak at real PC Data numbers, you''ll see that most mainstream, big-publisher games don''t even sell anywhere near these numbers. I think it''s really misleading to suggest that this is possible. Can you tell me the name of (and provide any pointers) to games the Crystal has published which have sold at least 50,000 units? How many games (or game bundles) have you ever sold that broke 50k units? What percentage is this of the total number of products you have ever sold?
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Mr. Alex de Vries

Again, thank you for your answers...
I understand that you agree with me on the 50/50 solution.

Fortunately I have run out of questions...I will keep the name Crystal Interactive in mind, in case I need a publisher..



-- There IS something rotten in the state of Denmark --
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Forgive me if I'm wrong but I have an idea about that last anonymous comment, about how these budget games can sell 50,000 - 100,000 even though the games on the charts aren't selling that much. For one thing, I believe all of these answers from Mr. de Vries are based on a 2 year time frame. The PC Data charts are based on data from a single month's sales figures (there's a weekly chart too, I think). I think smaller-profile games, by nature, probably have a more consistent sales rate than the latest blockbuster titles that fall out of favor after a few months. The games are not based on showing off the latest technology, they usually focus on more time-proof simple fun, and they are much cheaper than the big titles. While some fancy, complicated, big-name $50 game may blow quite a few copies off the shelf in a short period after its release, the budget games continue to trickle off the shelves in places like Wal-Mart, adding up to a lot of sales after two years but never touching the charts because of the slow, steady sales rate.

Edited by - Diragor on June 4, 2000 3:12:25 AM
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Dear Mr. Anonymous,

Thank you for yet another question. Mr. Diragor has already answered a good part of it on my behalf (thanks!) but I''ll elaborate a bit.

It''s true that most $30 titles (according to U.S. sales charts) do not sell 100.000 units. This is mainly because A) These are overpriced and overrated products, B) U.S. Sales charts do not calculate worldwide sales (WE DO!), and C) It''s a fact that a $9.95 game sells more then a run of the mill $30 game due to a simple marketing mechanism we call "impulse buying".

Our racking program alone is good for 50.000 to 150.000 sales of each title. Our Autobahn Racer, The Unholy, The Fugitive and Dweebs games previously sold exceptionally well in Europe. Autobahn Racer breaking records in terms of budget titles. But we''re not the only ones pulling off these fantastic numbers. Expert Software manage to sell millions of CDs a year, as well as eGames. 3D Frog Man by eGames is a 1.000.000+ seller! Never checked this??? Even though these companies sell huge numbers of products they still manage to pay developers dismally poor...

In any case this racking programme of ours (50.000-150.000 units + normal distribution (another 50.000+ units) and various licenses and OEM deals to other publishing (mainly Asian) companies result in a tremendous return in terms of volume. In Japan we pushed about 20.000 units of Dweebs, Treasure Island, Witch Frog and Sleepwalker out the door, and in Korea, Hong Kong, Singapore, Taiwan and mainland China we achieved another 50.000 units sold of each.

You won''t become a rich man by writing one budget game, but it''s definately worth your while!

Take care,

Alex de Vries
http://www.crystal-interactive.com
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When I have a contract with your publishing company Crystal Interactive for a Doom style game, can I have also at the same time contracts with other publishers for other Doom style titles?
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Whether it''s legal or not, wouldn''t you want to space out your titles a bit? Especially if they''re similar, wouldn''t you just be competing with yourself for shelf space and sales? You''d probably get more mileage out of the titles if they weren''t released at the same time. Just my $0.02, for whatever that''s worth.
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Anonymous: Yes

Diragor: Good point. We try to balance our range of titles as best as possible and not push out 20 a week. It''s just that the budget segment is a dynamic market and that there has to be fresh product available all the time.

With regards to limiting our own shelf space you''re partly right. In normal retail the problem is very real. But our main sales come from racking programmes. We own the racks, and therefore WE determine what''s in there. And believe me these racks can carry a LOT of different titles.

Take care,

Alex de Vries
http://www.crystal-interactive.com
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Dear Mr. de Vries,

In which countries are the retailers you mentioned: INTERTOYS, DIXONS, HMV , VOBIS, BART SMIT, FREE RECORD SHOP, KARTSTADT and GAME.

And what titles, the name please, are you selling to them?

Do you sell Dweebs for instance as a cd rom game to INTERTOYS?


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With which publisher do you have a sublicense contract. I heard something about eGames and
Activision value collection. But who are the other publishers then?

Thanks in advance.


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Hi Guys,

Anonymous 1: It''s really tiring to list every single title which goes in every individual shop... But all of the games are going into every major retail chain in every country on every continent. The stores I mentioned are in the Benelux (Netherlands, Belgium, Luxembourg) since the guy who asked me about it wanted to know the sales channels for these specific territories. Game, HMV and Karstadt are in the U.K. and Germany, not in the Benelux by the way.

Dweebs is both a game and a soft toy. So yes, we are selling the soft toy bundled with the game into this retail chain.

Anonymous 2: Well, just eGames and Activision Value. We do not limit our strength by doing a lot of sub-licenses. It''s only for 50% versions of some of our minor titles. Purely for bundles.

Take care,

Alex
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>In any case this racking programme of ours (50.000-150.000 >units + normal distribution (another 50.000+ units) and various >licenses and OEM deals to other publishing (mainly Asian) >companies result in a tremendous return in terms of volume.

I don''t understand this well? Could you explains this please.
What is an OEM deal?
Do you sell the game Starminer by the way on a jewel case?
Who are the other Asian publisher companies you have a sublicense deal with?
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The games are published with the Crystal Interactive logo on it.
Do the developer have also the right to place his logo on the package of his game.
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Elaborating on that question, assuming a stand-alone product (not on a collection CD) what part does the devloper play in the overall box art or CD jewel case cover (if there''s no box)? If not in your standard contract, could box art approval or at least contribution to the box art be negotiated?
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Is there financial information about your company available?
Just like eGames have on there site.
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