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Rumor: Microsoft Cuts Indie Royalties in Half - MS Responds


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#1 Xbox-Scene

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Posted 23 February 2008 - 02:43 AM

Rumor: Microsoft Cuts Indie Royalties in Half - MS Responds
Posted by XanTium | February 22 20:43 EST | News Category: Xbox360
 
From kotaku.com(1)/kotaku.com(2):


News of Microsoft's democratization of indie game development was overshadowed this week by an increasing discontent among established indie developers that the company was halving the royalties paid to them for future Xbox Live Arcade projects, several well-informed sources told Kotaku.
Several developers directly affected by the cut told Kotaku that the once generous royalty share of 70 percent given to them by the company was within the past few months cut down to 35 percent.

Microsoft just responded to our request for comment with this statement:
"Xbox LIVE Arcade has long been known as the premier destination for digitally distributed original and classic games - making it a very appealing platform for game developers. We don't disclose details on our business contracts, but what we can tell you is that we work closely with all of our partners to provide the Xbox 360 community with the best entertainment possible while making publishing a title on XBLA an attractive prospect."


Full Story: kotaku.com(1) | kotaku.com(2)






#2 proger

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Posted 23 February 2008 - 05:42 AM

Greedy Bastards.

#3 Johnwinger

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Posted 23 February 2008 - 05:51 AM

Microsoft is seriously worse than the IRS.

Also, anytime they make a comment is seriously pisses me off. Some lame generic statement like a stupid computer spitting out a Windows error code.

After Vista I lost what respect I had left for their company.

#4 twistedsymphony

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Posted 23 February 2008 - 08:03 AM

Standard Operating Procedure for any mega-corp unfortunately...

this is just a dumb move on their part.

looking at the sales figures for most of those indy games... then cutting music licensing, equipment costs, XBL's QA fees taking away MS's chunk and splitting the rest among the developers... they really don't get paid much from the platform in the grand scheme of things.

I think most people would agree that the majority of XBLA titles are overpriced as it is, a move like this will only shy away indy developers from the platform or convince them to jack up the price and watch their sales figures plummet.

#5 echto

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Posted 23 February 2008 - 08:19 AM

WOW! Talk about righteous bullshit! I think MS is getting a little jaded about their live service.

#6 g8crapachino

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Posted 23 February 2008 - 11:01 AM

{Sigh} What part of "RUMOR" do some of you don't understand? Kotaku isn't exactly the leading source of anything factual; especially given their steady stream of secret well sourced insiders who are always conveniently eavesdropping on every meeting, discussion, conference, bathroom stall you can think of. Sure you can read and assume the worst about an empty PR response from Microsoft but until things become more then rumor it's stupid to worry about it.


Incidentally, do any of you happen to know what the actual going rate is for a royalty share to an Indie game developer usually is? Assuming that 35% is bad may be a little premature..

Edited by g8crapachino, 23 February 2008 - 11:16 AM.


#7 Altima NEO

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Posted 23 February 2008 - 12:22 PM

QUOTE(g8crapachino @ Feb 23 2008, 02:37 AM) View Post

{Sigh} What part of "RUMOR" do some of you don't understand? Kotaku isn't exactly the leading source of anything factual; especially given their steady stream of secret well sourced insiders who are always conveniently eavesdropping on every meeting, discussion, conference, bathroom stall you can think of. Sure you can read and assume the worst about an empty PR response from Microsoft but until things become more then rumor it's stupid to worry about it.
Incidentally, do any of you happen to know what the actual going rate is for a royalty share to an Indie game developer usually is? Assuming that 35% is bad may be a little premature..


True or not who knows yet, but if it is, thats a pretty sharp cut, regardless of how much 35% amounts to in the end.

#8 stevenalvarado

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Posted 23 February 2008 - 01:40 PM

ok. according to this: first it was 70%, then 35%. dry.gif

would anyone like your salary to be cut in half? grr.gif

#9 quall

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Posted 23 February 2008 - 03:32 PM

I agree. These games are only distributed online, and on the 360. MS only has the cost of bandwidth and hosting space.

MS still needs to return their cost from money spent on the xna kit, but this is crazy. However, this is not unlike any other publisher. Actually, most indie devs get far less.

#10 fakesky

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Posted 23 February 2008 - 04:12 PM

Not even the most prominent creator, no matter what product they design, has royalties at 70%,
I'd say close to no one even has 35% if I we are to believe that number goes straight off the top.

Im sure MS got the Arcade thing rolling with huge royalties, which obviously worked,
but at this point we have creators raking in money without spending a dime on sales,
while MS has to front the costs of distribution and marketing forever.

I hardly think it's fair to maintain that the creators should get insane royalties when
it's actually the Live! platform, now a huge success, that's driving the sales.

Think of the previous rates as "loss-leaders" if it makes any more sense.

Now, I totally understand that the developers are pissed at the pay-cut,
but they were equally naive when they thought the goldrush would last forever.

#11 Devedander

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Posted 24 February 2008 - 12:29 AM

I agree that I would not like to see my profits sliced in half, however we really need more info before judging whether or not 35% is really that bad...

I would think this might be very much like promotional cable/phone rates... you have to spark interest from the developers to get the ball rolling, then when busikness becomes solid you fall back to more standard rates.

#12 h3xagram

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Posted 24 February 2008 - 02:31 PM

50/50 would have been a fair cut...

#13 88 Ecko Unltd 88

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Posted 25 February 2008 - 12:44 AM

BS on microsofts part grr.gif

#14 TheButler208

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Posted 25 February 2008 - 10:56 PM

QUOTE(echto @ Feb 23 2008, 02:55 AM) View Post

WOW! Talk about righteous bullshit! I think MS is getting a little jaded about their live service.

yeah there lovely live service that doesn't even use fu$%ing servers to host games. And we pay for this?




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