Is Indie PC gaming the next Mobile?

October 16, 2015 | Filed under: business

I try not to be *too* doom and gloom, but I’ve been keeping an eye on things, industry wise and lately a few things have darkened my mood. I’ve been ‘hearing reports’ about fellow indies new releases doing very badly, and a quick glance at some titles on steamspy seems to confirm those rumors. Because we are, in effect, just apes with keyboards, we are very vulnerable to following the crowd, and few indies who know *anything* about marketing will admit on twitter/blog/gamasutra that their game has flopped and they are looking for contract work unless they have completely given up hope.

I suspect a lot of indies are currently coasting on savings, sitting depressed and hitting F5 on the steam sales figures…

steam

..hoping its all an error.

I don’t think it is.

Lots of people have speculated on the possible reasons for this, and they include the prevalence of easy-to-use tools like unity, and its asset store, the many tales of ‘teh indie riches‘, the opening up of steam with greenlight, and so on. These may all be contributing factors. There are also various theories on how to survive and thrive despite this going on, such as concentrating on owning a small niche, slimming down development costs, hedging your bets with multiple games, or just gritting your teeth and riding it out and hoping other people go bust before you do. Again, these may all be sensible strategies.

But what occurs to me today is not ‘is it bad?’ or ‘how do we make it through?’, but the slightly more ominous question of how ‘how bad can this really get?’. To quote silicon valley, is it ‘apple maps bad’?

maps

Maybe it really is.

In a situation of perfect competition, prices drop until ‘normal’ profits are generated for the people supplying the product.  perfect competition doesn’t exist, but lets be honest, PC gaming is quite close. Almost anyone can make a game, almost anyone now can get it on steam, you can set whatever price you like and sell to the whole world. Thats pretty close. That also means that there is huge downward price pressure for commodity goods, such as generic shooters & platformers & clones of existing games. It also means that ultimately, all the games get made in China or India, where the cost of production is lowest. In theory, this means that developers in the US and Europe making indie games are kinda fucked. Why did you think outsourcing to china wouldnt work for PC games?

Lets forget for a moment the indies with established fan-bases, their own recognizable IP, or sufficient scale that they can throw around big marketing budgets, and lets look at the ‘new’ indies making their first game, maybe 2-3 people working on it. My question here, is how is the situation over the next few years for such a developer going to differ *in any way* from the situation with iphone apps?

apps

Depressingly, I do not think it will. We have an overloaded media, who have neither the time, or the staff (thanks to everyone using adblock) to actually cover new games and tell us which ones are worth checking out. We have a ‘popular myth’ that you can make a game and become a millionaire overnight. We have almost no barriers to entry at all, and we have a marketplace based around deep discounting, sales and bundles that are driving prices through the floor. Oh…and lets not forget that there are AAA publishers with huge back-catalogs they can dump on app stores for pennies, despite them originally costing millions to make.

The popularity of free-to-play facebook games, and other web games show that its delusional to think that people gaming on a beige box are any less-likely to demand ‘free’ as the price, than those same people are on mobile. Just look at the money made by world of tanks, or DOTA or LoL. Free is the new price, whether you like it or not….in almost all cases. At the other end is Star Citizen and its associated craziness…

The big problem with that, from a small business POV, is that the ‘free’ marketplace does not scale *that easily* down to indie size. The popular F2P games tend to be rather large affairs, backed by hedge fund money and run by big publishers who may have a dozen or more such games in their portfolio, happily leveraging this scale to populate databases of customer behavior between games. Indies can’t do this. I can email Democracy 3 buyers and tell them about big pharma, but its small beer. Very small beer.

When I look around at games that seem to punch through all this and make mega-bucks even now, I struggle to see any new names there. Lots of names I already know, but who is new? Who is the latest PC indie millionaire? All the names of my mental list of indie success stories have been around 5 years or more. I have to conclude that the ‘smart money’ is not on making an indie PC games right now. A bit of a bummer, as I’m making one, partly outsourcing another, and funding two more. Yikes.

FWIW I think the ‘smart’ money is in renewable energy, electric cars and biotech.

 

6 Responses to “Is Indie PC gaming the next Mobile?”

  1. Thomas says:

    I hope you are right in that last sentence, but my shares in renewable energy have been tanking since I bought them… ;)

  2. ido says:

    What if we all go into renewable energy, electric cars and biotech & those fields start “racing to the bottom” too? Then we again end up in the same place only everyone gets cheap energy, immortality & the environment is saved.

    Oh wait…

    • Les says:

      Hey Cliff,

      so it means you are giving up? ;-)

      We are trying to lure new players to our stock by having one game on sale, while another is at full price. So far does not work that well – we have niche product, but gamers seem to ignore everything not on sale.

      Good point about China – I am finding myself often playing something made by chinese developers. Some of them are really good!
      But they don’t have to sell 1000x just to pay rent.

      What you think will happen? Will China dominate Steam/mobile?

      Les

  3. Erik says:

    Crossy Road, monument valley, 5 nights at freddys come to mind.

    • Melibellule says:

      The latest -PC- indie millionaire, Crossy Road doesn’t really fit ;)
      But yeah, FNAF and Undertale come to mind (not really millions yet but seems to go in that direction)

  4. Michael A. says:

    I think it is pretty obvious that the PC and mobile markets are going to become more similar than they are different, so I’d say the answer to the question is a resounding yes.

    The good news is that the “standard” advice for indies: concentrate on small niche, slim down development costs, etc., – IMO – work well for the mobile device space. As such, I don’t see why these approaches should stop working in the PC gaming space, even as it becomes over-saturated. You won’t get a game like Democracy 3 developed by some “by-the-numbers” Indian or Chinese development house – same way you don’t get some of the more quirky/niche mobile games from the big development houses over there.

    Honestly, I don’t really see anything special about the PC game market. For a long time, it was a difficult market to penetrate, where only a few indies could make a living. Then it opened up with Steam Greenlight, resulting in the typical gold rush that always comes when a new big market opens up (is it coincidence that many of the big indie success stories coincide with the opening up of Steam? Not IMO) – and just as typically, leading to oversaturation and price drops. That’s the typical result of the gold-rush mentality (a classic post-mortem line I’ve seen is people talking about developing for PC, because it is perceived as the “easier”/more profitable market). I feel I’ve seen this pattern before. Eventually, the market will sort things out, and many of the gold-diggers will move on to the next gold rush (VR?).