We catch up with founder and managing director Luke Keighran to talk about how Merge Games embraced the Switch, why special editions of PC titles are still relevant and why indie games saturation is a double-edged sword
What’s your overarching strategy and how has it evolved over the past few years?
When I started Merge Games, the business’ focus was primarily on distribution. I had built up a large network of contacts in territories across Europe, Africa, Asia and Australasia. I used this network to introduce boxed product into the markets; collector’s editions such as Limbo and Terraria were particularly successful.
Following that, Merge moved into publishing, initially into the digital PC marketplace and then onto console. We’ve started console retail in 2016 with Aragami on PS4, and in 2017 we added full US distribution. So in just a few short years, we’ve grown into a major indie publisher that offers digital and retail solutions globally.
Tell us more about your US distribution activity.
Our first PlayStation 4 retail offering was Aragami, a ninja stealth game from Spanish developers Linceworks. At the time, we decided to licence the game to sell into North America. While it was a good solution, it was obvious that we would benefit from handling the process ourselves. We now manufacture and distribute directly into the US into the likes of GameStop, EB Canada, Walmart and Target as well as looking after the indies. There’s definite risk involved and we are careful which titles to put into the market; but we felt the rewards were there if we got it right. The first game we manufactured, Yonder: The Cloud Catcher Chronicles on PS4, has already performed well and we are already looking at re-orders after initial sell-in. Looking at the size of the North American market in relation to our business, it was certainly the right move.
So 2017 is shaping up quite nicely for you, then?
Since we started back in 2012, we’ve seen constant year-on-year growth. 2017, however, has been something of a landmark year in which we have managed to more than double our sales revenue from 2016.
What’s more, with a couple of months still to go before year-end, we’ve still got two of our biggest projects to get out the door – The Binding of Isaac: Afterbirth+ (pictured below) on Nintendo Switch and Riot: Civil Unrest on PC.
What other projects do you currently have in the works?
We’re currently very excited by the Nintendo Switch and have half a dozen titles lined up for digital and retail release in 2017.
The Binding of Isaac: Afterbirth+ on September 7th will be one the most important distribution releases in Merge’s history. We’re going to bring it to PlayStation 4 by the end of the year, too.
I think we have a great mix of titles, ranging from known IPs to hidden gems we manage to uncover, such as The Long Reach. Developed by Painted Black Games, a Russian/Ukrainian team, it’s a thrilling horror story, flavoured with sci-fi ideology, psychological context and a sceptical view on the human psyche.
Finally, we’re set to release Riot: Civil Unrest (pictured below) onto PC, billed as part RTS and part simulator. The game places you in some of the world’s most fractious disputes. As civil crisis deepens and inequality tears the very fabric of society, the discontentment of the masses manifests itself in violent public disturbances and civil disorder.
How has the Switch impacted your business and what are your plans for this platform?
We’ve embraced the launch of the Nintendo Switch and plan to have a growing portfolio of titles on the platform, starting next month with The Binding of Isaac: Afterbirth+ and soon after Unbox: Newbies Adventure. I foresee the platform becoming a cornerstone of Merge’s business with titles launched digitally and into retail. It’s still early days and the platform is still finding its place in the market, but Nintendo’s approach is welcoming and inclusive and we are big supporters of Nintendo Switch.
You also specialise in special editions with your Signature Edition Games – how did this come about and is it growing?
Special editions of PC titles are something we hit upon quite early on. We’d seen success with titles such as Limbo, Space Engineers, Terraria and Gone Home. As our catalogue grew, it seemed a natural progression to move onto console, offering a quality package that collectors desired.
We started with titles on the PlayStation 4 and soon discovered that there’s a vibrant fanbase of Vita owners out there. Our first title on both formats was Slain: Back from Hell, and we’ve been pleasantly surprised by how good the Vita numbers have been – we’ve got two more Vita projects rolling out before the end of the year. So, the Signature Edition side of the business is developing nicely. We’re being conservative with it, though. Rather than just release a slew of titles, we look to offer the consumer a level of quality with bonus collectibles that add value.
Is the indie games market getting increasingly competitive, both in terms of signing and then selling titles?
Absolutely, and it’s a double-edged sword for indie developers and publishers. Once upon a time, there were plenty of barriers to entry for smaller indie devs. As those have fallen by the wayside, we’ve started to see a real kaleidoscope of projects. One thing’s for certain – the overall quality of games we get sent has risen each year. The downside is that the market is saturated with content – there are some fabulous titles out there that would have been huge hits three or four years ago. Now they struggle, which is a terrible shame, and this is mainly due to saturation.
As a publisher, we’re not immune from the effects of the deluge of titles, either. There are so many factors to consider when we sign a title; the dev’s experience and track record, our commercial knowledge, the state of the marketplace and trends within it and so on. Even if you can get close to ticking all the boxes, there’s no sure fire guarantee that a game’s going to be a success.
Do you think Steam is improving as a platform, and have you benefited from recent changes?
As the premier store for home computer titles, it’s our role to embrace the platform and work with them. Sure, we might sometimes question why the platform has changed, but it’s too easy to criticise Steam. It may be over simplifying things, but quality titles win on Steam. The platform thrives because of its community. Regular interaction with the userbase is the key and I believe Steam is working hard to maintain a strong connection with its customers.
What are the challenges and advantages of being a publisher, a distributor and a retailer?
We’re in a unique position where we can offer a comprehensive suite of solutions. We’re constantly adding to our list of services; distribution into North America being a recent example. The gap between the triple-A titles and indies is widening and we find ourselves sat somewhere between the two camps. The saturation of the marketplace can open opportunities, and although life moves very, very quickly, having an agile team and being able to react quickly is a big bonus.
What are your ambitions in the long run?
I see Merge Games here for the long term. We’re aiming to maintain the growth of the business, focusing on working with great developers and interacting closely with consumers. By understanding what the market demands, we can deliver better services, products and results.