Archive for the ‘Business’ Category

Contracts vs Self Publishing

Without a doubt the weirder title I ever wrote on a blog… still, there’s a purpose to it.

Not that long ago there was a stop on our blogging, game releasing and so on and so forth. As some of our recurring visitors (yes, the whole two of you!) noticed this was related to a number of games we worked on with other developers and company.

Contracts take us away from Flash Game License and our own blog which really lowers our Internet visibility… on the other hand, contracts are good because they allow us to get lower risk work and therefor, money, which I hope you can understand and relate to.

Why am I sad then? Well, I’m not exactly sad, but contracts do have an evil side. We are a game development company that focuses on creating and developing its own IPs. For that we have to create and market our own games. Time doesn’t stretch as much as we would like to, so, when a contract is up our games are left behind until further notice.

And we got notice of another one contract… so I’m a bit sad that our current project will take yet another delay, but happy to know that our company is going stronger. We won’t leave the blog unattended though, not this time… and we have some things that we want to share with all of you, so stay tuned, we’ll be right back!

Vlad!

Sponsorship, licensing and publishing

Like I commented on Freelance Flash Games blog, I disagree with the current definition of sponsorship. I disagree not because I’m some kind of linguistics freak (English is not even my first language) but because I feel that the discussion of the terminology, together with experience and knowledge brought from outside flash game space can bring new ideas and new formulas to both developers and portals.

Sponsorship

Sponsorship is a deal where the sponsor entity gets itself associated with a sponsored entity in return for some commercial value that it would not have if there was no association. Translated to our reality: sponsorship is a deal where a portal gets associated with a game in return for traffic generated by that game.

In other sponsorable property it is possible to have several sponsors. Think about F1 cars or TV shows. As you may know, a sponsorship in flash games is exclusive.

Licensing

A license is a permission. Licenses are issued by city halls, governments, software publishers and so on. Every time you buy a game you are being granted a license, same applies to a movie. All content on each TV channel is licensed to be aired by that channel. When you drive a car, you have a license to drive and a license issued so that the car can use the pavement in your country.

Same applies to flash games. When a developer sells a non-exclusive site-locked license he is not being sponsored. He is granting the portal a permission to use his game. What about primary licenses… well… a primary license is somewhere between the sponsorship model and a true licensing model. What separates a 100% licensing model from what we have now is the primary licenses. On the other hand this licenses are what makes traffic go up and down, so until something special happens, I think it’s a good thing for everyone that it still exists.

One interesting aspect about licensing is that it is widely accepted that site-locking a non-exclusive license is done to protect the interests of the primary license holder. As I see it, it is protecting the interest of the developer because the non-exclusive site-locked license could exist and the viral version be used for commercial and brand awareness of the developer. If every single developer worked his own brand awareness by not selling a primary license, making the viral version his own and then selling only site-locked licenses we would have a full licensing model, which we can only speculate if it would work or not.

Publishing

From AAA console games to casual download games, there are a lot of games where a publisher finances the game. This is the foundation of the publishing model: a publisher accepts a project from a developer, funds it, markets it and distributes it. The commercial catch is that the publisher controls everything except the production. For all that matters, the property of the end product belongs to the publisher.

Apart from some portals internal development, there’s no real publishing space in the flash market. I don’t think that it is doable though. Publishing usually involves financing the whole project. I’m a firm believer that most sponsorship deals don’t cover the development expenses if most developers took their time to see the costs they had. So it is possible to get the same performance by sponsoring with an amount of money that isn’t quite the same as if the same portal was publishing the same game.

Hope this helps to sort some ideas out. Stay tuned on Freelance Flash Games blog… I know he has something to say about this too.

Signing out…
Vlad

Selling non-exclusives

It has been the reason for many personal messages in forum and emails. It has been the “so sorry to bother you” private chat topic: non-exclusive licenses. Many developers want to sell it, others have portals interested in it, but have no idea of the price tag to put up or the money offered is acceptable.

Non-Exclusives 101

To accept non-exclusive licenses you cannot sell an exclusive one. So no sponsorship deals if you want license based deals going. You can have (and you should have) a primary license for maximum revenue.

Non-exclusive licenses must be site-locked to protect the primary licensee investment. The money you get for a primary license can be a good starting point for deciding prize tags for FGL Shop, but should not be used as a rule of thumb for every single deal.

Factors that influence the cost of a non-exclusive

Traffic… the hidden beast

A portal will buy the developer a non-exclusive license for several reasons but the first impact of having a non-exclusive site-locked game is that it won’t drive traffic to the portal’s competition that has the primary license. It’s not difficult to imagine that this means money.

In a way, a non-exclusive license makes the game exclusive to an already loyal portal user. This also explains why there’s a no link obligation in many requests for non-exclusive licenses. No links means no distractions. Traffic is the core product of most flash game portals and we must understand that.

Price wise, it’s pretty easy: the bigger the portal, the bigger the traffic, the bigger the need to make that traffic stick, therefor the higher the price and unlike what many developers say, portals are aware of that and are willing to put up a fair price.

Game Quality and Visibility

This should be pretty obvious. A better, deeper, more entertaining game will produce more hits to the portal that is licensing the game, therefor this should be reflected on the price. Sometimes this happens simply because the primary license offer reflects it.

This is even more obvious with well known IPs. If a game does well, players will recognize it later on and you’ll notice a snowball effect on some portals, made by players that have appreciated your work before.

Requests

APIs, logos, no links and so on. A lot can be asked for a non-exclusive license and these things take time. Not really a big issue, but you have to be prepared for it to make it worth.

Create your own custom buttons for your site for instance. These should have code that would read some “global” boolean if links are allowed or not. You can create your own API manager, preloader stuff and so on, anything that can make your code easy to adapt.

But there’s another side to it… each of these things add value to the portal and some even remove value from you. No links policy is a good example: traffic sticks to the portal and you don’t get a visit from your beloved players, thus not raising your own brand awareness.

So lowering your cost to answer these requests is by default best way to get a little something more from it.

How to calculate it?

Don’t… it’s my honest advice. Like I said above, the price of the primary can give you a basic idea to work with, but that needs to be adjusted to each portal’s size and requests.

On the other hand, or you have a known daily cost and daily goal and it’s matter of pure math to know if it’s a good deal for your or not, or you’ll be thinking time and time again if you are selling to low or not.

Don’t be radical

I guess the most difficult part of this is to learn to evaluate the game and the market porperly. On one hand, if you sell licenses to low, you’ll be damaging every developer’s business. On the other hand if you think too high of your game you’ll be damaging your own business.

While common sense says that you should bring the price as high as possible, sometimes it’s better to accept a low offer to increase your business in the long run or negotiate a high offer to position you, your brand or IPs or simply your business standing… just don’t be radical.

Vlad, logging out…

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