Why Do Games Cost So Much To Make? – AAA Game Budgets – Extra Credits

Let’s talk numbers: marketing, office space, dev tool licenses, voice actors, and more that goes into the average AAA game budget. Why do some games never …


29 Replies to “Why Do Games Cost So Much To Make? – AAA Game Budgets – Extra Credits”

  1. not to be rude but i dont buy many AAA games what does it cost for a smaller game developer? or an indie one ? sure AAA game companies spend alot butthere are alot of none triple AAA game companies and smaller game studios. on top of that, lots of game companies dont sell a million copies of theirs games, some dont even sell 100 thousand copies, how do they make back the costs of the making of the game?

  2. Hey, Extra Credits, i love your show. Would you consider doing an episode about crunch time and burnout culture in video game industry? Everybody likes playing video games but they don't stop to thing about the amount of effort it takes to make one. Or they just do not believe it is reality for some creative workers…

  3. Extra credit seems like a corporate shill from the way how this video was written and about how no freaking proper look into this happened.

    Facts that disprove the BS in this video:
    1. The cost of creating games has been steadily decreasing over the last 5-6 years. As they still use old engines, are more experienced in using those engines and franchises have been re-using assets like it's nobody's business.
    2. Mobile game markets aim at a different audience than PC. The people on mobile being used to 1-10 dollar games don't leave "the gaming audience" the impression that games are only worth that much, gamers just don't generally want to pay for something they'll only play on their toilet, or they have an handheld console instead which is more likely.
    3. THE BIGGEST POINT. The value of publishers has had explosive growth for the last 4 years. A lot of companies more than tripled or quadrupled their stock value over the last 4 years. How can you say that games don't make money when publishers have been filling their coffers with money you can't even imagine. For a normal company it would be great if they could increase their company value by 10% within a year when they're decently sized, game publishers were literally increasing their value by 100% or so each year.
    4. "The real price of games should be 75-80$. I am sorry but that's BS. The fact again is that most of the money that companies with micro transaction and loot box make is through whales, who pretty much pay for 90% of the transactions. They helped Rockstar make multiple billions just from their GTA online shark cards.

    So to sum things up on why this video is BS – The companies HAVE been making CRAZY amounts of money, they have had to use less money to develop. Most of their money is spent on marketing not development and even that is easily recouped from whales (And the people who fail even with good marketing just fucked up generally and they shouldn't succeed). In the past they also gave us free updates and content. Micro-transactions ask you to give out 20 dollars for something that 1 developer guy spent 3-4 hours designing.

    The Witcher 3 is an example of what you can do if you are fair to your playerbase and actually put in effort.

  4. I love that shout out to Matt Mercer as your famous voice actor. Nice that you chose industry talent over someone from outside brought in for their star power as much as their acting talent.

  5. Who has ever bought a game because a big name voice actor is in it?

    If the 60 dollar tag is making 70% of the market not buy your game, how does that help you to make your budget back?
    Wouldn't reducing the price actually make you earn more? 60 x 30% of the market is less than 30 x 70% of the market. make them more accesible and put less superfluous bullshit on them, don't knickle and dime people and not only are you gonna make more money but you will also build good faith in consumers who will come back for your next game.

  6. You don't need so much money for advertisement, especially for an established title. People already have expectations of what kind of game Elderscrolls, Witcher, or Civilization might be. You only need to announce your developing it and then when it comes out, in the areas where it would be looked for anyway. Like getting your game prominently showing on Steam when it comes out, Established titles already get a bit of free press and more if they work at it, like how DT got lots of free press. Provide your title to reviewers and they will talk about the game for free because the fan base is already waiting to hear how it is, and they will provide word of mouth if it's a good game.

    In fact, excess hype can be a bad thing. It was for Witcher 3. There are many complaints that the advertisement for it showed a game with better image quality than the game actually had. Or that the game graphics downgraded, possibly to fit on console but failed to provide a option for advanced graphics for those with powerful systems. Witcher 3 succeeded despite its advertisement because its a good game and word of mouth spread it far and wide. Well I've not actually played it but reviews are great and I plan to buy it eventually (it would help if it were Linux compatible) Other examples where games failed to live up to their hype and were unfairly harshly judged as a result. But it is fair to blame them for putting so much on advertisement in the first place and for not being honest. I think companies who spend a whole game again on advertisement are fools, especially if it's a big budget game. If they spent much of that money on the game itself for a good game, word of mouth will do much more work for you than some TV ad or whatever.

    On a related note. Gamers mostly don't care about celebrity voicing. I think the only time something like that might be called for is if the game is based on an existing franchise that isn't a game. Like you're putting out a Spiderman game based on a specific line of Spiderman movies, I can see using the voice acting of some of the people from the movie. It all comes back to that chasing after and copying existing successes. This lazy Hollywood model that echos everything else and remakes everything else because what it is remaking was shown to be successful so they want a piece of that. When you have a celebrity in something for the sake of celebrity, you are hoping to trade on that previous success.

    And don't spend so much on management and CEOs, but such essentially theft by those already well to do probably wont stop with big corporations since those who decide are those who benefit.

    Some of the tension with all this advertisement business is also the tension of DMR and pirates. Companies feel they can't wait for word of mouth, but must sell ASAP because once a game is cracked its value may plummet. At the same time DMR is an additional expense that can hurt your paying customers. So extra money is wasted on advertisement and DMR in hopes of squeezing in the game before pirates crack the game and squeeze it out.

    Graphics wise, it really depends on the game and your target consumer base. Take Stardew Valley, a game whos success is based on word of mouth and does not need fancy graphics. Or Terraria. And so on. Granted you don't want your games looking like total shit where it's hard to tell one thing from another. But a minimal amount of effort for decent 2d graphics or whatever can go a long way. You certainly don't need to be cutting edge in graphics anymore. Game mechanics trumps graphics, and lots of other stuff too. Here is another example, Civ4, it's a good game, but you can tell they tried to be 3d and it didn't work out very good. Things don't look better as a result, the sideways view can get in the way of playing sometimes. You got to wonder if some of that money, time, effort had been put into better game play (and there are areas of the game that feel a little incomplete) how much better it could have been. Now a game like Elderscrolls, yeah you want great graphics. but again acceptable graphics but great gameplay will almost always be taken better than acceptable gameplay but great graphics, and since graphics cost so much more… isn't it obvious where the money should be? But then we come back to advertisement and the piracy time table.

  7. The question I've got about marketing is, why do you need to spend so much money on it? Once upon a time (pre-internet) you needed to plaster stuff on the sides of buses and put billboards up all over the place to get the word out…but YouTube (and Twitch, Twitter, Facebook, etc.) exists now. I get 99% of my information on new releases from YouTube – that goes for films too. You've got the big expos where games are announced (I guess they're expensive to get on the stage at, but not many millions expensive), and there are numerous outlets that report that stuff (for free!). Even on the occasion that developers directly pay or reach out to YouTubers, it's not a whole lot of cash – think about the Fallout 76 pre-beta thing where they flew a bunch of big YouTubers out to the Bethesda studios to have a go playing it (and completely put me off buying the game). I've never understood the draw of big-name actors in games either (I didn't clock on that Liam Neeson was in Fallout 3 for ages). Most marketing nowadays seems to be through creating a social media buzz, and surely that's more or less free?

    If you're Bethesda or Activision or Ubisoft or any of the big developers you have people – YouTubers, game journalists, etc. – watching your Twitch or Twitter feed 24/7. I don't know how promotion works on Steam, but obviously Steam get a cut of sales, so they'll actively push games they think are going to be successful to customers whom they know play certain types of games. The same is true for any retailer. Trailers get shared on Facebook among friends – you don't pay for that either because it's just been shared from YouTube rather than actively promoting from Facebook. Why does Call of Duty need massive promotion? I'd be more surprised if a new one wasn't coming out.

    It's different for small developers, but I like a number of indie games and they've usually come recommended from an article or video. Like Banished – it's an indie city building game (just one developer who did everything for it) – I think I came across from article about upcoming city building games, which I read because I like city building games and fancied a change from Cities: Skylines. My point is you only need to get your game out to a handful of influential outlets (including the ones that have become memes like IGN), and that's pretty cheap – you just give some games journalists (on any media platform) a chance to play your game and if they like it they'll promote it in an article somewhere. Above all, nothing is a substitute for word of mouth – Doki Doki Literature Club for example is a game I never in a million years would have picked up ordinarily, but I did because for whatever reason it went viral and my cousin said I should play it if nothing else just to see what the fuss was about. Again, just a single developer. Same goes for games made by small studios like Don't Nod's Life is Strange, which I found myself enjoying and came across via YouTube. That introduced me to China Room games/walking simulators with very small budgets and teams.

    The volume of games doesn't matter – most of them are just crap games that only a handful of people will ever play. If you make a game that's actually good then just by word of mouth and the magic of social media advertising algorithms it'll gain traction. The riskier thing is hyping up a game with complex marketing and releasing something that's terrible (No Man's Sky, Fallout 76, etc.), and I've just watched your buggy games video!

    The other thing I don't get are the production costs, particularly for an established franchise like Call of Duty. The games don't change much between titles – I like the Modern Warfare trilogy for what it is, but in terms of the mechanics and design they're more or less identical. Surely a fairly substantial amount of the core code is copy and pasted? Why does it require 500 people to work on CoD full time? These aren't dynamic open worlds with complex branching dialogues or anything like that – they're linear shooters. I really don't understand where the complexity lies here when you have such a well-established framework to develop from. The mo cap I'd have thought is the main time/money sink.

  8. I'm not disagreeing with you, I'm really not, but I gotta call BS on the inflated numbers you're throwing around. Office space, equipment, that's start up cost. That's making a company cost. A successful publisher isn't paying these costs, or they're only upgrading existing equipment. You added that cost into your estimate before the marketing, calling half again as much off an estimate that includes start up cost. Again, I'm not disagreeing with you, economics are economics, prices go up eventually, I still remember when we paid $50 for new AAA games. Giving you the benefit of the doubt, I don't think you meant to misrepresent, but that is a problem.

  9. 200 employees for 2 years = $40 million, Yeah, if you're paying them $100k in salary + benefits. The mean pay for game developers is 64k, you can add 20k for benefits… Already we're down 6 million on the budget. 10k could likely be shaved off of benefits for the game dev environment as well, bringing us down another 4 mil

  10. Hmm this is quite an interesting video but i would be interested in one looking directly at AAA games developers that already have a large scale following. I've noticed that AAA Developers have a tenancy to build a great game and then go and actually mess it up and generally alienate the original fans by attempting to gain new audiences.

    On one hand i understand that they are looking to make more money with each successive game, however i also notice the series that they have managed to actually sink by trying to do this could have continued to make the company money should they have simply decided to focus on what made their game interesting to the player base in the first place. Series that seemed to be cash cows due to people already knowing about them and getting super hyped when a single date was mentioned as possibly coming out, you would think not require the same level of marketing as a new game that has no following but certain companies seem to get it in their heads that this extra fame actually requires more to be spent on marketing which is a backwards kind of logic if I've ever heard one.

  11. profit 75 millon is a big number but 11 millon coppies of black ops 3 sold? Thats 75,000,000 cost vs 60$ × 11 millon = 660,000,000 thats alot of profit without microtransactions. Not everyone pays full price and you dont make that full 60$ but we are just using rough numbers here am i right?

  12. You know a suspicious lack of persona or the tales games in this video bothers me. Since they are successful even with the technical downgrade to a more anime-ish art style

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