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Discussion in 'Online Game Development' started by Joker, Sep 1, 2010.
The title says it all.
It depends.... from as little as nothing, to millions
...though in reality nothing is free of course. Maybe it's better that I give some examples.
The average income of someone working in the ITC sector in the Netherlands isn't very high, the monthly salary is about 1200 euro gross. Normally speaking a development team has about 6 men, the development process usually lasts about a year of a big game or mmorpg, so then you're looking at overhead costs of say about 86,400 euro. However if you're thinking big like WoW with a development team of more than 30 men, then that's at least 432,000 euro, assuming low salaries (which is unlikely). But we haven't mentioned the servers yet. You can get a new one for as little as about 1200 euro. The capacity of a normal server is about 10,000 users. So if you're looking at a capacity of say something like that of WoW, then that's a capital goods costs of 1,080,000 euro at least. Then there are write-off costs, insurance premiums, and purchases of real estate or rent. If you're thinking small, then rent is the option, if you're thinking big, then rent isn't an option. In case of rent and such, then all the premiums, rent and write-offs, can cost you about 22,000 euro per year I reckon. If you're purchasing real-estate however then the cheap option at least in the Netherlands is to buy corporate real estate at a business park, which can cost you anywhere to about 300,000 or 400,000 euro. While normal real estate keeps its value, this isn't the case at business parks, and you can expect it to be pretty much worthless after a period of 10 to 15 years, so that's a write-off of 30,000 per annum at least. Then there are administration costs, at full employ, it will cost you about 60,000 euro per year I reckon. And of course there are taxes, like VAT and such. So for an mmorpg like WoW, the fixed costs are about 1.5 million euro minimum and variable costs at least a third of the fixed costs.
And then there is marketing of course, which is probably the most expensive thing of all. Just one measly commercial on prime-time television during programs like a huge and important football match can set you back for 200,000 euro. Just how much money Blizzard spends on marketing I really wouldn't have a clue. That's anyone's guess really, but it's probably an obscene amount of money. Though I expect hiring Mr. T's mohawk wouldn't really be that expensive in relative terms, since he also works on the homeshopping network.
Of course WoW has about 11.5 million subscribers, but suppose they pull out of China and have full subscribers at the cheapest level, and suppose blizzard gets at least a 40% cut of that retail level then you're looking at an income of say 36,000,000 euro (of course the turnover is much higher than that, which would be more than a billion in US dollars (that's more than a tiny European state, or the poorest of African states)), which would more than offset the overall costs including marketing I think.
But suppose you're looking at an average mmorpg of commercial value, say one of the smaller competitors of WoW, then overall costs would be about 140,400 euro per annum, excluding marketing. I doubt that kind of mmorpg spends a lot on marketing, as they'll avoid using prime-time television adverts, they'll probably do internet adverts and papers and magazines and billboards, but even the marketing costs, would be high I think. Just one measly paper advert in a local paper can set you back a few hundred euro's. Placing a small advert in a games magazine would be twice as much I reckon.
Then there are the really cheap alternatives of setting up a small mmorpg. Suppose you're an indy developer, then overhead costs aren't there. You also wouldn't have any write-offs, marketing would probably be through word of mouth, so no marketing costs either, though maybe you might have placed an advert in a highschool or college paper. The only real costs you have are the servers or hosting. If you're looking at a good virtual host, it would set you back for about 70 euro per year, while a really cheap dedicated server costs you about 400 to 600 euro per year. If however you get as far as collocated hosting then it may cost you about 3,600 euro per year. The cheapest host I could find was one that costs about 20 euro per year (about 40 US dollars). Of course you can also just purchase a domain and host it on your own computer (the cheapest I could find is 8 euro), and if you're looking to develop an mmorpg with the latest 3d graphics and such you can always burn a few CD-ROM's or DVD-ROM's. Wholesale you can get a package of twenty for as little as 3 euro (15 cents per disk). However those aren't the actual costs, remember you also have to have your own computer, if you got it from your parents, then it's free of course and then it's basically is what you call peculium.
So to answer your question, it's in the range of anywhere from about 40 US dollars to several millions, depending on what size and quality you're looking at.
it all depends how much effort you want to put into it, how many people you want to hire, people who you are going to pay to be specialized artists in drawing your ideas, how you are going to get the game out to the public after you publish it and who are you going to hire to do that?
all the things necessary to make a successful MMO. theres more I just listed basic stuff =p