Publisher 3.0: When you dance with the devil

Mastertronic CEO Andy Payne offers advice on what to expect – and demand – from potential partnerships
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As the saying goes, ‘When you dance with the devil, the devil doesn’t change. The devil changes you’.

I would recommend to every games developer seeking any kind of support, financial or otherwise, to print that ou, put it up on their wall and just glance at it now and again. And always smile.

Smile, because you made some key choices which means that this saying simply does not apply to you. It doesn’t apply because you made the right choices as to who you decided to work with and why you chose them.

I have written and spoken a lot about Publishing 3.0 in the last 12 months and how things have and will continue to change in the games industry. Most of that change is delivering far more democracy and control to the creators and makers – especially in a frontier-free, digitally connected global market. But, along the way, most game makers will need to seek partnerships in order to help them get more from their game, usually in the form of commercial and creative considerations, and hopefully success.

Trust, as usual, is the key word in all of this. It goes without saying, but can only be earned and established over time. So, when you are thinking about making your game, give real thought and time to who you want to work with. Time and research will ensure that the ‘want’ never becomes a ‘need’.

So make a list of the areas you think you need to seek partners. You should think about the specialist skills you will need. Be it platform support, technology, creative services, marketing, communications, logistics such as QA testing and localisation, legal and finance.

I have and will further cover all the other areas outside of finance and legal in my other blogs. Finance and legal are vital and they do go hand in hand in so many ways.

Coming to an agreement

Let’s do the simple things first. You will need legal help to set your company up – there are lots of online resources to help you, many are free. Have a look at the standard games industry contracts on the UKIE site: it is a great place to start and has been curated by the members of the UKIE developer group, so it has great provenance and relevance.

My advice is that you should try and get most if not all of your relationships backed up with legal documents, but be sensible. Don’t use a sledgehammer to crack a nut. If you are outsourcing audio or graphics, a simple contract agreement will suffice. If you get to know and trust your partners of course, even that can be overkill. 

If you need any advice on great lawyers to work with ask other developers, I always find that they will help and will share great, trusted contacts. If that doesn’t work, feel free to ask me and I will let you know who we have enjoyed working with and trust down the years, you can hit me up at andy.payne@mastertronic.com.

But when it comes to signing a financing or a publishing agreement, proceed with care. The devil is always in the detail. A good and trusted lawyer will be essential in advising you on these deals. But as a creator, you must take responsibility for the deal you want to negotiate. This can appear to be a total minefield and many simply don’t want the hassle. If you think like that, glance up to that message on your wall, the one you printed out and think again.

These deals are, by their nature, complex. Fear and greed can sometimes play a major part in driving the relationship. Many games developers fear the publishing process. You may think it is overly complex, full of dark arts and simply too much work. Take my advice: to do it properly takes time, skill, effort, commitment, creativity, passion and some luck. And it takes help. But don’t fear it!

Try to work out what you need from a publisher. Do you need financing and is that for the whole project or just part of it? Do you know what you actually need and have you given yourself any wiggle room? Making games is hard and it takes time. Making great games is harder and takes longer.

Think about who you need to work with and who you want to work with and how much that will cost in cash terms. People need to know when they will get paid, so ideally start thinking about the base financials at the beginning of the project, not half way through or worse still when you have run out of money. Above all don’t fear this process, embrace it and learn to enjoy it and grow your knowledge and experience.

Many games developers fear the publishing process. You may think it overly complex, full of dark arts and simply too much work. To do it properly takes time, skill, effort, commitment, creativity, passion and some luck. And it takes help. But don’t fear it!

Sadly, in my experience, once finance comes into any relationship – and let’s face it most business relationships are predicated on a financial relationship between two or more parties, to a great or lesser extent – greed can be an unwelcome guest.

Remember, there is no such thing as free money. Don’t rely on someone else to solve your financial problems. Ultimately your game and your company will rely on your fans for financial support, but sometimes you need a hand to build that community. One of your biggest fans must be your publisher, should you choose to work with one. Trust me, if they are not a fan of you and your game, then things won’t only get better! In my experience, if a publishing partner is not invested into your game, financially and otherwise, they may not care as much as you do. And if that happens, the relationship will be doomed. So avoid that at all costs.

There are a couple of fundamentals that some publishers, and by no means all, will try and approach the financial side of a deal. Some may want own or joint own the intellectual property, the IP. Resist this always. It is your game and unless there is an outstanding business reason to give up ownership, please don’t.

Bluntly, most publishers and investors will want their investment back if and when the game sells. This approach is perfectly fair and reasonable, of course, but try to ensure that you are both invested in this process. An old friend and mentor of mine, Frank Herman – founder of Mastertronic, sadly long since gone – was a huge fan of legendary investor Warren Buffett, and always said ‘if the other party ain’t got some skin in the game, the deal will never work’. In other words, make sure you know what the publisher will do from a financial and resource perspective.

Indeed, if they are advancing you money against future earnings, realise what that is and make sure you understand it. If they are paying for a lot of things you both agree are needed, it’s only right that they should try and recoup this from future earnings also. After all, no risk is ever guaranteed a reward. That’s why it is a risk!

Making your voice heard

Always ensure that you both understand and have input into the publishing process. Many of the new breed of publishers act far more openly and collaboratively nowadays and that is to be welcomed. The days of knowledge being power are long gone; Google proved this.

You should always have the right to have input into the creative process around marketing your game. That should not only be a right, but it should be a responsibility. Don’t forget to be available and set aside time for this. Yes, it may be a distraction from making your game, but it is a necessary and crucial one! Ensure also that you know how ‘the skin’ will be invested. You should see a proper costed plan and have the right to see the proof of expenditure. That keeps partners honest and builds trust which is the key stone of any successful business.

You also have to decide on what territories you will sell your game in. Whilst we are in a globalised digital market, there are huge cultural differences at play and also pricing considerations which are not to be underestimated. Make sure you discuss and agree a strategy on pricing which you are always consulted on, and around platforms. You may want to give your partner the right to publish all versions up front, or you may only want to grant one at a time, until you have established trust of course.

You should always have the right to have input into the creative process around marketing your game. That should not only be a right, but it should be a responsibility. 

Finally always ensure you also know how you are going to get regular progress and sales reports and ultimately how and when you will be paid your share of revenue. If you are not dealing direct with the platforms such as Steam, Playstation, Google Play, Xbox, Amazon, Apple, Windows or some of the purely digital stores such as Humble, Get Games, GOG, Gamersgate, GMG and about 20 others, then understand that these platforms and stores typically take around 30 per cent of the price paid by the customer.

If you are striking a revenue deal with a publisher, make sure you get the majority of the revenue that is received by that publisher, unless there is a very good business reason why you will share less than the majority percentage.

You should try and get monthly sales reports and a monthly payment from your partners. In the old days of plastic boxes sold at retail, the truth of the matter was that sales data outside of Britain (thanks to Gfk ChartTrack and UKIE) and the US was pretty unreliable and took time to collate and remit. Quarterly reports and payments were the norm, and that often made games developers feel like mushrooms.

It was the equivalent to sitting in a dark and damp cupboard under the stairs and every three months the publisher would open the door and chuck a bucket of shit on you to stimulate growth. You had no idea how your games were selling.

Today is an age of transparency. Make sure that any deal you sign allows you regular sales information and transparency. That may come down to the people you are dealing with sharing sales data frequently of course, but get it in that agreement!

So always be clear about what you want from a publisher or financier, or both. Don’t be afraid to ask around for advice and references. Don’t be afraid to hold out for a fair deal. Fairness is in the eye of the beholder of course, but if a partnership is to work, both parties should feel that they have gained from the deal. If you feel wrongly treated, it is probably because you have been. So speak up, and sit with your partners and discuss and negotiate.

Always remember to keep a constant eye on that print out on your wall. In my experience it will never lie.

Andy Payne is CEO of Mastertronic. You can contact him via andy.payne@mastertronic.com or via Twitter.

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