Hardcore Gaming's Salvation?

Quarter to Three talks to three developers about the profits and perils of bypassing the traditional retail market

Con't.

Qt3: What kind of volume do you need to turn a profit if you sell direct?

Wardell: It depends on the game obviously. For The Corporate Machine, our budget was pretty low. If we sell 20,000 units in its effective life time, that would be great. Entrepreneur sold 75,000 units but because of the costs of retail, we basically broke even on it. We'd make a profit at 20,000 units on The Corporate Machine.

Dunham: I'm not really sure how much we would have had to spend to keep King of Dragon Pass on the shelves, so I can't give you a very exact number. Obviously we sell to retail at a significant discount (and pay for shipping), so it takes more units. Since we'd always planned to have some retail (through the adventure/hobby trade), I don't have any direct-only projections, but some quick checking suggests that 30K units might break even (depending on how long it took to get there). Retail would take at least twice that number of units.

Moylan: We did a rough calculation that combined profit per unit, risk, shelf life, and the long-term advantages of setting up a direct link to our customers, and we determined that we would be better with a direct sales model if direct sales were even just a small fraction of expected retail sales. When you consider that the cost of selling direct is so low, and the cost of being in retail is so ridiculously high, the numbers add up undeniably.

We've been selling our game Combat Mission: Beyond Overlord online for just six months now and I couldn't be happier with the results. We're selling about five times the numbers we expected to sell, and I can safely say that I don't think Big Time Software will ever do business with a traditional publisher or a retail chain ever again. As an independent we have more freedom, we're not subject to stupid decisions made on a whim by clueless Dilbert-esque executives who don't understand games, we're not at the mercy of retail chains who want huge payments for shelf space, we don't get forced to sign horrible contracts, and on top of all that... being independent is more profitable.

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