Indie or not Indie?

What does it mean to be an independent studio or “Indie”? Can a volunteer or indie studio make a MMORPG? How do you get a studio funded? Do you really need a publisher?

I get the feeling that many people think that “Indie game development” means a group of people volunteering their time to work for free to work on a game…I think that they are wrong and we need to redefine or at least clarify what it means to be an indie studio…

Indie is short for independent, which means, or should mean, a game developer that hasn’t been “signed” by a publisher (to borrow a phrase). In the past, the number one way to fund game development was through an “advance against royalties” from a publisher. They give you money to *complete* a game, which they market and publish. As the game generates revenues, the developer’s royalty split was applied to the advance until it was paid back. Unfortunately, this has been a rather raw deal for developers, as publishers sort of stack the deck in their favor. This is why developers have to live from project to project, always reliant on publishers and royalty advances.

I would say that the definition of an indie studio as one that is not funded or simply a group of volunteers is wrong. Rather, an indie studio should be one that simply has not sold its soul to a publisher. In this day and age, it is possible to successfully self-publish, and in some cases that is the preferred thing to do. I think that small teams working for free on a project (or for stock that will one day surely be worth gazillions) be called a volunteer development studio.

There are multiple cycles that repeat every few years in our industry. One is based on consoles with new ones continually being developed and released into the market, which are good for X years before it is time for another model. The other one starts in someone’s garage with a few people that make a great game. They get acquired by a big publisher, where they work for a few years until they are burned out or just hate the bureaucracy and leave. They tend to start new studios and do it all over again, aiming for another acquisition (and stability).

The hard part of course is starting a studio. There is much more to it than just having a great idea and a couple of artists and programmers. Sure, if you want to make casual games on nights and weekends, it isn’t that hard with some dedication and persistence. But trying to launch a commercially viable studio and build a company requires blood, sweat, tears, talent, vision, expertise, and a lot of money.

So where does the money come from? Friends, family, angel investors, corporate investors, venture capitalists, advertising revenues, regular revenues (profits from the sales of smaller games?), and so on are all viable options. None of them are easy, but they *are* options.

I am continually meeting people that want to get into the game industry, and they either have a perception and expectations that are way off base (“I can make a fortune playing video games all day!”) or they ask that grand question “how do I get a job in the game industry?” The thing that really perplexes me is that there are literally dozens and dozens of developers and publishers that are always hiring and they whine about the lack of qualified candidates. The one thing that will do the most for you as far as trying to get a job in the industry is to have EXPERIENCE FINISHING A GAME.

That’s right. If you want to leapfrog other people trying to get a job, get some FINISHED games under your belt. Doesn’t matter how big or small they are, as long as they are finished. But wait, if you can’t get a job, how are you going to get experience?

Three ways:

  1. Find a volunteer studio. Yes, there are dozens of them out there, and most of them will never get anywhere. Find one that has some good leadership, project management, and a solid vision of what it is they are making. Sure, you probably won’t get paid a dime, and maybe the game will never make it to market, but experience is the key that opens doors. The best experience is a finished title.
  2. Find an indie studio. These will have some funding, most likely from angel investors and in the rare case a venture capitalist. The pay will suck, the hours will be long, but these are the studios that you should be hunting for. The ability of management to secure funding is something you should pay attention to. Most smart investors won’t throw money at just anyone, and many people have heard me rant about some really really stupid investments that some venture funds have made, but the fact is that if someone can score some funding, they must be doing *something* right, and you have a decent chance of getting a game finished. If you are lucky, they may also have the ability to get it published (on their own or through a regular publishing deal).
  3. Make your own games. Keep them small and manageable. Build a small team of dedicated people and just make it. Think small, efficient, and simple. Get it done.

Can an indie studio make a MMORPG? Yes, absolutely, but it isn’t going to be easy.

Can a volunteer studio make a MMORPG? Yes, absolutely, but the chances of finishing one and getting it out the door are extraordinarily small.

Will either be successful? It depends. Just having a publishing deal (or being a publisher for that matter) or even having loads of money is no guarantee of success. I think that anyone can *make* a MMORPG, but there are very, very few people out there that have the ability to *craft* one. How many MMORPG titles and studios can you think of that either never made it to release and disappeared into the ether, or did make it to launch and failed miserably? Why do you think this happened?

~ Nicodemus

13 thoughts on “Indie or not Indie?”

  1. Nicodemus wrote: “I think that small teams working for free on a project (or for stock that will one day surely be worth gazillions) be called a Volunteer Development studio.”

    Personally, I’d like an ancronym for hobbyist game development that’s slightly catchier than V.D. ;)

    I agree with your definition of indy (that the developer has not ‘sold its soul’), with one caveat. While I haven’t worked in game development, I have worked in technology startups. There is more than one way to ‘sell the soul’ of the company.

    Any investor (angel, VC or publisher) that exerts crontrol without participating in the ‘daily vision’ buys a bit of soul. An external angel investor exerting control and focusing solely on risk mitigation or time-to-market seems little different than a publisher.

    The obvious counter is, of course, that any investor is going to care about these things … true, but an ‘involved’ investor that buys into the company (or studio) vision may apply a very different metric.

  2. Hey Tuebit!

    My apologies. Names ARE important, and so are acronyms. The ironic thing is I just finished writing a blog entry (on curious raven, my private blog) about the importance of names, and naming things appropriately.

    VD is a terrible acronym. And perhaps “volunteer” isn’t quite in the spirit of what a “hobbyist” gamer is. Maybe “casual” or “hobbyist” is much better.

    My point about “selling the soul” was more about giving up control to a publisher, not about where the funding is coming from for development. As you pointed out though, publishers AND institutional investors (particularly venture capitalists) demand and exert a great deal of control over a developer. Publishers will push to ship the game ASAP (which is usually a bad idea), determine the marketing (nearly always a bad idea), and sometimes force the developer to completely change a game or the creative vision behind it. Venture capitalists on the other hand will insist on greater corporate control and they want a quick exit…they can force management changes or even merger/acquisition/IPO processes. Sometimes (very rarely these days) their interest is in the quick buck, not working with you to build a company.

    Still though, I would consider a *funded* developer independent, regardless of where the funding came from. They still have a fair degree of control over creative direction, marketing, distribution, and business development. A venture capitalist is also likely to be more understandable on somethings whereas a publisher can be like a stone wall (besides, VCs are much more interested in innovation than publishers are).

    ALL money has a cost. Even a really good deal for funding will have some cost to the developers and designers that need to be understood.

  4. Those are good examples.

    CCP originally had a publisher, Simon&Schuster, so they wouldn’t fall into the indie category. Although now that they are doing things on their own, you could easily call them independent (they did take funding from external sources early on as well).

    There are a lot of indies out there making games (casual, mobile, PC, online, etc), and I think that is a good thing. Personally I think the old publisher business model is outdated and handicaps the industry a bit. There needs to be some change and innovation there.

  5. Then at the other end of the spectrum there are those few studios that manage not to sell their soul(*) because of the quality of what they put out. iD, Blizzard and Epic come to mind. I wouldn’t say they are completely free from publisher decrees and interference, but they are certainly given much more ‘room’ than other houses.

    –J.

    (*) Not too much at least.

  8. Pingback: WorldIV » Indy Lands

  9. As someone who has done the indie thing for a bit (and written quite a bit on my blog), I’d like to echo what Tuebit says above. People who take large amounts of funding from VCs really are no more “independent” than people tied to a publisher. Anyone giving you a significant amount of money will want some accountability and most likely some say in how that money is spent. That tends to limit how truly “independent” a development studio can be.

    But, even if you are tied to a publisher does not mean you are not independent. Blizzard was able to maintain a lot of independence despite being bought by a large studio. id is another company that has managed to remain mostly independent even if they work with publishers. The secret is to not need to rely on the publishers entirely. id, for example, was a well-known shareware developer when they hit it big with DOOM. Publishers were falling over themselves to distribute DOOM, giving id the income they needed to survive in the long haul and be able to dictate their own terms. A lot of the terms publishers demand from small studios these days are, frankly, intended to prevent another id (or Blizzard, etc.) from happening.

    I’ll also echo what Jeff Freeman says above: launching a game is only a fraction the battle. Maintaining the game and providing services is a large responsibility, too, and that can demand even more resources than development in some cases. A studio that can launch a game isn’t necessarily a studio that can support the game.

    My thoughts,

  10. So, what you are saying is that independent status depends on how much money a company takes from outside sources? Or if publishers are falling over you to distribute your game, as long as you have already made it, you can maintain independence?

    Am I missing a point here Psychochild?

    Is “independence” based solely on some intangible notion of control over corporate and creative direction? Why should the amount of funding a team raises have anything to do with it? Accountability to someone for how vast sums of money are spent should be a good thing, especially for inexperienced studios and doesn’t necessarily mean that someone is going to be there on a daily basis making demands over the creative direction of a game. Anyway, the money for development has to come from somewhere…gone are the days where two or three people can quit their day jobs and work in a garage to create a AAA. Does it matter if it is from “friends and family”, a bank, angel investors or a venture fund? Or does it all boil down to the requirements that are tied to the funding?

    And what about publishing? Are you an independent if you refuse to take funding (advances against royalties) from a publisher until the game is finished? Or is it simply a matter of making sure you have full creative control? Even then, if a publisher gives you funds, you know they are going to be all over your budget spending just as much as a VC would, to protect their investment. I didn’t mean to imply that you must go without a publisher to maintain independence (obviously ID and Blizzard are pretty damned independent, although they work quite closely with publishers).

    What is the general perception out there? How is the mark of independence similar or different in other industries, like pop or hip-hop, or even movie studios? Is it about creative control? Financial freedom? The percentage of volunteer/hobby team members? Whether or not you work with a publisher? Even so, does it matter how much money a publisher gives you, or when? (before or after development).

    I’m not satisfied that there is a decent definition for independent right now. I feel like anyone who calls themselves independent is likely to be unfunded and working out of a garage, or may have some small amount of funding from friends/family or even some very small revenues from a casual game or two.

    Anyone else want to take a stab at defining independent?

    Robert / Nicodemus

  11. Commenting only as one who plays games, I think “independent” is simply when there is no other outside force pushing the you to make changes or rush things. Being in charge of one’s own destiny if you will. As soon as someone, for whatever reason, establishes a position of power that can force you to make decisions against your own will, you are no longer independent.

    Then again, I’m just a gamer.

  12. Would you define EA, NCSoft or Nintendo as independent? They certainly do what they want when they want…

    Can an indie studio be a publicly traded company?

  13. Personally I don’t know enough about how those companies operate to say anything. However, in my experience, being publicly traded often puts you in a position where your choices are being pushed by outside forces (shareholders).

Comments are closed.