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Zatun

My first publisher agreement

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Hi, I have received from my first round of agreement from my publisher. We have developed our title on our own without additional funding and the title is now complete. What type of payment options should I be looking at from this publisher apart from the advance payment option? -The publisher will be retaining the full publishing and distribution rights for 4 years (exclusive for retail); non-physical distribution non-exclusive -The territory is worldwide and is for PC -The royalties are 40 % of Net Revenues -The reporting and audit are Quarterly and Standard. -The publisher will be responsible for Marketing and PR campaign -The publisher also suggests for some additional extra levels for the retail version as we will be self publishing the title earlier. I am thinking of negotiating of the territory, the royalty and the term. Regards, Abhinav

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Should I ask for an advance payment and will I have to return the advance payment if the title does not perform?

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Original post by Zatun
1. Should I ask for an advance payment
2. and will I have to return the advance payment if the title does not perform?

1. Since they are asking for you to create additional content, yes.
2. It depends on what it says in the contract. (It depends on what you negotiate.)

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Pay attention to the definition of net. Occasionally you'll see opportunities for publishers to "double-dip" in the revenue for amounts already recouped.

Chances are you won't get less than 3 years for a term, which is the typical life cycle for a game.

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Original post by Haladria
From my experience, 50-60 % of net revenue is more common.

I bet it depends on the publisher. This article from an indie developer says that 40% of net revenue is actually high for portals like Big Fish Games. So maybe you are thinking of big name publishers like EA or THQ or something?

@OP: Congratulations by the way, best of luck to you and your game!

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Original post by lmelior
I bet it depends on the publisher. This article from an indie developer says that 40% of net revenue is actually high for portals like Big Fish Games. So maybe you are thinking of big name publishers like EA or THQ or something?

@OP: Congratulations by the way, best of luck to you and your game!


That article is a bit one sided too. Of course the portal is going to offer a deal that benefits them, that is business. But they offer advertising and usually getting your game on dozens of other affiliate sites. Yeah you could just setup a PayPal account and sell your game on your own site and get all the money. But unless you are wanting to spend a lot in advertising nobody is going to know about your game. This statement has no real basis, but either way you go you probably end up with near the same net income. Just that a portal you are going to sell more units.

The other non item is games on portals can't have links to sites. Games on portals have game company splash screens so its not like its very hard to figure out who made the game and Google the site.

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Original post by jtagge75
That article is a bit one sided too. Of course the portal is going to offer a deal that benefits them, that is business. But they offer advertising and usually getting your game on dozens of other affiliate sites. Yeah you could just setup a PayPal account and sell your game on your own site and get all the money. But unless you are wanting to spend a lot in advertising nobody is going to know about your game. This statement has no real basis, but either way you go you probably end up with near the same net income. Just that a portal you are going to sell more units.

Oh yes, I should've said I don't really agree with the article, but I remembered seeing actual percentages there so I pulled it up. Actually, many other indie devs that have posted their game sales statistics like this guy make a great deal more from portals than direct sales. The only ones who don't are pretty well-known indie companies like Positech and Spiderweb that have already built up a fanbase.

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Original post by lmelior
Oh yes, I should've said I don't really agree with the article, but I remembered seeing actual percentages there so I pulled it up. Actually, many other indie devs that have posted their game sales statistics like this guy make a great deal more from portals than direct sales. The only ones who don't are pretty well-known indie companies like Positech and Spiderweb that have already built up a fanbase.


That is a pretty good article actually. Its possible to do 'alright' with casual games. You just have to play to the market and do hidden object/match 3/etc type games instead of trying to do FPS/RPG/3D spectacular games. But I digress, I am dragging this off topic.

As for the actual question, I agree pretty much with Tom. 40% the best I've seen from a casual portal. And if they are wanting you to add new features to the game its not unreasonable to expect some kind of advance. Whether or not you have to pay that back if the game doesn't do well you need to discuss with them. Mostly likely you wouldn't start getting any money from sales until they recouped the advance so you probably would be responsible for paying it back.

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@Tom Sloper - Thanks for the reply. I don't have the contract yet. This is the initial draft or term-sheets I have been discussing with the publisher.

@madelelaw - Thanks for your reply.I guess I have a lot to learn.

@lmelior - Thanks for your reply. Actually, 40% is what I get after the below calculation.

Retail price- X
Tax- 19%
Retail fee-30%
Distributors fee- 20%
Production-1 X/unit

The publisher will take 60% of what remains and I will be left with 40%.

@jtagge75 - Wow. Thanks for the information.

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