There is a even more problems with profit sharing and why music guys treat it with such a hesistation. To share incomes in a fair way there is a need to grant access to official sales figures. And it is often not so easy to do it to a person outside the company. As most people probably, I tried this model at some stage and gave up in the end because usually it works not to well. For example it is difficult to monitor multiple of projects after a couple of months, when you are in totally different place, moment in time and concerned with present challenges. Can be done with well established company which has it's own financial department which takes care about this part. But they usually not going into this kind of relations because of their own reasons. With smaller ones... that's risky.

A mentor of mine used to also point out this flaw with profit sharing:

What happens if (or when) the team grows?

For example, say there's a four man team - everyone's getting an even 25% profit sharing instead of any set payment. Everyone understands and assumes the risks involved. So far, no problem. The team sets up paperwork and every agrees to it. Later on, in production, the leader decides to bring in another artist due to heavy workload. Everyone's split just got smaller. What happens when this new person comes in way later in the project?

My point isn't that it's not fixable or there's not solutions but rather - it can get really messy, really fast.

The developer may think, "I have to take all the risk on this project, whether it succeeds or fails, so why should the composer get a fixed fee?" And that drives small developers towards trying to get free music, which isn't great for anybody.

In some cases, yes. But in other cases, audio is actually an afterthought. I've seen this before in pre-production planning where a lead hadn't even consider any audio costs, time or needs. I've also faced this in film work before. All of the money went towards actors, getting the best camera, props, etc. Then later when most (if not all) of the funds were already spent, the director and producer suddenly realize they need audio as well. Happens WAY too often, I'm afraid!

it can get really messy, really fast.

So true. Ironically the need for a clear agreement for an indy title is a greater in a lot of ways than for an agreement with a big company. Doing an agreement for a "percentage of profits" is actually quite a lot more complex than a simple "work for hire" contract, which is quite straightforward

It's hard even to define what "profit" is. Is it a game sale? What about the costs of marketing the game, or the 99/year fee to Apple.. or the fees for the web site and domain.. What about the designer's trip to E3 or GDC to "try to sell the game to a publisher", not to mention money paid to hire an extra artist to get the thing out the door, etc.

One fairly straightforward approach is something like this:

Composer is paid a quite small amount, but keeps rights to the music.

Developer has option to "buy out" the music for a fixed price within a term (say a year post launch).

That 'fixed price' would be quite high (say 3 or 4 times a normal composing rate).

That way if the game doesn't go anywhere, the developer hasn't paid a lot and the composer keeps their music

But if the game 'takes off', the developer can use the music, and the composer does pretty well, too.

I am still working on all of the legal documents now

Then you are smarter than 98.9% of the others out there :)..

So, more to the point, the budget is limited if any. I will run down some costs:
Adobe Suite: $4000 ( or 79 a month for 1 year sub )
Github Subscription: $10 a month ( for 1 year )
Obfuscation Software: $850 ( for 1 lisc and one developer )
Those are just three of the big ticket ones. So... music? If i can get away with giving somebody a % cut for the end product that would be ideal but most music people are like us, striving to get by and make it paycheck by paycheck. They need that money just as much as we need the money to make our game.

One of the standard libraries used for string orchestrations, LASS 2.0, costs 1000 for the basic library without the other add-ons.

That's just strings. Don't forget the DAWs and other instrument libraries, as well as mixing and mastering plugins. Interactive music software like Wwise also adds significantly to the cost of creating music if the developers one works with decide to have interactive music implemented in their games.

I'm not entirely sure if I misinterpreted your post, but even if I did, I think those of us in different disciplines could benefit greatly from understanding that each field presents its own set of financial and technical difficulties. These difficulties are multiplied by negotiations that are based on misinformation and paranoia that one is being shafted. That's why I think professional musicians really should make an effort to do a survey of the market to determine reasonable prices, and provide breakdowns to their clients so that nothing is left to guesswork.

I simply was unaware as to how easy or low the price is for the average joes work. This is an indie team and thus our budget is well below $20,000 until our kickstarter takes off. So, yeah

Hopefully this will make you feel better - I'm more than willing to take on a project with highly reduced rates (from my standard rates) if the project is really cool, shows great promise and progress and the team is fun and cool to interact with. This is especially true if I'm doing well financially in other regards. Granted, there's a limit to how much I'd reduce my rate down to but I'm more than flexible. Most guys I know are like this - so even if the "standard" rate is beyond what you can do, if you're cool and easy to work with plus you have a great project, odds are someone will be more than willing to accommodate that.

It's the teams/guys that present their first project ever as a WoW-killer, and are only using open-source, free software. That's a team I'd probably skip over!