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.

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

Stop complaining, will ya…

This is more of a rant than a “good” post. I’m tired guys, really tired and this is why I’m ranting about. I’m tired of reading “developers” complaining their games don’t get any sponsors. Are you one of those developers? Here’s some news for you:

Your game probably sucks!

Not only that, but your over inflated game developer ego forbids you to see the obvious, which is the level of suck-o-meter your game can achieve. The most astonishing fact is that you don’t give a crap about your game, do you? If you actually gave a crap about your game, you’d take time to make it better, polish it, soften the rough edges. If you cared about the players that will play the game, you would strive to give them the best possible experience. If you cared about the portals from whom you want the money from, you would make the game fit, you would make the game feel and you would make the game breath.

But no… your biggest concern isn’t that the game is not good enough… your concern is that the game is not good enough to give you cash. Your concern is not that you should’ve contracted graphics and music. Your concern is not the game’s financial break-even, if you even know what that is. Your concern is that no one will offer you money for it.

You are not a developer, you are a whiner.

On the other hand, you may not be complaining about it. Maybe you know why you are not getting any money, but you don’t care that much… you do your games for fun, and let me tell you, that’s the most noble thing to do. Maybe you even say “Yeah, getting some sponsorship would be cool, but I’m ok with not getting any” and I really relate to that.

But if you want to make money, if you want to make a living out of this: make a good game, the best possible one you can do and you can invest in and stop complaining, will ya…

December 3, 2008 Posted by | Monetizing | , , , | 2 Comments

Is sponsorship doomed?

Just read the chat event with Jared from Hero Interactive at Flash Game License. In the middle of a lot of questions and answers, one thing popped up. He said that he believes the current sponsoring model will move more towards a licensing model.

A typical flash developer would probably think that this is a bad thing, since exclusive and primary deals are probably the highest paid deals around. Let’s see what this means from a pure business perspective.

Here’s the math, round low numbers for clarity.

With exclusive sponsorship = $100

Imagine that you get an offer of $100 for an exclusive sponsorship. What this means is that you will get $100 and that’s it, maybe some advertising if the sponsor allows it. Your game will be on 500 sites in a month, the sponsor will get all the juicy traffic and that’s about it.

With primary sponsorship = $150

Many developers opt, if they can, for a primary sponsorship. That usually brings a nice sponsorship deal for a lower price, let’s say $75 and the power for the developer to sell site-locked licenses. For calculations, let’s imagine that you would sell 3 site-locked licenses for $25, so that’s an extra $75. The game would go to the same 500 sites, maybe some more cents from advertising.

Pure licensing model = $500

Let’s start with the basic of this. The game would NOT be distributed in 500 sites. The game would be licensed to any site that paid for it. Imagine this: only 20 sites would have the game, but each would pay $25. This is $500 right there. You can argue that portals can do this right now if the game has a primary sponsorship, but they don’t. Why? Because they can have the games for free. The beauty of licensing is that the game is not really freely distributed, but licensed for use.

What’s the big picture?

Well, this could change things a lot. First and foremost, this could mean either the rise or fall of advertising networks as we know it. Rise because portals that couldn’t license games would have to accept advertising not matter what. Fall because the high traffic portals would simply close down any external advertising offer.

This would also benefit more the big developers over the small ones. There would be more money going for developers but the offer would be uneven.

But I see this as a possible change in the business model. A change that is necessary since the right money is not going to the right pockets right now.

October 28, 2008 Posted by | Monetizing | , , , , , , | Leave a comment

Are you a greedy bastard?

I started this blog a couple of days ago with only one subject in my head: this one. Problem is I didn’t know how to write it without slapping the wrong people. And the wrong people in this case would be the guys behind Flash Game License.

Flash Game License

Flash Game License

So, before moving forward, let me start by saying that this post is not about FGL as a community, a service or a company. It’s not about the people that started it and maintain it. This post is about the wrong mindset that has been created by the possibility of quick cash… and do people love quick cash.

The outstanding success of FGL has made a large amount of developers join the FGL community. I don’t have numbers, but I believe that the growth was at a certain point exponential. The success of one developer brought two. The success of two brought four and so on. We have to understand that this success didn’t arrive by accident. What FGL allowed that was never seen before was to have a standard for both developers and portals. A standard place to show, a standard place to look, a standard set of information to use. The downside of it is that the huge developer community gathered arrived there with a purpose: get their games licensed and either you like it or not, that means they arrived there to make money.

As FGL grew bigger and moved more money, more sponsored games; the community grew eager of achieving the same goals of the more successful developers. At FGL and Mochi forums, questions were repeated ad-nausea. “How much is my game worth?” some asked, many times receiving an answer, from a developer, that finishes his post making the same question. This threads by developers for developers caused a constant feedback of false expectations because, truth be told, most games are worth $0.

Yep, that’s it… zero. Funny fact… many developers think every game is worth something and waste enormous amounts of time thinking more about money than about the product that will allow them to get money: the game itself.

So are you a game developer or a greedy bastard? The game developer in its essence is a hard working person. His next game is his most precious possession and he will strive to make it as perfect as it can possibly be. It’s that passion that creates something between good games and masterpieces.

A new breed of greedy bastards are now thinking day after day how much their 1 day game will profit. Game developers are spending one more day to achieve something grand. Money will smile to the developers.

October 17, 2008 Posted by | General | , , , , , | 4 Comments

Making money from flash games

I don’t have the slightest clue of the percentage of flash game developers that know they can make money from their games. Assuming at least one isn’t aware of it, I’ll try to tell you what paths are available.

Sponsorship

Many flash portals are interested in having their logos and buttons on flash games. This happens because people use the buttons and logos to navigate to the sponsor site, which translates to traffic, which translates to money. The more money they have, the more they will be willing to pay for better games since better games attract more portals, more players, more traffic and more money. I’ll give my take on sponsorship soon, but for now you can check these resources:

Flash Game License
Flash Game Sponsorship

Stuff

Although this is usually under the sponsorship umbrella, the truth is that it’s unrelated to sponsor branding. The “stuff” I’m talking about it to include APIs or make a custom version of your game or even selling the games rights to a third party that will then own the game. Hallpass has made the process of API inclusion quite easy and straightforward. The developer uploads a game with their API included and after Hallpass staff look at the game and aprove it, they’ll simply transfer $50. Not bad for a 15 minute job. There’s a world of opportunities around for several “stuff” just get to the number of forums around the net and pay attention.

Advertising

Advertising can be quite good or quite bad. The rule of thumb of advertising is that no matter where your game is played, you’ll get something, truth is, a lot of times you get nothing. Many of the big portals are not interested in games with ads, but you can make a buck if you use it. There’s a balance that the developer will need to find between cashing in a good sponsoring deal and having advertising. There are some offers, I invite you to check them:

CPM Star
Game Jacket
Mochi Ads

Revenune Share

Not all is bad news from portals that don’t allow ads. Some offer revenue share usually with a higher pay when compared to the advertising networks. The most outstanding portal that shares their own advertising revenue is Kongregate. Other’s offer it too like Fizzy.

Competitions

Too many to speak of really, but in my opinion most of them are bad for developers. These competitions either make you plug a logo and buttons in your game in exchanged for the remote possibility of winning a prize. That means you automatically exclude yourself from the best sponsorship arrangements. Others are cool though, even if very difficult. Kongregate and Nonoba offer weekly and monthly prizes to the games with higher ratings or number of plays. Althought the prizes are not that high, the simple fact that you enter the competition by uploading the game and eventually using an API, makes both extremelly attractive.

Advergames

This one is tricky. These are games that advertise a product, service or whatever they are contracted to advertise. You’ve seen it everywhere if you think of it. Little flash banners that want to you to score a goal, or to click it fast to win a push-up competition. For most flash game developers, advergaming is not that interesting since it looses the core mindset of game development and is more (if not completely) a marketing tool. To know a bit more about it, check Wikipedia.

And this is the overview of how you can make money from flash games.

October 16, 2008 Posted by | Monetizing | , , , , , , , , , , , , , | Leave a comment