In the past I’ve spoken about Game Publishers in relationto Kickstarter campaigns, and the creative freedom of developers. This week, I’d like to explore a different aspect of publisher relations, and one I’ve wanted to discuss for a while.  Not too long ago the story of Darkside Game Studio came out, and how their relationship with a publisher wound up causing them to go under.

And you know what? I don’t think it was entirely the publisher’s fault.

Sometimes it really isn’t the big evil publisher the one who is to blame. Sometimes there are other problems at play. Too much ambition is not unheard of for one.

The Short Version

I don’t want to go into too much detail recounting the facts of the story.  For all of that, you can read the original report on Kotaku here:  http://kotaku.com/how-a-small-game-studio-almost-made-it-big-1696997142

The simple version of it is that Darkside was a small developer who had assisted in a number of successful games. They weren’t the primary developer, instead just acting as outsourced assistance, but still, they were well enough regarded that Microsoft offered them the opportunity to develop a title on their own. They chose the IP that they would work on, a remake of a niche title called Phantom Dust, and agreed to develop an online multiplayer only game of that IP for $5 million.

After the agreement was made, Microsoft seemed to make demands that would impact the budget of the game, and misrepresented the project to the public. Darkside tried to staff up to meet the needs, but in the end couldn’t implement what Mircosoft required within the budget. They asked for more money but were denied. When that happened the studio could no longer support itself, and thus closed down.

What Microsoft did wrong

There were a number of things that Microsoft did wrong that were unfair to Darkside. The most obvious one of course being that they changed the requested features of the game.  Microsoft also pulled that most obnoxious trick, putting together a demo video for the game that had nothing to do with the game.  That one is unfair to both the customers, and the developer, as the video will inherently make promises about the game that the developer quite possibly won’t be able to keep. They also put out other promotional material that was unrelated to the work that Darkside was doing, and made promises in public before talking to Darkside about it first.

Microsoft was guilty of things that are less obvious, though. One of the duties of a publisher is to make sure that everything is proceeding properly. In a simple sense it’s just making sure that their investment pays off. Ideally there would be something like periodic status update meetings, where the representative from Microsoft would speak with someone at Darkside and check on the status of development, the schedule with respect to completing milestones, the planned feature set of the game, any changes in the road map, and so forth. Without keeping in contact like that, then the publisher wouldn’t even be able to give the kind of marketing support they probably are obligated to do.

Now, given the fact that Microsoft changed the parameters of what they were asking of Darkside, it seems that they weren’t exactly operating sensibly in the first place. They commissioned people to produce a video for marketing purposes that was done entirely independently of Darkside’s work. That is an amazing waste both in terms of the cost of the production of the video, and in terms of public perception when they make it the game look like something completely different.

Yeah, it was a lie, but “Five Doallar Eleven Inch” doesn’t doesn’t have anywhere near as good a ring to it.

What Darkside Did Wrong

No matter how much Microsoft may have been deficient, there’s a lot of things that seem to have gone wrong with Darkside as well.

First and foremost is the fact that they agreed to the changes that Microsoft demanded. They should have had a deal signed, and they should have adhered to that deal. If they were going to be responsible developers, then if/when the publisher demands a change in scope then they should in turn demand more money if it is required for the new scope. If the publisher won’t budge, and the developer can’t afford the new scope, then they should strictly adhere to the requirements of the contract so they can move on.

In a situation like this, where more is being asked, passionate people will tend to try to throw effort at the problem in order to defeat it.  However, many problems require either more thought to overcome, or legitimately require more resources than are at hand.  Simply working harder is not a catch-all solution.

I love me some TR, and this is often a tremendous personal philosophy, but this doesn’t apply on macro level issues that involve dozens of people and millions of dollars.  Then you have to think and measure before you agree.

If the developer doesn’t say anything to defend themselves, then it’s completely reasonable for the publisher to think that everything is hunky dory. This is even worse if the publisher is changing the request, like Microsoft was doing, because then they think that the developer is just super flexible like that, or that changing the scope or adding features isn’t a significant problem. This can give the impression that the developer is just a rock star team.  Trust me, when people think you’re capable of anything, they may stop taking the trouble it causes you into consideration, and just think of you as some magic thing that gets stuff done. They may even become careless and rely on you to clean up after them.

The mistakes Darkside made didn’t start there, though. At the very beginning, when Microsoft gave them the chance to work on a game, they offered a choice of IPs to work on. Darkside chose “Phantom Dust”.  To be honest, I am not aware of this title, but this is a game described as having a cult following. Now, there’s nothing wrong with cult titles, or even starting out specifically targeting a cult audience. There are some genres that are just niche and will never appeal to a broader audience, and for them to become successful, the term “cult” will probably be applied to them. That can even be a good way for a developer to try to make a splash as their first title! In this case, though, there is more going on.

“Phantom Dust” was remembered for its single player campaign, where the initial pitch was for this remake to be multi player only.  This would go against the original appeal, and only serve to alienate the core “cult” audience that the IP had.  This was in place at the initial agreement, which looks to me like a decision made for personal interest in the title, rather than a carefully considered business decision.

The original feature set that was agreed upon worried some at Darkside.  In addition to the multi player mode, the hope was that this could eventually become an e-sport.  For my own take, the task of balancing something to make a viable sport of it is an unbelievably difficult task. Darkside bought in on this, though. This makes me wonder if they were truly of one mind, or if those who agreed to the deal were too eager.

Other business elements seem off as well. Purchasing licenses for software is expensive. If, while they were doing contract work, Darkside was using software licenses provided by the main developer, then in the transition to being a main developer they would need to purchase all of their own licenses. After that, the staff would have to grow almost no matter what, which incurs a lot of overhead that people often don’t consider. Even if all of that was well accounted for, serious problems start to show when Microsoft comes back only a few days later and starts to change the deal.

This visual metaphor is confusing.

Among the changes requested, instead of a multiplayer only game, Microsoft requests a single player mode. This is almost certainly not a simple change in any game. If the budget had already been allocated, then there is no excuse to either request this change, or to consent to making the change to the scope.  Darkside, again seeming to be far too eager to please, consents to these changes. This precipitates an increased ramp up at their studio, and I would imagine puts them on very shaky ground with respect to the already very lean budget. Yes, $5 mil is almost certainly a very lean budget for a major release.

Fundamental Business Problems

Somewhere in this it feels like Darkside is a studio that did not have a business person driving the business deals.  In fact, they were described as being founded by artists.  To be fair, perhaps among those artists was a capable business person, or they hired one somewhere along the way.  However, agreeing to this project, and accepting these changes makes me think otherwise.  Video Games is a creative industry, with creative people working on creative projects.  When that happens, it is true that deadlines will slip, budgets will be exceeded, and features won’t come out the way everyone wanted.  The fact of the matter is that this is still a business, though, and a strong hand is necessary to help guide any team through these waters.  Deadlines will slip, but they can’t slip forever.  Budgets will be exceeded, but money does run out.  Features won’t be right, but some are more important than others and can be cut. Business people help defend the team from other companies they’re working with from doing stuff like what happened to Darkside.  They help boost the team by making sure pay is good for the work.  They help to keep the projects on track, and making sure that everyone is on the same page. This kind of leadership is critical to avoid over promising, under delivering, or in this case, going out of business.

There’s plenty more to talk about for when this kind of direction isn’t present…

…but that’s a story for another time.

Kynetyk is a veteran of the games industry.  Behind the Line is written to help improve understanding of what goes on in the game development process and the business behind it.  From “What’s taking this games so long to release”, to “why are there bugs”, to “Why is this free to play” or anything else,  if there is a topic that you would like to see covered, please write in to kynetyk@enthusiacs.com