This isn’t an easy industry to work in. If having an original idea and development chops was all it took to turn a profit, we’d likely see professionals by the truck load rushing to mine the gold right out of game development. However, changing business models, tight budgets, and the fickle nature of consumers makes creating and selling a new game anything but predictable, and Hi-Rez Studios co-founder Erez Goren has recently taken to Reddit to explain how his company’s last two games have not been financial stars.
Goren bluntly stated that the company's first two projects, Global Agenda and Tribes: Ascend, did not make money. In fact, he estimates that the developer spent $30 million in funding on development, and made only $10 million in sales. Those are not the numbers you want to see if you’re hoping to keep the lights on.
“Most games fail, some games break even, and a tiny number of games are very successful,” Goren admitted. “That’s the nature of the gaming industry. So, for every WoW, LoL, CoD, and TF2 there are hundreds of games that are dead.”
Let’s not spend too much time talking about failures and the grim nature of our favorite hobby. Smite, Hi-Rez studios’ next free-to-play project, is actually appearing to be the company’s first hit. Instead of draining every bit of money the team has left, this MOBA is turning a profit.
“Smite is one of those rare games that’s actually growing every month, and is also profitable. This is allowing us to grow the Smite team and deliver weekly updates and content (from 15 people initially to about 80 people now),” he said. “In addition, many outside publishers were interested in Smite and we are fortunate enough to have made a deal with Tencent who is the most prestigious partner we can have for our type of game.”
Whether or not it’ll become the next League of Legends is unknown, but for a company that just hasn’t been able to catch any sort of lucky break over the years, this has to be gratifying.
