Video game developers set for cash influx as tech firms compete for deals

  • 4/11/2022
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Video game developers are champing at the bit ahead of an influx of money from some of the biggest technology companies in the world as they compete to build a “Netflix for games”. At the centre of the contest are Microsoft and Sony, followed by less gaming-centric companies such as Apple, Amazon and Netflix who have all launched subscription services in an attempt to entice gamers on to their platforms. Microsoft has spent four years building up its flagship subscription, Xbox Game Pass, which offers unlimited access to more than 100 games for its Xbox family of consoles for a £10.99 monthly fee. In March, Sony announced plans to compete directly with Game Pass with a raft of changes to its PlayStation Plus service, which will eventually launch with 700 titles for £13.49 a month (or £99.99 a year), though largely focused on older titles. Alongside the two console manufacturers, a host of companies have launched similar services. Apple Arcade, for the iPhone and Apple TV, offers unlimited access to 200-plus mobile games for £4.99 a month; Amazon’s Luna service, currently in early access in the US, lets subscribers stream 100 games for $5.99; and Netflix is experimenting with offering a selection of games for free alongside its movies and TV shows. The competition has resulted in an influx of cash to the industry. Microsoft, the second richest company in the world, has been on an acquisition spree, buying the Call of Duty and Warcraft publisher Activision Blizzard, the Skyrim developer Bethesda and nine independent studios since 2017 alone. Amazon and Apple, the fourth and first richest companies in the world, have similarly deep pockets. Sony, with a market cap an order of magnitude smaller than the tech titans, has struggled to keep up, merging with the Halo and Destiny developer Bungie earlier this year. Even those who have stayed independent have welcomed the new model, in which game developers paid a significant sum upfront to put their games on the services, greatly reducing the risk of launching a new title on to digital storefronts where it can sink without a trace. “For a lot of actual indie developers, someone that is self-publishing a game by themselves, the chance of making it as a success by just putting it out there is pretty low,” says Tom Davis, of the Swedish indie publisher Thunderful. “By being able to actually get your game in front of the 25 million people that are subscribed to something like Game Pass or this new PlayStation Plus thing, it actually benefits sales as well – because people are just generally talking about the game.” Tom Mead, an art director and co-founder of Bristol-based Spiral Circus, says the deals with the platforms are “actually quite a positive thing, because it means that you can be paid properly to develop the ideas that you want, without necessarily having to worry about whether your game sells a bunch of copies at the end of it.” There’s widespread hope too that the rise of subscription services will usher in a change in focus for the industry, away from multimillion-dollar AAA titles towards smaller quirkier titles that aren’t intended to gel with everyone in the world. “Look back at Blockbuster,” says a producer at a major publisher who asked not to be named because of the commercial sensitivity of their dealings with the platforms. “I would go to Blockbuster on a Friday, not even knowing what games are out there, to look at a bunch of physical games and pick one up for the weekend. With Game Pass, everyone’s just picking everything up, and they might only play it for a few minutes, but they’ve got the option to see if it’s for them.” There are fears for the future, too. One developer who left a Silicon Valley giant to go independent says they’re worried about what happens when Sony’s money runs out. “It’s working while they’re struggling for platform dominance,” they say – but if one platform wins the fight, could payments to developers be cut even as subscription fees get increased? But even those with little to gain from the model agree it’s currently working for gamers. Super Rare Games is a British company that sells physical copies of previously download-only titles, and Ryan Brown, the company’s “head of words”, argues that the two approaches can coexist. “I use those services, they’re undeniably incredibly convenient. But for the people that feel like it, myself included, there are games that they’re going to want to be able to play in 50 years’ time, and that’s what physical games in general provide: ownership that you can’t have with a subscription.”

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