Publishers tighten grip on dev budgets

Publishers are handing out less money for studios to developing their games, a new Develop investigation has revealed.

Multiple sources – many of which, though not all, have spoken on the condition of anonymity – tell Develop they have seen development budgets begin to fall.

In a special report, the likes of Rare studio head Mark Betteridge and Avalanche CEO Chrisofer Sundberg explain why there’s less money available to developers.

Key to the revelation is publisher confidence. While the major AAA blockbusters remain fully backed, the less assured bets are getting little attention.

“I have seen development budgets go down,” Sundberg tells us.

“We’ve always been in the $20 million-plus budget area, but last year I saw things adjust to over $10 million, and I think it’s a sign of the global economy and the bad times we’ve gone through.”

Rare’s Betteridge agreed that budgets – essentially, the money handed over by publishers – had fallen, but he also pointed out that the cost of developing certain games had fallen too.

“Look at things like the rise of mobile and handheld devices, or the increased use of middleware, or the growing number of sequels where old code can be re-used,” he said.

A third source – who was willing to have his comments published – explained that development budgets “are only half the story”.

He said, “Even when a project is past-the halfway point, a publisher still has an opportunity to cut its losses, because development budgets only make up half of the costs for a AAA game.”

More explanation on the matter can be found in Develop’s full report.