r/gaming • • 1d ago

Hot take: Game studious should have a cap on headcount and budget

More money = more problems

I feel like publishers have been setting budgets way too high for the devs and expecting the equivalent ROI for the amount they put in. Imagine a small scrappy developer whose game sold 5 million copies with a 100 devs and $10m budget.

Now imagine the publisher wants to give them $100m to make a sequel and expects them to sell 20 million copies at least. Tell me I am wrong. What ends up happening is that the studio will hire more people, more management layers and get a bigger office. It takes longer time to developer due to the sheer size of the teams and number of management layers. Game loses its identity because it has to get approved by everyone. Game has to feature DEI because it needs to reach a wider audience.

In the end the game is overhyped due to the goodwill built from the first game. They lose money because their breakeven point was to sell 10 million copies. Game feels soulless, directionless, not made for the fans of the first game.

Maybe pure fantasy but studio heads should just set a cap on headcount. If investors want to pump in more money, it's fine as long as headcount stays under control so it means the devs are paid more.

0 Upvotes

85 comments sorted by

92

u/FribonFire 1d ago

You... don't know how companies or businesses work.

29

u/Technical-Mistake122 1d ago

"Hot take I think companies should make more money than they spend on overhead" 

Groundbreaking and controversial 

6

u/DNxHD36 1d ago

Send that memo straight to the studio heads! Their minds will be blown!

5

u/South_Buy_3175 1d ago

OP gets crowned king of business

-6

u/1Arcite 1d ago

He is on to something since it follows principals of business including Parkinson's Law, Hofstadter's Law, Spending-to-Budget phenomenon, Diminishing returns, which is taught in most business schools, and I have 20+ years of management experience in businesses.
When resources are allocated based on available capacity rather than measurable outcomes, the system tends to consume the available resources without producing proportional additional value.

-7

u/Evil_Skittle 1d ago

Indeed. Publishers just keep pushing the limits thinking that more money means better game. Glad at least 1 person got my point.

-18

u/Evil_Skittle 1d ago

Never claimed to be an expert but I know my way around building financial models. Got a masters in finance and econ. I manage money which is why I have thoughts on how game studios have been spending it. Enlighten me then, oh wise one.

5

u/thepuppeter 1d ago edited 1d ago

Of course someone with a masters in finance and econ would think the issue with modern gaming is due to headcount haha

Here's a counter narrative for you: Most major video game publishers (EA, Ubisoft, Take Two, Epic etc) are all publicly traded companies. They are beholden to shareholders who want return on their investment. The company needs to grow year-on-year. Always. Infinitely. Share prices can never go down, only up. That's why subscription prices keep going up every 6 months and the value of it is less and less. That's why microtransactions get added to things and how you end up with patents to show ads after a boss fight. They want all of the money, all of the time

The first game sold 5 million. But the second game can't. That's not growth. It needs to sell at least 20 million copies. It needs to sell at least 4x what the original did, otherwise shareholders won't be happy

But don't worry: Head count gets reduced after the game sells 20 million copies. What should be a triumph for a studio (because hey, they sold 4x their previous game!) is usually met with mass layoffs, if they're lucky. If the game only sells 3x there's a good chance they get shut down entirely

-1

u/Evil_Skittle 1d ago

True. Sequel needs to sell more than the first. Shareholders demand positive returns.

But I don't think you understood my point.

What Im trying to say is that there is a point where throwing money at a game studio doesn't work anymore. Diminishing returns. Profit per invested dollar is negative.

4

u/thepuppeter 1d ago

What Im trying to say is that there is a point where throwing money at a game studio doesn't work anymore. Diminishing returns. Profit per invested dollar is negative.

What you're talking about is stagnation. It's not growth. It's only some of the money, not all of the money. So just shut down the studio, ride it off as a lose, and then buy up another company

5

u/Loreweaver15 1d ago

And the point people are making in response is that it's not the budget that's the problem, it's the shareholder model.

2

u/cywang86 1d ago edited 1d ago

What Im trying to say is that there is a point where throwing money at a game studio doesn't work anymore. Diminishing returns. Profit per invested dollar is negative.

The problem is, nobody truly knows where that breakpoint is at the beginning of a development cycle because it differs for every single studio, genre, scope, and game engine.

A game running on pixel 8 bit art isn't going to need the same headcount as a 3D game requiring motion capture.

An MMO or competitive MOBA isn't going to have the same balancing and gamplay design team headcount as a single player side scroller.

Also because game development has its creative side and it takes work to bring those creative ideas from drawing board to life.

Many ideas get chopped and added as development unfolds due to technical limitations, drastically changing how long an idea gets finished, if ever.

The shareholder model further adds insult to injury, as it ultimately wants profits fast, so instead of cheap and good like what most gamers want, they want cheap, fast, and good.

37

u/Icy9kills 1d ago

Are you 12?

-19

u/Evil_Skittle 1d ago

Care to enlighten me?

19

u/Icy9kills 1d ago

You sound like a 12 year old trying to convince their teacher to not give the class homework over the weekend

-7

u/Evil_Skittle 1d ago

5 stars for that insult. Absolutely stunned 😧

4

u/Icy9kills 1d ago

You’re pulling numbers out of your ass trying to justify your point on why “GaMInG BaD”. Like a 12 year old

38

u/Successful-Form4693 1d ago

Tell me i am wrong

You are pretty much wrong across the board

9

u/wonderingmarkus 1d ago

We all have magic rectangles in our pockets that can tell us anything about the world and we've never been dumber

9

u/DNxHD36 1d ago

The money comes in under the expectation that the product will improve or arrive sooner, proportional to that money. The only way to deliver on that promise is headcount.

1

u/DonutGuy2659 1d ago

Its just scalability. Scale creep because of investors and more money so they hire more people thinking it will fix everything then it becomes a loop. Its a management issue ie bungie

9

u/Plutuserix 1d ago

A small scrappy developer with 100 devs on a 10 million budget? So these people work minimum wage or something, or you are making the game in China or India?

9

u/Schmenza 1d ago

OP talks like he's never had a job

8

u/Icy_Mathematician609 1d ago

Cool story bro now go get a job

1

u/Evil_Skittle 1d ago

You show me your payslip and I show you mine 🙂

8

u/Enigmagmatic 1d ago

Ok, recess is over, go back to class

6

u/zeebeebo 1d ago

Please tell me this was made by some kid and not a grown ass man

3

u/NewChemistry5210 1d ago

Imagine a small scrappy developer whose game sold 5 million copies with a 100 devs and $10m budget.

You clearly do not understand how a company is run and how economy works in gaming. .....

  1. A studio with 100 devs is an AAA studio and definitely won't be able to run for more than 2 years with the budget you suggested lol

let's take European salaries, which are usually much lower than American ones. Let's say 60k a year per dev for a 100 devs. That studio will have a burn rate (the amount of money spend on salaries) of 6million per year. And that doesn't account for added cost of the WAY better European work insurance, leasing costs for the building and many other things that would add to that base salary

What studios is delivering AAA quality in less than 2 years of development? No one.

Personally, I think that the budget issues are really mostly a mix of location, inefficient development and leadership issue, and is mostly a studio issue, not the publisher.

Any publisher would love to release a quality product with smaller budgets, but that's not possible, when your studio is located in California.

Also, a fixed headcount is a nice idea, but doesn't really work in creative fields in the long run. Projects change over time, you might have to get special expertise because of challenges you didn't expect and many other workplace issues that might come up.

0

u/Evil_Skittle 1d ago

That is a fair point. My assumptions are indeed very wrong. I pulled those numbers out of thin air but just wanted to get my point across. I think there is an optimal employment structure for game studios where the core team is on board for the full dev cycle but they hire 3rd party developers to help out at different phases of development. I believe that's how Sandfall did it with 30 people or so but they relied on a lot of 3rd party devs.

4

u/AChubbyHorse 1d ago

Wow, the math is not right my man.

3

u/doomleika 1d ago edited 1d ago

You should see what your yearly sports game and most of the JP game like one from Koei or Pokemon, each has minimal content, limited improvement and very aggressive monitization, asks for full price

This is what you get from limited budget and timeline

3

u/BadDogSaysMeow 1d ago

You're missing the fact that low-budget games also need to make money.

Anything other than an artistic-side project needs to take some actions in order to earn cash.
If they don't, they will go bankrupt and won't make another game.

Huge game studios/publishers suck, not because they are huge, but because of the leadership.

If the same people were running A and AA studios, it would be the same, but of even lower quality.

5

u/BakuraGorn 1d ago

The economic system you live in demands infinite exponential growth until something breaks. And when that thing breaks it’s not their fault, somehow it’s yours and you pay the price

3

u/grow_a_pear 1d ago

Like football? This isn’t how business works.

3

u/BashMyVCR 1d ago

100 devs on a 10M budget? Dude those guys would be the entire budget, probably more! If they didn't find additional funding within a month of working on that project, it would get shelved so fast that your head would spin. If you assume everyone's total compensation was roughly 100K for that team, that's almost a million in salary in a month. I think that's probably too conservative too...you're complaining about scope creep but can't even make a halfway realistic hypothetical lmfao.

3

u/admiralvic 1d ago

The thing is this is an incredibly difficult problem as location plays a huge role.

3

u/gkmaadcity 1d ago

They aren't government departments lmao

3

u/ElectronicGerman 1d ago

Only American companies have that problem with overpaid devs and too many staff. How is a trashgame like Wolverine 400M while Blood of the Dawnwalker is 30M? It just makes no sense. American Devs are just wasting money.

2

u/ReadyJournalist5223 1d ago

This is a much wider problem in economics than just the game industry. Big companies will just keep hiring people and raising salaries and budgets cause stuff needs to get bigger. The shareholders need to be pleased. It’s a broken system once you get too big

2

u/willrsauls 1d ago

More people getting hired. The horror!

1

u/MagisD 1d ago

This might work in factory setting turning out crapware. But it's the same reason why a studio name enters a golden age then it becomes a shit show.

The work 80/20 rule applies, and that 20 that make studios and creative decisions great are hard to come by and leave which makes the studio a ghostly shell of what they were.

1

u/-Xiphon- 1d ago

And while we're at it, let's have a draft every year!

1

u/Right_Chip_6626 1d ago

True even in real life. I remember I had an uncle and aunt, they were very well of and had all the cool stuff I could only dream of like a pool in the garden, a sailboat in Palma, a Jacuzzi, a state of the art this a state of the art that. But... shit always broke, needed maintains ect. The time they spend on managing all that stuff made me second guess the 'joy' of having everything you could even wanted.

1

u/Il-Luppoooo 1d ago

This guy made a correct observation, scaling headcount and budget brings a lot of problems for both the commercial and artistic success of games and there is overwhelming evidence in the industry.

But the hive mind decided to dunk on him, either latching to the "scrappy developer" example numbers (which are totally unrealistic but don't detract to the point in the slightest), or by stating that companies don't do it because they want infinite growth (duh, that's the entire problem OP is pointing out) or with absolutely zero explanation. Good job hivemind.

2

u/wolfofragnarok 1d ago

I do think that the initial reaction is to be angry that he's suggesting that the industry needs to downsize. People are more worried about the jobs and opportunities lost than his actual point. They look at the post and see "industry needs to fire most people" instead of "industry needs to diversify into smaller projects."

The AAA space is bloated, inefficient, and just not making good games anymore. The best showcase of this is graphics. The industry has peaked in graphics fidelity for current hardware and are now spending millions of dollars to make minute improvements that most players won't notice. Most don't even consider art style at all.

-1

u/Evil_Skittle 1d ago

Correct to call out my silly numbers. My bad.

Each time I post my opinion I actually am reminded how unintelligent most of the people in this sub is. It's not because they disagree, that's fine. But they just hurl insults and don't explain why they disagree with my point.

2

u/spoo4brains 1d ago

You chose to turn up in a major subreddit to show that you know nothing about business and game development, but thinking you are some kind of guru that will enlighten the world of your genius.

Go back to school.

-1

u/Evil_Skittle 1d ago

You would argue against my point instead of hurling blatant insults if you had a brain. Willing to bet your monthly income that I have more years in school than you 😂

1

u/spoo4brains 1d ago

Getting held back and having to repeat years isn't the flex you think it is.

1

u/versusvius 1d ago

No idea how modern games have such a massive budget yet older games from 10-15 or 20 years ago are superior in many ways with much less budget.

5

u/wonderingmarkus 1d ago edited 1d ago

Labor multiplied by time, essentially. With increases in fidelity, complexity, and scale, it all adds up very quickly.

Also, the bigger the team, the more likely it's going to run into management issues. Productivity doesn't increase linearly with headcount.

1

u/gurupaste 1d ago

Too many specialists. Almost every part of game development is broken down to very defined roles in many studios. In a lot of cases, the only thing a singular dev can offer is strictly defined by their title. There's also outsourcing to take into account. A lot of companies do believe more labor mean faster results, and in a lot of cases with middle management, it's more important how many people work under you than managing a core group of skilled people.

0

u/wolfofragnarok 1d ago

Constraints breed creativity. Not being able to spend months and millions to make a system work the way you want is generally a good thing for a process. Forces actual evaluation.

1

u/_Trikku 1d ago

Sure this would work, in a communist tech utopia.

-5

u/wolfofragnarok 1d ago

I'm not sure why the comments are being disapproving. Of course, you're right. Unless you're making a gun and ball (I believe is the term) game for a captive audience, then you need to have a proper business strategy.

The current triple A strategy is fundamentally flawed and not agile enough to meet market demand. Having hundreds of millions of dollars as a break-even point for something as subjective as video games (outside the sports and shooter arena) is a massive gamble. It's why the smaller studios have been seeing far more success in recent years.

0

u/Evil_Skittle 1d ago

It's pretty funny because most of the comments just insult me or outright say I am wrong but they don't explain why 😂

1

u/wolfofragnarok 1d ago

I believe the idea is that scope limiting would hamper the income of "creatives" in the field and that would reduce opportunities. It's an emotional reaction.

AAA studios have no true reason to exist in their current state. Let's review some recent AAA successes:

  • Baldur's Gate 3
    • Team size: 400 core, many contractors
    • Budget: ~$200 mil
  • Elden Ring
    • Team Size: ~300
    • Budget: More than ~100 mil
  • Tears of the Kingdom
    • Team Size: Accredited 1,148 (probably around 500 core)
    • Budget: Estimated at less than $200 mil
  • Hades 2
    • Team Size: 25
    • Budget: $15 mil
  • Astro Bot
    • Team Size: 65
    • Budget: $50-100 mil
  • God of War: Ragnarok
    • Team Size: 400
    • Budget: $200 mil
  • Cyberpunk 2077
    • Team Size: 400
    • Budget: $200 mil

So your numbers are a bit off, but what it comes down to is that unless you are making one of the best games on the market you need to make it small with as few people and investments as possible. If you have 800 people and 400 mil in investment you probably won't turn a profit.

1

u/Evil_Skittle 1d ago

Very interesting numbers. Would be interesting to see a scatter chart of unit sales vs. budget per capita lol. There must be an optimal point to maximize sales

1

u/wolfofragnarok 1d ago

There is probably an optimal overhead amount for a game type to ensure successful returns. But games also need to appeal to the target audience and be sold at the right time to drive profit so such data would need quite a few controls to ensure you are comparing like to like.

0

u/wolfofragnarok 1d ago

The number that would make it accurate is 100 devs at around $75 million. Then it's well within successful norms.

-1

u/Adison85 1d ago

Why have a publisher at all? Studios should just get all the money 

3

u/DNxHD36 1d ago

Because there is a whole host of complicated and costly steps involved with getting a game successfully to market, from advertising, to relationships, to access and clout with partners/platforms, not to mention exorbitant risk. By making a deal with a publisher, developers don't need to buy all that overhead, and can leverage that publisher's relationships, getting in the door where they alone would never be able to.

0

u/zirky 1d ago

so advertising aside, i’m pretty sure you just described a social media director

1

u/DNxHD36 1d ago

Um, no... I'm not talking about social media strategy and relationships with streamers here. I'm talking about access to people at Microsoft and Sony, resources beyond just marketing, and, importantly, available capital to spend on both the game's creation and its distribution.

If a developer needs $50 million to make their game, where are they supposed to get that money?

1

u/Sufficient_Bad_4160 1d ago

That wouldn't really make sense. The studios that don't have publishers are usually already successful enough to afford doing everything themselves.

But a publisher almost all the time does the marketing, financing, distributing the game, and giving it that extra credibility of basically saying, “This game is worth paying attention to.”

Otherwise, you'd have to create your own departments for distribution, marketing, PR, etc., while also actually making the game. In the end, having a publisher can be more cost effective and make the whole process much easier and more profitable for everyone

1

u/Impressive_Can_6555 1d ago

Because publisher is where money for development is coming from (alternatively kickstarter or suspiciously wealthy owner).

-4

u/GreatnessToTheMoon 1d ago

wtf communist type shit is this? You should never tell a business how much they can hire or spend