16 April, 2007
I saw an interesting post over on MOGBlog entitled, Wanted: Two Million Dollars. It's an interesting post about what it would take to make a small project, and the conclusion is that you could do it fairly inexpensively. If you could fit the project into 2 years, the post says, you could do it for under $2M.
Note: I'm not saying that you cannot make a game cheaper than this. Rather, I'm pointing out some of the missing expenses from the post I linked above. You can make a game for much cheaper, and several people have. But, if you want to hire 14 people and pay them the salaries listed, you will end up spending more even if you don't hire anyone else. A true "indie" game will have a few underpaid and overworked developers that are doing multiple jobs simultaneously.
So, as much as I like such a can-do attitude, I have to show some gentle corrections in the figures.
First, a snark. a game is still "massive" if you don't have millions of players. The original definition usually indicates that the number was supposed to be in the triple digits. That means if you attract over 100 players, you qualify as "massive" enough. You still have to worry about issues like customer service, maintaining servers, etc, whether you're dealing with 1,000 players or 1,000,000 players.
Now, I'm going to consider this from a U.S.-centric position. Your milage may vary in other countries, or even other states. :)
$300k is probably enough to handle most of the other other costs. We spend about $200/month for website, bandwidth, and co-location after buying a used 1U server for Meridian 59. A project like this will probably spend a bit more than we do, but if you're making a modest-sized game you can probably get away with about $1000/month in hosting during development and closed testing. You'll probably need one of your programmer-types to also do IT support for your servers, and expect the other people to be smart enough to fix their own computers if things break. And, bandwidth during launch can get pricey if you don't want to have the same experience as every other MMO on launch day.
For work hardware, you don't need cutting-edge machines, so get some reasonable machines in bulk. If you're smart, you might be able to get a good discount (or even free equipment) if you agree to put some logos on your website or in the game. You don't see the "NVIDIA: The way it's meant to be played!" screens in games because the developers think NVIDIA needs free advertising! ;) But, it might be hard to get serious attention from these people if you're a small-scale developer.
If I were planning this size of a project, I wouldn't have a tech lead. I'd hire 3 competent, self-motivated programmers: a client programmer, a server programmer, and a network/tools programmer. I'd split up your budget between them and give them $80k each. This will be a lot of work per person, though, especially if you don't license any engines. Also, this means you can't expect a cutting-edge 3D client with an infinitely scalable server technology.
For the artists, you might want to consider more outsourcing. You can get a fair amount of art out of a Chinese (or Eastern European) outsourcing company. You can't eliminate the whole art department, because you'll still need artists on your side to ensure the deliverables are what you need and to fix up the inevitable problems that would take too long to have the outsourced company fix.
For designers, I'd probably look for people that could do light programming/scripting and level layout. This might raise the prices a bit, depending on who you can find. Remember that you're going to be doing a lot of content, which could be a sizable amount of work for just 5 people. In addition, be careful with Junior Designer! They may come cheaper, but they will require more training and investment; this could overwork your full-time designers in this type of project. But, you might find a brilliant designer in the rough.
You're probably overpaying your leads for this type of project. I think the art and design leads would be happy with $80k given the relative salaries. Making double seems a bit excessive for an indie project. Salary figures will be shared eventually, and paying the leads so much more might create a bit of resentment with the other people. And, as I mentioned with the programmers, you're probably better off not having a lead and just having self-motivated workers that are in charge of a specific area.
But, here comes the bad news: You have a lot more costs to consider.
This list is missing a QA team. You'll want at least one internal tester to do quick turnaround testing on your stuff. Let's face it, we tech guys sometimes suck at testing our own stuff. Some days we're happy when it just compiles. :) If you're working with a publisher, you can get some more testing resources from them, but if you're staying lean and mean you have to figure on paying for more people. Especially when it comes to compatibility testing! With Vista out but some people clinging stubbornly to XP (and even some 2k holdouts!), you have to make sure your game runs on a variety of configurations. Your programmers will not have the time to do this.
You might want to hire on someone to focus on the business side of things full-time. It can be a lot of work dealing with tax paperwork, getting feedback from the lawyer, etc. Ideally, this person would also have project management experience to keep things running on schedule and on budget. The could also fill in other areas as needed, such as rounding up external testers, proofreading text, etc., during the lulls in their work. Figure another $80k-100k salary if you want quality here, and you do. ;) The challenge is to find someone competent that won't use their position as "the biz guy" to try to dictate design. If you plan on filling this role, don't expect to be able to lead the design, too, otherwise you'll get overworked and something will get ignored.
When paying all these people, you need to handle payroll taxes, which means you'll need to add about 10-20% on top of the salaries for the company's obligations. Want to offer benefits like health insurance? That'll be additional costs. The rule of thumb is that you'll add another 50% for taxes and benefits on top of salary. So, the base rate of $850k/year burn in the post now becomes about $1.25M if you want benefits.
You'll need an accountant and lawyer to handle some of the basics. If you don't want to overwork someone with bookkeeping, that'll be a significant cost to have a bookkeeper. You'll want a lawyer to at least look over your EULA, etc, and review any major contracts, such as hiring agreements, founder's agreements, etc. You will also be served by filing some simple IP protection, such as trademarks on your important properties. And, if you're not renting offices and have employees in different states, you'll want a payroll company to avoid the headaches of too much paperwork. All this stuff is not super-expensive, but it quickly adds up.
Finally, this includes no marketing/PR budget. This doesn't have to be a lot, but you should still get someone to do the basics. The cheapest thing to do is to contract a good PR person to help you write and send out press releases to announce your game and organize press contacts to get the word out about your game. There's a great chapter on PR in a certain book I'm familiar with. ;) Your biz person might be able to pick up some of the slack on this side, too, by organizing the screenshots to send out, etc., if they aren't overworked already.
Depressingly, I've pushed the cost of this project way beyond the $2M goal. You're probably looking at least at $3M, if not $3.5M for this type of project. You might be able to cut some of the cost if you lower salaries but offer a well-defined profit-sharing program for your employees. I know I would be willing to work for less if I could get some percentage points on the back end. But, you have to figure this into your operating costs.
Unfortunately, it's easy to overlook these costs. The biggest surprise is usually when people forget the payroll taxes. If you've never run a company before and had to do payroll, it's very easy to overlook.
Hopefully this helps people avoid getting into a mess. :)
Edit: I adjusted the tax rate figures above. My tax rate estimates were way too high. Also added the note in the second paragraph above since people seem to be think that I am advocating that this is the cheapest you can possibly make a game for.