Greg Costikyan has been a gadfly of the video game industry for a long time. He’s a game developer, most recently having spent a stint as a mobile games consultant for Nokia. He has made more than 30 computer and board games in his career and a number of the games were award winners. One of my favorites was “The Creature That Ate Sheboygan,” although at this point I barely remember that 1979 game. In September, he resigned from Nokia to co-found Manifesto Games, which is an online publisher of independent games that have all but disappeared from store shelves. He and his co-founder Johnny Wilson hope that an independent movement in games can elevate the industry the same way other movements have in film and music. He lives in New York city and was recently awarded the “Maverick” award of the Independent Game Developers Association. The award goes to game developers who take risks and engage in unconventional experiments. The ceremony takes place on the evening of March 7 at the Game Developers Conference in San Francisco.
Q: Tell me about how you started Manifesto Games with Johnny Wilson?
A: I’ve been thinking and writing about the need for the game industry equivalent of the indie film and music movements for years, and had even worked on a business plan for an independent games publisher at one point, but could never really convince myself that it was workable. Three things changed my mind: First, the spread of broadband means that downloading games, even multi-hundred megabyte ones, is again feasible. (I say “again,” because it was feasible back in the day of Doom–but CD-ROMs bloated application sizes even as the Internet became popular, and bandwidth improved much more slowly. So for many years, digital distribution was–not impossible, but hard.) Second, the success of the casual game market has demonstrated an approach and business model that can succeed. And third, it became clear to me that there was a hunger among game developers for something like Manifesto–which wasn’t true even five years ago. The response to my rant on the subject at the Game Developers Conference in 2005 brought that home.
Johnny (who lives in the Atlanta area) was visiting New York at one point, and I had dinner with him, along with Eric Goldberg (an advisor to Manifesto) and Charles Ardai (founder of Juno). We discussed the idea, and Johnny indicated an interest in being involved.
At the time, I was working full time for Nokia, and I didn’t really think it was fair to them to try to put together a start-up while drawing a salary, so I quit, and we announced the company in late 06–with, at that stage, no capital, no deals in place, no technology–nothing. Probably crazy, but it’s what we did.
Q: What were your observations about the state of the game industry as you did so?
A: From my perspective, the growth of the game industry over the last three decades has been a story of amazing creativity and innovation. When I was a teenager, there were really only two types of games–mass market boardgames, and tabletop wargames. Today, it’s hard even to name all the different sorts of games available–RTS, FPS, arcade, adventure, trading card games, digital RPGs, and on and on… From a game designer’s perspective, it’s been an exciting time to be alive, whole new genres being invented almost every year.
But over the last decades, the walls have started closing in. It’s become harder and harder for developers to get any game that’s remotely creative funded, and almost everything that gets published is either part of a franchise (i.e., game six in a series) or based on a movie license. Even when the publishers dare to fund what they call “original IP”, they almost always do so in one of the handful of styles they consider marketable–console RPGs, RTS games, and the like.
The basic problem is the scale of modern budgets. As recently as the late 90s, budgets were typically under $1 million; today, $10 million is the bare minimum for a AAA title…. And that kind of money fosters conservatism. It also requires 1 million-plus unit sales for success, meaning everyone is chasing after the mass market, and game styles that people still love, but that can’t generate sales at that level, fall by the wayside–graphic adventures, computer wargames, and the like. In essence, the conventional market finds it impossible to develop games for niche audiences, but in every other entertainment medium, it’s possible to succeed by catering to niches.
You can’t do it through the conventional retail channel, because most game stores have maybe 200 facings for games, and most games have a two-week onsale window. Retail is geared toward the hit-driven mentality of the publishers, and to compressed sales–no opportunity to build word of mouth.
If you move online, however, that constraint falls away. Most indie developers would be delighted with 10,000 unit sales, because their cost structure is very different.
The casual game market shows one path to success; they sell games that the conventional industry abandoned long ago, to a demographic group (middle-aged women) that never enter Gamestop. And the financial success of the casual market has drawn a slew of developers who are discontented with the status of the conventional market. Our thought was that by adopting the same business model as casual games, but by catering to people who consider themselves gamers (and thereby avoiding competing with the likes of Yahoo! and RealArcade, who have deep pockets), we could also achieve success. And once we can prove the viability of the market, the floodgates will open–developers will flock to indie games they way they have to casual games, and we’ll see a surge of the kind of creativity that’s so sadly missing.
Q: What was your manifesto, in summary?
A: The game industry, once the most creative and innovative entertainment medium on the planet, has become a stultifying morass of imitation and mediocrity. We need to break free of the rigid constraints of the current market, and find a way to sustain the creativity and innovation that’s been the birthright of gaming since its inception.
Q: What does the company do?
A: For the main part, we sell independently developed games via direct download, with demos (of various types) available for everything we sell. Unlike most such retailers, we view marketing–that is, getting out the word and drawing attention to the games we offer–as a key part of our job. To put it another way, marketing is not a core competence for most developers, and it’s one of the things that conventional publishers provide; if independent games are to become a commercially successful category, someone needs to assume the marketing role.
Q: What result have you had?
A: We’ve achieved a modest level of sales, and the curve is on an upward path, but we’re very aware that we have a long way to go. To succeed, we’re going to need to continue plugging away to get the word out, and we’re going to need to raise some capital to both build the technical infrastructure and the consumer awareness we need to achieve our goals.
Q: Do you think you’re succeeding in the broader mission?
A: I’m hopeful, but I’m also very aware we’re just at the inception of the process. Keep in mind that we’ve only been live since September.
Q: What have you found in terms of the receptivity of independent game developers to your company?
A: For the most part, developers have been enormously supportive–they know they need something like this, and they very much want us to succeed. This isn’t a surprise–many other people have noticed the same trends as I, and are eager to find a way out of the trap the industry has set for itself. The larger question is whether we can inculcate among -gamers- (as opposed to developers) an aesthetic that prizes gameplay over glitz and playfulness over polygons–the same kind of aesthetic that draws people to independent movies and music.
Q: Who else is making an impact on games in the same way that you are?
A: Valve’s Steam has been helpful in exposing many indie games to a broader market. Garage Games has been preaching a similar message for years, and the availability of its Torque engine at low cast has been a great boon to independent developers. Game Tunnel–a review site that specializes in independently developed games–is also great.
Q: How big can this become?
A: Well, let me put it this way. Since 1998, retail sales of PC games have declined from $2 billion domestically to under $1 billion now, even as console sales have soared. The conventional claim is that this is because gamers have flocked to consoles–but I believe that’s wrong. Household penetration of PCs has increased over the period, and a priori, there’s no reason to believe the PC game sales shouldn’t have increased.
I believe the main reason for the decline is that PC gamers are not being adequately addressed by the conventional publishers. The problem is that with today’s massive budgets, you need to release over multiple platforms, so games are developed with console controllers in mind, and don’t work as well on PCs. Or as I’ve sometimes said, PC gamers are getting Xbox’s sloppy seconds. Similarly, many game styles that fine on PCs but don’t with console controllers–e.g., graphic adventures–have been abandoned by the publishers, because it’s awfully hard to generate 1m unit sales if you’re releasing on PC only.
In short, I think there’s a huge latent demand for PC games that’s being untapped, because of the publishers’ relentless pursuit of best-sellers and their inability to address niche audiences. So: How big can this get? I’d argue that the $1b drop in PC game sales says that the publishers are leaving a cool billion dollars on the table.
Q: Are you making money?
A: We have revenue; we’re still operating in the red, however.
Q: Are you raising money?
A: Yes, I’m out prospecting for capital at the moment.
Q: How are you selling your games?
A: In essentially the same way as the casual game portals; there’s a trial version for everything, and if you like it, you pay online and download the game online. The main difference is that we’re a lot more flexible about how we do things; most casual portals have a “one-size-fits-all” model where everything costs $19.95, and everything is a 60 minute trial. Our prices range from $3 to $65 (though $20 is typical), and while some games are a 60 minute trial, others have stand-alone demos with unlimited play, others are 5 hour trials, etc., etc. Basically, games are different, and what makes sense for one game may not for another.
Q: Is digital distribution working?
A: Sure. I mean, in terms of dollar volume, we’re a tiny pimple on the game industry’s butt, but we have hopes of becoming… a… uh…. large and unsightly boil. Okay, this is a really bad metaphor.
Q: How do you feel about getting the Maverick award from the IGDA?
A: It’s both gratifying and terrifying. Gratifying, because it demonstrates the support and high hopes for Manifesto on the part of the game development community… And terrifying, because fundamentally, we haven’t remotely accomplished what we’re trying to do. Some years from now, I hope to be able to look back and say that dozens of developers are commercially successful because of what we’ve been able to do for them, and that indie games is now a large and growing sector in the industry. But today, we’re just another path to market for indie developers struggling for attention, and the contribution we provide is pretty modest. In other words, the Maverick award establishes a set of hopes and a standard that we’re going to have to work very hard (and have a lot of luck) to achieve. Not that I didn’t already have strong incentives to try to make this work, but the award raises the bar.