Financial issues
Financial Issues Affecting the Games Industry
There can be a variety of financial issues that could occur within the games industry which may prevent the completion of a project for example the business may have though they have got the money to create the project but it turns out they haven’t, which results in the closing of the project unless they can find funding. Another reason may be because the publishers have pulled out because the deadline hasn’t been met. This means that the funds stop coming into the project from the publisher funding organisation. When the publishers pull out of a project they will require a fee because of the time the developers have wasted. Another thing they may happen is the gaming business may have gone bust.
Milestones are in place in the development stage of the business to ensure that no financial issues or deadlines are a problem. They keep the business organised so that every step of the way the project is at the stage it needs to be. The milestones are usually set out in the three stages; alpha, beta and gold. All three of these stages occur in the production stage.
Alpha is usually the stage that most of the bugs in the game are found as well as errors. This gives the publishers an idea of what stage the game is in and gives them a rough idea on when it will be completed. After this stage comes beta. This is the stage where the game goes to public testing, to ensure that the game is operating the best it possibly can. Once released to public testing and the game have passed; the next part of the milestones comes in. That is gold. During this stage QA testers will take a look at the game ensuring that there are no longer any bugs in the game. These bugs are ones the public don’t seem to pick up. This stage is also when the retailers are waiting for the product to arrive.
In some occasions the publisher may bring the gold release date back giving the developers less time, to make copies of the game and finish off the gold stage. This is why some games have bugs when released.
One of the biggest issues to the financial side of the industry is piracy. This is very common as many people take part in this crime. It is basically stealing Video games. An example of when this has affected a business is when ‘Call of Duty Modern Warfare 2’ was coming up to be release. Before the game had even reached the shelves people had contact with the game and they were playing on Xbox live. This created an issue for retailers as well as ‘Infinity ward’ and their publishers ‘Activision’ as people already maintained the game, which means that they will not pay for the game as they have already played the campaign as well as the online game play, so the business will not receive any money for those games. Luckily it hit sales hard and still game the business profits, but this is very nerve racking for businesses.
Here are a few of real life examples of financial issues that have occurred ion the last few years:
‘Sam Baker, an animator with Factor 5, has revealed that the developer is undergoing "financial issues" since the collapse of the publisher Brash Entertainment, leading to the cancellation of a project and unpaid wages.’ This is basically saying that ‘Factor 5’ has discovered that their developers have been undergoing financial issues because of the closing down of their publisher ‘Brash Entertainment’. This has lead to the shutting down of the project and has resulted in a lot of unpaid wages.
Kath Brice explains that ‘Lower the price of the PlayStation 3 would have made a difficult year even worse for Sony, according to Epic Games' vice president Mark Rein.’ This means that the businesses had a hard time in getting the funding in order to make a profit on the PS3. This is why in the future the Playstation and Xbox are both releasing a full motion device. The Playstation’s is called ‘Wand’ and the Xbox’s is ‘Project Natal’. These two projects are being created to ensure there are no financial issues; basically they are playing it safe, because both companies do not want to release another console e.g. PS4, because at the moment not everybody has got a HDTV television in their home. This will be needed for the new consoles. If people have not got these televisions in their homes is causes the problem that Playstation and Xbox aren’t going to sell that many console as the customers won’t have the facilities to support them. That is why they are going with the motion projects.
Kath Brice. (2009). Rein: Sony financial issues prevented PS3 price drop. Available: http://www.gamesindustry.biz/articles/rein-sony-financial-issues-prevented-ps3-price-drop. Last accessed 11 December 2009
James Lee. (2008). Factor 5 face "financial issues". Available: http://www.gamesindustry.biz/articles/factor-5-face-financial-issues. Last accessed 11 December 2009.
There can be a variety of financial issues that could occur within the games industry which may prevent the completion of a project for example the business may have though they have got the money to create the project but it turns out they haven’t, which results in the closing of the project unless they can find funding. Another reason may be because the publishers have pulled out because the deadline hasn’t been met. This means that the funds stop coming into the project from the publisher funding organisation. When the publishers pull out of a project they will require a fee because of the time the developers have wasted. Another thing they may happen is the gaming business may have gone bust.
Milestones are in place in the development stage of the business to ensure that no financial issues or deadlines are a problem. They keep the business organised so that every step of the way the project is at the stage it needs to be. The milestones are usually set out in the three stages; alpha, beta and gold. All three of these stages occur in the production stage.
Alpha is usually the stage that most of the bugs in the game are found as well as errors. This gives the publishers an idea of what stage the game is in and gives them a rough idea on when it will be completed. After this stage comes beta. This is the stage where the game goes to public testing, to ensure that the game is operating the best it possibly can. Once released to public testing and the game have passed; the next part of the milestones comes in. That is gold. During this stage QA testers will take a look at the game ensuring that there are no longer any bugs in the game. These bugs are ones the public don’t seem to pick up. This stage is also when the retailers are waiting for the product to arrive.
In some occasions the publisher may bring the gold release date back giving the developers less time, to make copies of the game and finish off the gold stage. This is why some games have bugs when released.
One of the biggest issues to the financial side of the industry is piracy. This is very common as many people take part in this crime. It is basically stealing Video games. An example of when this has affected a business is when ‘Call of Duty Modern Warfare 2’ was coming up to be release. Before the game had even reached the shelves people had contact with the game and they were playing on Xbox live. This created an issue for retailers as well as ‘Infinity ward’ and their publishers ‘Activision’ as people already maintained the game, which means that they will not pay for the game as they have already played the campaign as well as the online game play, so the business will not receive any money for those games. Luckily it hit sales hard and still game the business profits, but this is very nerve racking for businesses.
Here are a few of real life examples of financial issues that have occurred ion the last few years:
‘Sam Baker, an animator with Factor 5, has revealed that the developer is undergoing "financial issues" since the collapse of the publisher Brash Entertainment, leading to the cancellation of a project and unpaid wages.’ This is basically saying that ‘Factor 5’ has discovered that their developers have been undergoing financial issues because of the closing down of their publisher ‘Brash Entertainment’. This has lead to the shutting down of the project and has resulted in a lot of unpaid wages.
Kath Brice explains that ‘Lower the price of the PlayStation 3 would have made a difficult year even worse for Sony, according to Epic Games' vice president Mark Rein.’ This means that the businesses had a hard time in getting the funding in order to make a profit on the PS3. This is why in the future the Playstation and Xbox are both releasing a full motion device. The Playstation’s is called ‘Wand’ and the Xbox’s is ‘Project Natal’. These two projects are being created to ensure there are no financial issues; basically they are playing it safe, because both companies do not want to release another console e.g. PS4, because at the moment not everybody has got a HDTV television in their home. This will be needed for the new consoles. If people have not got these televisions in their homes is causes the problem that Playstation and Xbox aren’t going to sell that many console as the customers won’t have the facilities to support them. That is why they are going with the motion projects.
Kath Brice. (2009). Rein: Sony financial issues prevented PS3 price drop. Available: http://www.gamesindustry.biz/articles/rein-sony-financial-issues-prevented-ps3-price-drop. Last accessed 11 December 2009
James Lee. (2008). Factor 5 face "financial issues". Available: http://www.gamesindustry.biz/articles/factor-5-face-financial-issues. Last accessed 11 December 2009.
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