How Profitable Are Indie Games?

[Epifire]

Well simply put, if you and a small team build and release a successful Indie game on Steam and sell say... 10,000 copies for 15.00 bucks a copy on steam, how much of that is actual cash that goes to the team?

It seemed simple when I thought about it, but I don't know how much of a chunk Valve/Steam gets as well as other engine licences and so on. I would think since the team would be small they would actually make a good amount off the sale of a game like that for a team that small. But hey that's why I ask the question.

[zombie@computer]

It depends... Valve does not show 'we want 10%' on any of their Steam sites because it depends on the game. I suppose they'll ask less from indie developers and more from larger developers, but that's just guessing. 5%? 10%? 20%?

As for engine licences, these are usually fixed or dependent on the game, not the amount of developers. Costs range from 100's to 10.000's. Here's a snippet i found on wikipedia about the udk: "According to the current EULA, game developers can sell their games by paying Epic the cost of $99 USD, and 25% royalty on UDK related revenue from all UDK-based games or commercial applications above US$50,000". I assume other engines, like source, have similar (though not disclosed) figures.

In any case, its easier to make a profit with a smaller team. Less hands to fill you know.

[Epifire]

It depends... Valve does not show 'we want 10%' on any of their Steam sites because it depends on the game. I suppose they'll ask less from indie developers and more from larger developers, but that's just guessing. 5%? 10%? 20%?

As for engine licences, these are usually fixed or dependent on the game, not the amount of developers. Costs range from 100's to 10.000's. Here's a snippet i found on wikipedia about the udk: "According to the current EULA, game developers can sell their games by paying Epic the cost of $99 USD, and 25% royalty on UDK related revenue from all UDK-based games or commercial applications above US$50,000". I assume other engines, like source, have similar (though not disclosed) figures.

In any case, its easier to make a profit with a smaller team. Less hands to fill you know.

So in this case a small team could literally (figuratively speaking of course) be rich overnight if a game of theirs happened to be very successful? I mean I would not go into this business looking to become a millionaire, but the actual logic behind it seems to point that as a possibility to a team that really hit it off well. I have been thinking Indie Developing seems like a more increasingly valid path to take, given the combination of Steam and small teams.

[MaK]

It a lot harder to make a game than you think. A good one at that.

[Epifire]

It a lot harder to make a game than you think. A good one at that.

Hey I wasn't saying it was going to be an easy venture. Gosh look at NS2. Those guys did awesome and they were really pushing for that one but all the effort of theirs payed off. It nearly bombed out they said since it was such a big and ambitious project.

Yeah I am talking going Indie likely in like four years, but even that is pushing it. Still gotta graduate and all that Jazz so yeah. I got my sights on building games but Indie development just seems like the way to go for me.

[Armageddon]

It a lot harder to make a game than you think. A good one at that.

Hey I wasn't saying it was going to be an easy venture. Gosh look at NS2. Those guys did awesome but they were really pushing for that one but all the effort of theirs payed off. It nearly bombed out they said since it was such a big and ambitious project.

Yeah I am talking going Indie likely in like four years, but even that is pushing it. Still gotta graduate and all that Jazz so yeah. I still got my sights on building games but Indie development just seems like the way to go for me.

Read this. Making games by yourself is hard, and it takes a lot of skill and sacrifice. I know the point you are when you're just starting out, everyday you have these ideas for games or ideas to go commercial and make lots of money. But games don't come out of thin air, they take a lot of hard work and usually an idea will only entertain you for so long before you actually have to work. You have to decide if you can spend the next four years looking at this same game every day. For now you should just write down the ideas you have and drop them in a text file, focus on your mod at the moment since you seem to be pretty dedicated to that. I don't think you really understand what makes most indie games special, it's about trying something new that has never been done, to give someone and experience they have never had. Indie developers do it because they want to see how people interact with their games, and because games are awesome. Go on TIGSource and see all the amazing free Indie games they have, any of them could have gone commercial but they made it because they wanted to, and they want as many people as possible to play their games and their hard work. I'm not trying to be harsh or bring down your dream, I was was where you are, wanting to make an indie game. I'm just telling you the truth, it's very hard and you'll probably fail the first fifty times, but the fifty-first game but just be a success.

[Epifire]

I am touched. Really I am, cause I actually was not expecting some one to have such an in depth view on this.

Honestly there isn't much else I see myself doing in the coming years unless I suddenly decided to take some rambling leap into music as some sort of effort in a career. I would say other then raw knowledge and ideas, I have determination and the passion for building games. So even though there are a lot of areas that do not seem to fit in all at once for a project, I end up searching out alternatives to an end. Whether it be completely revising a lighting structure for the game, or completely re-routing a story. I have already been experiencing just some of that frustration. I don't think I have this illusion of a grand and easy trip through developing a game, because as I see it, there is always the unforeseen and a lot of work involved to work around problems. To me I see myself working through an Indie project without getting paid, and having to work a regular job just to stay afloat. I see it as the grand sacrifice to achieve the goal of accomplishing that dream.

Done a good bit of reading for the guys who have gone on before me, and in short, they tell me it's Hell and that you should really know what you want before taking up something so massive. As I would sum it up, I get the impression of something along these lines...

-It's very frustrating.
-It's very time consuming.
-It takes every ounce of what you got to work it out.
-It's a mistake to do just for the money.
-It's all worth it if you love what you do, and love to see people play and enjoy your work.

For now I seek to do the best job I can in the back-story mod I currently work in. Not only to establish a good reputation, but also to learn as much as I can for the coming years. So I guess that sums up how I feel and where I stand in this. Thanks for taking the time to reply though.

[Smurftyours]

The American dream is dead.

[nub]

In my opinion, it shouldn't be called the American dream. It should be called Your dream.

My ultimate dream career was to work at Valve, but I've slowly grown out of game design; as much as it kills me to say that. I literally get choked up at times just thinking about it.

But once you start to experience other things in life, you start to realize how much more there is to see and learn other than game design, then you really start to figure out what you want most in your life. For me, it's boiled down to simply settling down with a nice girl and living a comfortable life. And as far as a career goes, I'll probably end up somewhere in IT or doing something with computers.

So in other words, don't rush things. Just try to experience as much as possible so you can broaden your perspective on life. Only then will you know what you truly want to do.

[MaK]

Nub that was beautiful.

[Armageddon]

I need to paragraph better.

[nub]

Nub that was beautiful.

I have my moments I guess...

I need to paragraph better.

As far as posting on forums goes, I just paragraph based on my thoughts. When one thought leads to another, I usually split them in to paragraphs.

For instance, what I literally just typed above gave me the idea to start this new paragraph to explain my point a little better. However, to call this a paragraph is a bit inaccurate since it's only two sentences long.

[Dr. Delta]

Well simply put, if you and a small team build and release a successful Indie game on Steam and sell say... 10,000 copies for 15.00 bucks a copy on steam, how much of that is actual cash that goes to the team?

It seemed simple when I thought about it, but I don't know how much of a chunk Valve/Steam gets as well as other engine licences and so on. I would think since the team would be small they would actually make a good amount off the sale of a game like that for a team that small. But hey that's why I ask the question.

Valve takes something like 30% for Steam, so those 15,- becomes ~10; 10.000 × 10 = 100.000, license fees for source, depending on the project go as low as 50.000 (lowest I've heard fee on a source project I've heard so-far). You'll need a lawyer, found a company, etc. rough guess: anywhere from 500 - 5.000(?). You need a corporate bank account, also not free, let's say 200$ per year. Licenses for other application you'll be using: 20$ per month for Adobe Cloud per application, Max/Maya: 3700$ per license, Zbrush: 700$. Though there are cheaper or free options, they may however not be your preferred tools. Then there's project files, you'll need some server somewhere for SVN or dropbox: something like 20$ per month or 100$ per year per dropbox user. And then of course you assume someone can make a website, and you can do audio/voice acting and everything! else in-house.

Concluded, if you sell your game for 15$ on steam, takes 2 year to make, do everything in-house and sell 10.000 copies, you'll make very roughly something like 55.000-60.000$ of costs. So 45.000-40.000$ of profit. So divided by 3 (programmer, design guy, graphical guy) you would make 15.000-13.333 IF you leave nothing in the company. Typically you leave something like 10-20% in the company for the future.

my 2 cents/guesses/whatever

[Sathor]

Which would not be profitable at all.

So the numbers are wrong. You didn't pay any taxes on the 45.000 yet, either. And for example, in Germany, I think you'd pay at least like 40% on taxes, insurance and the rest.
Although, with such a low income (of independent work), I guess you wouldnt even need to pay taxes ...

Anyway, you'd have to have money to live off while developing the game, too.

Crowd-funding is today a variant of course, but for that, you have to have a really good project, even in the early stages ...

[Text_Fish]

Developing an indie game is a bloody hard slog. I'm doing it at the moment. We just missed our first deadline of Halloween and have penciled in a Christmas deadline instead. It's not an overly ambitious project, but we aim to give the player an entertaining experience in an old-skool sort of way. We have absolutely no idea how much money we'll take, which is one of the reasons we decided "fuck it, let's just make the damn game and see what happens".

We're a 3-man team, though you could say it's more like 1.3 as two of us have full-time day-jobs. Luckily our friend has experience as a freelance programmer so he's very good at managing his time, and limited income from previous software projects. We use Unity engine, and free tools such as Blender and GIMP, so our costs (not including "time=money" or beer for meetings) have yet to exceed £50.

If the game is a commercial success we'll be minted, but all we're actually aiming for is the first rung of a very tall ladder.

[Edit: Forgot to mention business costs and distribution. We're distributing from our own website first, and business costs (setting up an official business name etc.) will be paid from whatever profit we make at release.]