CoG/HG business model

That’s the main takeaway I want people to have from this. We quibble over percentages and minutiae but never let it detract from how most/all of us writers like this place. As evidenced by our continued presence here.

That being said, one thing I do want to mythbust is that there’s a lot of games that never reach profitability. To quote a Stephen King short story collection title, everything’s eventual. Unlike a physical book publisher, there are not continued costs to a story being available (beyond minimal amounts for hosting it). They pay the marketplaces (and for stories they know will be stinkers, that’s just two these days, Apple and Google; Amazon was never much of anything and now stories don’t release there at all), and for a Hosted Game, that’s most of their cost. Then it sells. And if it sells poorly each month, it still sells. A bad or unpopular game can take years to reach profitability. But most of them still will.

Shocking truth and mild self-own: NPT has likely reached profitability for the company. My estimates put it in the lowest 25% of HG titles by overall earnings. It did so poorly that Day After still managed to be under the financial cut that meant games qualified for the Underrated poll, and it has outearned Toaster by a literal factor of five despite being out for one year compared to Toaster’s 5+. But Toaster’s total net (meaning after the marketplace cuts) in five years has been $2,227.65. Subtract out the $558.16 that I got from that as royalties and it’s $1,669.49 to the company. Going by the $1k estimate it costs them to put a HG title out, that’s still way over the mark. This means that even a lot of the unabashedly dud games pay for themselves. Now, obviously the company could not survive if every game was like this. It’s technically profitable but still was by no means a success, and it’s more paying into the company coffee fund than literally keeping the lights on. But it does mean that the hit games aren’t paying for the duds. Most of the misfires still pay for themselves, and the profit from the hit ones is just that: pure profit. I mean, aside from the obvious and undoubtedly substantial costs for employee salary, benefits, site and app infrastructure, and so on.

Any suggestion of royalty increases needs to be rooted in reality. It shouldn’t be us demanding the lion’s share of the profits, both because that doesn’t respect what the company has constructed and because it sure as heckfire ain’t gonna happen. We still need this place, and even the people who don’t likely did at an earlier point in order to get where they are now. But it does need us as well, and a bigger piece of the pie helps reflect that.

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