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I used to work for big game studios in the bay area, and changed careers to big tech because of this.
Games don't bring in enough revenue to sustain employees in high-cost-of-living areas ($7B revenue for EA versus $305B for Google in 2023). From the business perspective it doesn't make sense for a game company to pay SF Bay Area tech salaries when it's making so much less revenue, so the result is more and more game development shifts overseas.
Then from the employee perspective, it's already a brutal nights-and-weekends industry. "Crunch time" is normal. If you add to that poor relative pay for where you live, it's just not worth it anymore to chase a dream you once had as a kid.
I personally am much more satisfied with my life as a result of the shift. But it is a sad trend for the US.
As a consumer, how can I ethically purchase games in such a way that the developers can have a good life?
This is a very kind question. The long answer is I'm not sure. Crunch time is driven by the fact that making games is one of the coolest businesses you could be in, which means everyone wants to do it. Supply is overwhelming against limited demand and it's winner-take-most. There are hundreds of games released every day.
In that environment, who rises to the top? It's the studios who are willing to make it their life's purpose to make the best game possible, which means 70+ hour weeks. What they produce is awe inspiring but it's a sweatshop.
I literally interviewed once at a game studio that told me, "You will not do well here if you have a family." Kudos to them for being upfront about it. A friend who took their offer told me they expected him to work Thanksgiving and Christmas day.
Look into the business practices of the companies that make the games and refuse to support those which perpetuate problems (looking at you Blizzard Activision).
you can hire a personal at-home game developer that serves you fresh never-frozen artisanal games every week.
you can't, to be frank. As a TL;DR: don't worry about saving the AAA or even AA productions. The biggest impact you can have is to buy indie games. And not just the few popular ones, really look into your favorite genre and seek out some solo/small team gems to pursue. Your $5-20 will go much much further there than $70 for any AAA GaaS. If comfortable, try to avoid Steam in lieu of other platforms so those platforms have a chance to flourish, since it'll let them grow and most other platforms take a much smaller cut than Steam; your dollar goes much further for devs on something like Itch.io, for example.
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Look at the level of scale between EA (who's about as far on the "unethical scale" as you can get) and even mid-tier tech companies. There's just too much money in factors like ads to ever bridge that gap with "just good games". That's why mobile makes more money than console/PC. There just aren't enough of the latter to support an entire studio whlie expecting each devs to have cushy 6 figure salaries.
more napkin math: for a $60 game, every $100k/yr dev would need 2000 sales a year to break even on their labor. multiply it by 100* and that's 200k sales a year. add in platform cuts and health care and we're easily breaking 400k sales a year for this break even point. and of course we're talking about 4-5 years cycles of no game revenue, so you need 2m sales just to pay back the initial dev cost.
There's simply no "ethical" way to reliable hit those kinds of figures. So outside of "making a good game", the "ehitcal" choices are:
1. Make games more expensive
2. Reduce platform cuts
3. Make games faster (aka, smaller and/or leaner, if we're talking ethically)
4. Reduce costs of living (which can help justify lower dev salaries since they have less expenses)
1) already happened with the $70 price increase, and that's still irritating to gamers despite being a mere 16% increase after 16 years (an increase that doesn't even keep up with inflation). 2) happens behind closed doors all the time with platform holders so that does help alleviate some of the sales needs. 3) isn't popular in AAA productions but a few (like Obsidian, in this article) do employ this strategy of making smaller games between the big releases. 4) is basically a pipedream that's far outside the industry, unless the industry starts hiring in lower CoL areas.
But some of these do imply some grey area solutions:
5. make games with less people
6. make studios located in cheaper areas
5) is basically trying to happen right now with the same elephant in the room as the rest of tech: AI. Generative AI in the case of games. This can be exciting, but the way early adoption has happened so far isn't much better than all the lawsuits being brought forth due to OpenAI's reckless abandonment. Companies don't want to streamline their current talent, they want to replace them, and that only spells bad news if you don't like the current slop out there right now. It will get a lot worse before it gets better, and I can only hope that when the dust settles that there's at least some proper attribution solution (at a moral minimum, there'd be some sort of kickback/residual based on what the AI prompt sources to generate. But that's far from certain).
6) is the same. A great opportunity to not have this industry turn into Hollywood by expanding and nurturing talent nationwide or globally. But they aren't giving modest wages to lower CoL states, they are using it to drive costs down to salaries that high CoL states would barely be able to live on. There's
So yeah, it's a lost cause beyond the fault of even the industry, let alone a single gamer. But 5) does have a healthy caveat: actually smaller but more tightly made games. AKA indie teams or studios. 1m sales may be a bust for a AAA title these days, but it'd be absolutely life changing for a team of 5-10 devs staying lean. So take some steps to at least explore your favorite genres past the most popular releases. Support smaller teams whose individual sale goes a lot further (even $5 for a team of 10 is a more money than $70 for a team of 500. And the former doesn't usually ask for more money unless it's a decent expansion). Follow their feeds and wishlist and comment about your excitement for interesting upcoming indies. You can't help everyone, but collectively more attention and demand to indie productions would at worst show a path as a side hustle for more potential developers.
And as a maybe controversial piece of advice: try looking outside Steam as well. Steam has had a bit of an unhealthy counter effect as of late on indies, and their strategies make it clear that they are focusing on relieving AAA studios of platform cuts instead of smaller game. Basically the reverse model of what unity/unreal engine do with their compensation schemes. Many games are on Steam only, but it's another note of consideration that can put more money in an indie's hand. Itch IO has a "choose your own cut model" and its default cut is only 10%. GOG still has a 30% cut but they offer (or at least, used to) offer a few other payment options.
*(so a sizeable but still "small studio", compared to the hundreds in a AAA title. I believe Destiny 2 had at least 600 devs on boat at one point)
I'm in the trenches. Making games is amazing, but the business is brutal. Very hard to find a "geyser of money" and monopolize it for years let alone decades. Contrast with Google search or Microsoft Office, etc. The tech advances quickly, dating past work. One fad gives way to the next. There's a fixed amount of attention for an ever growing amount of content. etc. etc.
Meanwhile, the technical work is very sophisticated and game engineers can work elsewhere, so they justifiably want to be paid well or they will leave to adjacent industries. Plus life is expensive in America. Six figure salary ain't what it used to be. People overseas, including western Europe, will do comparable work for peanuts. Article basically gets it correct. Not sure the problem can be solved. Joe in Seattle wants $150,000. Jozef in Poland wants $50,000. Case closed.
Still, I'm grateful to get to make games with cool people every day. Carpe diem!
Company I am at is also employing Jozef in Poland and has resulted in a company with 5 or 6 US engineers and 45 engineers in Poland.
How many state side engineers are the 45 Polish engineers replacing? Also, are they willing to put up with game studio industry bs?
The article sort of answers this. There are so many other opportunities in the US that pay better (and have a saner lifestyle) for many of the same skill sets.
There was some grumbling a few years ago that game engine devs were hard to retain because they keep getting pulled away by FAANG cash to optimize servers. I did game engines for a long time. Now I optimize robots.
Exactly. Other parts of the US economy (tech giants) have grown much faster than the games industry. A UX designer at Apple makes multiples of a UX designer at Blizzard.
Star Trek Online is an aging MMO that still receives regular updates and generates regular income thanks to a built-in fanbase. Obviously, it's not wildly profitable but Cryptic, the studio running it, has been getting by. They're based in California, so their salaries are high by world standards.
Earlier this year, a firm named "Embracer Group" bought up a whole bunch of studios, including Cryptic. Their approach was to create a new studio headquartered in Berlin that uses remote workers living in cheaper areas of the globe. They're having Cryptic train their replacements at the new company before they are, in turn, laid off.
Long story short, the business types believe that software developers are a fungible commodity and see no difference between a home-working Mumbai developer and someone living in Silicon valley, except for what they must be paid.
Only time will tell if this view will result in bigger profits or the death of everything firms like Embracer Group touch.
It is more expensive to do anything in the USA. This did not matter in the past, because US consumers also had vastly more disposble income. Now, however, nobody has any disposable income.
Adjusted for inflation, SNES games cost over $100. Now games are 100x larger in terms of content, and while the market has increased, the price is halved at best. $100 got you a game made by 1 or two people. Now $50 gets you a game with a thirty minutes credits roll. Microsoft and Sony offer games for a monthly price, and budget consumers buy games used - such that GameStop captures the additional value.
In 2000 I was paid just over $100k as a game developer. Adjusted for inflation that's $182k. I'd be almost tempted to go back if someone could pay that much, reliably. They don't pay that much and they certainly aren't reliable.
Underlying it all is that the USA is no longer the only industrialized nation in the world, as it once was after everywhere else was bombed flat. So just as countless TV shows are made in Canada and elsewhere, so too games can be made elsewhere.
It's not impossible today to make that much in games. 2022 I was making 160k at a startup and probably had way less YOE than you back in the day. Main thing is that you give up any stock compensation, so you'll still take a hit in total comp compared to traditional tech.
Holy cow. Were you an engineer?
Every time this topic comes up I point to the fact that the television industry makes gigantic volumes of content, reasonably on-schedule and on-budget. Movies have somewhat different math, but there's a huge economic segment routinely producing creative content with a high proportion of salary expenses, much of which is unionized.
It seems crazy to discuss gamer salaries without discussing how normally dysfunctional game studios are, with crunch time all year round, intense burnout of young employees, terrible working conditions, and rarely hitting schedule or budget constraints. In other words, there's a huge opportunity cost in reforming the process by which studios make games, and all they need to do is look at TV to see how to do it. Hell, just hiring some television producers would probably bring a level of sanity as-yet-unseen.
Part of what drives high salaries in gaming is the terrible working conditions. You could pay less just by saying "we work 9 to 5 and value quality of life."
> Every time this topic comes up I point to the fact that the television industry makes gigantic volumes of content, reasonably on-schedule and on-budget. Movies have somewhat different math, but there's a huge economic segment routinely producing creative content with a high proportion of salary expenses, much of which is unionized.
TV and movies are produced by people who understand storytelling. This is something that has been discussed in the game dev industry ever since the arrival of CD-ROMs. Suddenly, free of the constraints of floppy disks, devs thought they could create huge fantastic worlds to roam in. They sure did, but they have lost the plot. CD-ROM and then DVDs removed one of important constraints that forced creativity; cheap 24bit 3d cards removed another. And yet, one of the most fun games in recent history is Minecraft, a game that does not need gigabytes of textures or fancy 3d hardware.
>It seems crazy to discuss gamer salaries without discussing how normally dysfunctional game studios are
Some oft quoted statistic states that the average game dev is in industry for 5 years. The churn is insane and it doesn't surprise me that there's a lot of chaos slowing matters down. This is sadly a common thing across all of America, but it may hit creative endeavors working in cutting edge tech even harder. Some non-tech office working on crud and IT can probably operate for years, decades before its too late. A bad release can tank a studio right there.
As a contrast, look at Nintendo. an absolutely unthinkable (for America) 97% retention rate. IIRC 4 of the 6 people who worked on the original 1980 Super Mario worked on the 2023 Mario Wonder. They may have a few delays but only in crazy circumstance and very rarely a significant one once they lock in (Animal crossing is the biggest example). On the contrary, They pushed up Xenoblade Chronicles 3 a few months, meaning they had a game either ahead of schedule or sitting and waiting to release (again, unthinkable seeing western studios). They are far from perfect (their Western branches more r less work the same way as any other), but it's clear that their investment in talent has given them a portfolio and reputation that has endured decades.
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Anyways, I'm not a producer, so I don't have the answers on how to fix this. My only recourse is to setup a structure to make my own games, and make as complete a game as I can before recruiting a few (and only a few) hands to get it across the finish line. Smaller staff means lower bars to success, recruiting late means there's not much creative clashing on what/how the game plays. a focus on shipping over vast scales and maintaining a service.
I would love to hear more concrete recommendations or reading. It's an interesting hypothesis! That said I am a bit skeptical given the game industry has failed to sort this out for several decades... perhaps it's simply ignorance but occam's razor has me thinking there's another factor. Still, it would be interesting to hear more.
Anybody that has worked in a large American game studio also knows it’s a high pressure environment. Burn out is very common because these studios demand so much. Yet because of poor management (or overly paid management), Americans produce subpar products and studios like Rockstar Games continue to milk their cash cows (ie, GTA V - a 10+ yr old game that shits money due to GTA Online and micro-transactions).
No innovation in this market. EA continues to milk the sports series with minimal to no improvements in underlying engine (ie, Sims, FIFA and whatever the American Football one is called now). Epic Games just milks Fortnite (again with microtransactions). Mobile game studios are more like nanotransaction based “games” using tactics from casinos to get older and younger populations to spend money. Activision/Blizzard hasn’t pumped out anything new in a long time and continues to milk their cash cows (Call of Duty, Overwatch “2”).
Riot Games building off predecessors with F2P w/ microtransactions. RG produced games are _okay_, but really only LoL and Valorant are the ones I play.
Indie game studios sort of gaining traction but often overshadowed by larger game studios.
Also let’s not forget the monopoly that Microsoft has over gaming. Want a AAA game? Got to use their proprietary shit (DirectX) to build it and ship it. Probably need to obtain Windows licenses as well for dev purposes.
Some advancements in agnostic APIs such as Vulcan and alternative game engines (bevy). But so far haven’t seen them used in AAA games.
Vulkan has been used in quite a few AAA titles now (including the mass success that is Baldur's Gate 3). https://vulkan.org/made-with-vulkan
And while UE/Unity power a lot of games, many studios do opt for some propreitaty engine. All the big studios are still maintaining their own tech for sure. But I agree, I am waiting for that "third pillar" to emerge, ideally an open source one to prevent the possibiliy of a Unity mishap. We'll see how that dust settles.
Also, Blizzard recently released Diablo 4. Finally, you do not need a license to use DirectX. It’s a public API.
GTA is made in the UK. It’s not an American game.
> In late 2023 the average monthly gross salary of Polish workers is almost 8,000 pln (about $2,000) or about $24,000 per year. In the United States the monthly average salary was about $4,941 per month, coming in at about $59,300 per year at the same time period. In other words, investors and employers can pay for more Polish workers than American ones with the same amount of cash.
While this is true - in Poland the difference between IT and non-IT salaries are higher than in US, so it's not a good comparison for cost of hiring programmers in particular. The differences won't be as big.
Funnily enough the higher taxes in Poland are the main reason cost of development is effectively LOWER here - because you don't have to save for crazy expansive medical insurances or university funds for your kids - cause it's provided for free by the state - and the private alternatives have to compete with that - so they are cheap as well.
Yeah, don't want to get too political here, but I was read through that section and could only envison an ouroboros.
- The country nixes Universal Health care but companies then complain about needing to fund healthcare benefits.
- They kill Pension decades ago and slowly shift to a attrition oriented recruiting and they wonder why workers leave after 6-18 months.
- College becomes 3-4 times more expensive than 40 years ago, and then companies complain that entry level wants more money coming out to pay the unbankruptable debt (thanks Sallie Mae!) they had to take at 18 just to get noticed by recruiters at 22-23.
- Then instead you ask for "3-4 years of experience with a shipped game" for "entry level", but college doesn't count for experience. All while being unwilling to train juniors and just hope they hit the ground running.
Yes, the system is broken and companies have been hammering at the window for decades to help. No wonder it eventually broke.
15% of the screen is not an ad or a popup, on mobile. 15%. What the fuck.
Show Reader worked on this link but it’s not always available. Lately, it seems like websites are starting to block reader view.
Give this a try: (Kill sticky)
https://news.ycombinator.com/item?id=32998091
It's a javascript snippet that you stick in a bookmark and click on when you encounter a site like this. Results vary, but it did a great job of making this site readable.
Why don't you use an ad blocker? I don't see ads on Android with Firefox and Block Origin.
Brave has a mobile browser on Android that blocks most ads.
It's incentives. A studio nowadays is either outright owned by the publisher or is signed up for development with little or zero equity. In this situation the only source of income for a studio is the milestone payments or salary paid by the publisher so the longer development goes on, the more it gets paid and the more is the cost.
If American studios could find publishing contracts leaving them more than 50% of equity like they used to in 1990s-early 2000s they would be making games much cheaper. Even though you might get cheaper developers elsewhere, few have skills and spend most of the time on learning how to make games through trial and error, running costs up.
I remember how expensive Killzone appeared to the American game developers: the Dutch studio, apparently had hundreds of staff and tens of millions cost in early 2000s, when a better selling American game had been usually developed by a couple of dozens staff for under 10mil.
In the early 2000s? Couple dozen staff? Making games that rival Killzone for revenue? Shadow Fall was the first PS4 game to hit the million sales mark, for example. Killzone 2 hit a million after a few months.
It's amazing to see how much money is spent on not much playability. The teams are too big and there are too many managers. Cost cutting by moving jobs abroad doesn't solve the core problem of games not being very enjoyable. I'd rather trade fancy graphics for something that is fun to play.
Gameplay is king, but Art sells. It may not work on you, but so many people just see a pretty game, and go to buy it. They don't mind $70 because they only buy a few games per year. Especially with so many F2P options out now.
Ofc this model doesn't work with GaaS, which isnt the new golden goose. They try for 6 months, realize they didn't get fortnite money (even though Fortnite had to do a lot just to get off the ground) and shut down in a year to try the same insanity again. This is what happens when you have Business driving games instead of creatives, and I'm not quite sure when they'll learn the lesson (or go back to non-GAAS where this strategy works).
Also relevant to this is the Game Industry Layoffs tracker @ https://publish.obsidian.md/vg-layoffs/Archive/2024
Game development is an interesting industry where both happen to be true:
1. It's too expensive to make a game
2. Employees in the industry don't get paid enough
Similar industries include childcare, where you hear politicians decry the cost of childcare in the same breath and how little the workers in their field are getting paid.
Maybe the costs are somewhere else, not employees? Nope. From the article:
> That cash flow is essential because a studio's operational costs remain fixed (or even increase) while revenue fluctuates up and down. Like most software companies, game development operating costs are derived almost entirely from salaries. And in the United States, there are dozens of factors that drive salaries upward.
So I guess the article is arguing salaries are too high, which is not something you hear too often in the game industry context.
Modern game development requires an awful lot of people. It's not so much that individual salaries are too high, but that there are too many individuals involved. If you ever watch the credits for a game, they've gotten so much longer than in decades past. Games are more complex, and have a lot more detailed content, and all that, so it's not that people are less productive, but still. The same thing happened in movies as well --- most movies with any sort of effects are going to have ten minutes of credits.
> Similar industries include childcare, where you hear politicians decry the cost of childcare in the same breath and how little the workers in their field are getting paid.
Childcare is heavily regulated, so it is impossible to increase productivity. In fact, local childcare boards tend to force lesser productivity by reducing the number of kids one staff can look after, while crunches are impossible. There really is no way to cheaper more accessible childcare because it is legally not allowed (for perhaps well justified reasons).
Game development is the opposite of that, GenAI could take over and as long as ChatGPT can produce a fun game, it is allowed to do so.
That's just the regions with best economics getting treats of Baumol's effect[1]
Countries with mediocre economies often afford child care and gamedev without much trouble, since their productivity is also mediocre hence their wages and spendings don't run off.
So games are too cheap. For $50 you can get near-endless dynamic content created by passionate people.
For the same price you can watch a pre-made movie out (granted, usually movies have higher production value and it's a night out), or two nice hamburgers.
It might not be salaries directly but things like healthcare costs and retirement savings. So a developer can still be "poorly paid" but costing the company a fortune in benefits.
How could a journalist write so much and research so little as to completely miss any mention of the ongoing section 174 disaster? They even mention “tax” eleven times and specifically mention small studio cash flow issues and costly salaries, but payroll taxes and tax credits are all nothing-burgers, not worth the words on the page, compared to the insolvency insanity of being only able to expense and deduct 10% of a developer’s salary in the first year and depreciate the rest over five years.
I thought Canada is where games are made now
When the chief marginal cost of your product is employee wages why would anyone be surprised that the country where wages are most expensive makes it the hardest to produce a profitable product as the marketplace opens more and more globally and gets saturated?
Insane how many words the author uses to capture "costs are higher for US game studios because salaries are higher". There's no actual secret second thing and it's hilarious watching the author try to find a way to spin "people make more money" into a problem with capitalism.
That begs the question though. That's what the "many words" are used to explain.
But yes, inflation + rising housing costs + a lack of retention + a lack of governmetn interest in the arts are all indeed "a problem with capitalism". You should read those words a bit more closely.