Cecil: 'Traditional model doesn't work for new IP'
Thursday, 10th May 2007 at 5:15 pm
Revolution MD says the games business' revenue model is 'broken' when it comes to new ideas.
In his introductory talk at today's Northern Exposure conference in York, Revolution MD Charles Cecil has said that the current business model for games doesn't help new ideas reach market.
Giving an overview of the traditional business model which sees a developer's game shipped to retail by a publisher via a distributor, he pointed out that in the end studios get approximately just seven per cent of the revenuew - or £2.50 from a £40 game.
"But developers are still expected to fund the work and create a prototype for new games before a publisher will take onwership," he added.
"As a developer of original IP, for a number of years this model doesn't work. It's broken - and has been broken since the cost of development escalated."
It was this, he said, which explains why digital distribution is attracting developers - he pointed out that PlayStation Network games currently offer a huge revenue return, up to 70 per cent, which he called "extraordinary".
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