Flash Truth

…about flash gamedev and business

Understanding the flash game space

In my most humble opinion, most developers are clueless about where they stand in the flash game space from a market point of view. This leads to wasted time, bad business and bottom-line: low money. This only applies to developers that want to make a profit from flash games, to all others that live up for their passion, it’s pointless, although, maybe, educative.

Here’s how most developers face business assuming there’s a sponsorship deal for a small game…

1. Developer makes a game in a week;

2. Developer shows game around to get a sponsorship deal, although not full time, it can take two weeks easily;

3. Game is sponsored, let’s say, for $500 and developer takes a couple of days to include sponsor stuff;

4. Developer puts ads on game and distributes it which generally means at least another week;

5. Game spreads and traffic goes to the sponsor thus generating money;

6. Developer gets an average of 15% (from my personal experience) from ads, so an extra $75;

Let’s crunch the numbers…

First and most obvious there’s no such thing as one week games, or one day games, since build to market time is always bigger, but I’ll dedicate a post to that one of these days, but the hard truth is that a one week game can easily be a 22 business days game, meaning, a full month. All of that for $575 if you are lucky. Assuming you work 8 hours a day, that’s a $3,26 per hour rate, which, let’s face it, it’s pretty bad.

And why did this happen? Let’s follow the money now…

1. Developer makes a game;

2. Sponsor picks it and sponsors it for $500;

3. Most sponsors don’t actively spread the game, thus, no distribution costs;

4. Sponsor gets pass-through traffic that will generate around $1 per thousand visits but it isn’t that important;

5. Sponsor gets traffic that sticks from users that register and visit the site and play their games continuously, which can generate a lot of money if the site is good which the large ones are.

6. Advertising networks keep a huge chunk of the money generated.

The Truth

1. Has I have said before, developers have nothing to win from distribution itself. Portals and advertising networks get most of the profit from the plays and the traffic games generate, still, developers are worried about distributing their games like if it was the most important thing of their, second only to sponsorship. In fact, the most important thing is THE GAME! A good game will attract good sponsorship deals, not to mention extra licensing if you are smart.

2. Developers waste too much time, thus loosing money, doing things that will make others win money. Mochi Ads is a class act in this department. They do handle distribution but they do it at a low cost for themselves since they have an established network, which is good for both Mochi and the developer.

3. Smaller portals do make a huge effort to distribute the games they sponsor but most of the bigger ones simply don’t care. And they don’t care because they usually get the high profile games that will, sooner or later, wide spread on the web, usually at the expense of the developer or, if they allow it, Mochi.

Understand where everyone fits and make everyone do their job

1. Developers should make the best game they can. They should also strive to make all necessary arrangements to fit their sponsor and licensing portals needs, which is something I often see developers lacking: professionalism. Developers should not distribute games since game spread is not their income source or investment return.

2. Portals should either spread the game themselves or allow ads on games thus leaving the distribution for the advertising network since both have direct income from game spreading wildly. Using advertising would then be an extra incentive to the developer, not a need, a badly paid one.

3. Advertising networks should be the major spreading force since they are the ones that get the most of it. Most bigger portals already have a considerable user base, thus making licensing more interesting as a model.

4. Bottom line: each part does what it’s profitable for their core business: Developers make games, portals manage content and advertising networks manage advertising inventory.

Wow… this was a big one…

Still there? Ok… What matters here is that there’s a culture of “roles” in the flash game space and it’s the developer that takes the toll. Why? Well, most are naif and the big guns take advantage of it. I’m not saying portals are bad or good or that advertising networks are bad or good, what I’m saying is that the developer is the small guy that can be easily bullied if he acts alone while the herd is following a different direction.

We must rethink all of this, together. Us, portals and ads networks are partners in this, not enemies, so we need to sort our act together so that the market continues to grow based on quality, not a dogmatic approach of how it is handled.

January 8, 2009 Posted by | Advertising Networks, General, Monetizing, Portals | , , , , , , , , , , , | 5 Comments