Interview: Breaking the Waves - Doug Whatley and BreakAway Games Get Serious

Breakaway Games has been around since January 1998 as a splinter group from the defunct ABC-owned development group OT Sports. As an early pioneer in the “serious games” industry, which comprises games with non-entertainment purposes such as training and education, BreakAway is in a unique position as one of the industry leaders. Of the five AAA budgeted serious games in development, the company claims, BreakAway is responsible for three. The most visible patron of serious games is the U.S. military, but these games have multiple applications. BreakAway’s serious game, Crate, an underwater diving simulator, is currently in use by both the Navy and the healthcare industry, for vastly different purposes.

Speaking to Gamasutra, CEO Doug Whatley expresses unbridled optimism for the future of the genre and its importance for the game industry as a whole, given his company’s status in the market.

Gamasutra: Can you tell us something about the history of BreakAway?

Doug Whatley: In January we'll be seven years old. We started in January of '98. Previous to BreakAway, I was the director of product development for OT Sports, which did Monday Night Football, and Indie Racing League. It was a company originally owned half by Microprose, and half by ABC Sports, but along the way with Microprose's problems, ABC wound up owning the whole thing. And then Disney bought ABC, so we wound up being owned by Disney. And they didn't really want us. *laughs*

At the time Disney was really just focused on its own studio with kids titles, and didn't want sports games. So Disney closed the studio, and none of us wanted to move to LA, so I took my development team, the core of it, and started BreakAway.

We started out intending to do sports games, because at the time we had a couple of award-winning sports games on the shelves, but you know how the sports game market has narrowed over the years, and it got tougher and tougher to find sports games that they wanted a third party to do. A lot of us, including myself, have a background in board games - sort of did it as a hobby over many years. And through connections with that, I knew some people that worked with the military, and they had projects where they wanted board games that the military was using, computerized.

So we had a couple of those projects to sort of pad the budget in the early years, and got to really know working with the military - there's a lot to that that you don't think about, both in terms of doing the contracts, which is very difficult and time consuming, a ton of paperwork, and also just regulations, and what it takes to work with the military. As we learned that, we also started to see how really backward they were in terms of their training software, and just how much of an advantage the games business had over the military. So we started to take advantage of that, and actually look for places to take the technology that we created for our games and look for ways to repurpose it and sell it to the military. BreakAway's done for the most part PC stuff; city builders and strategy games, so a lot of that just fit really naturally with military planning and those types of projects where they have a need.

GS: so you basically started with serious games, in a way?

DW: Right, and we didn't really think of it as serious games, just another revenue source. You know the games industry really attracts the best and brightest of programmers and artists, and all of us have other interests as well, so it was very fulfilling to work on projects that were really important and had some meaning. We just sort of build on that, and about three and a half or four years ago, the company made a concerted decision that we were going to really turn ourselves into a serious games company. We hired some business development people specifically to target the government market, we began to look at other segments, like medical simulation, and stuff where what we did would be of value as well, and began to sort of build on the reputation that we had built within the military. And that was just perfect timing for the wave that's hitting now, where serious games are a hot topic - we were just well established in the genre at the right place at the right time because of that.

GS: How are serious games as a business model? Can you be self-sufficient?

DW: Oh yeah. In general, I'd say that it's more profitable than the games business unless you have a really big seller of a game.

GS: Are budgets smaller for serious games?

DW: No that's really not true. What you'll find is that to get the big budgets, you usually have to do a smaller budgeted prototype. Because there's almost a three-tiered funding, especially to the military, but to all of the government, where the first funding is very small, but they'll pay you good money to do a design document and get a plan. If they like the plan then they'll pay you a couple hundred thousand dollars to create a prototype, and then if that gets well received, then there are many millions of dollars to create the full project. What really kills most game companies is that those three phases are not contiguous. So you'll do the design, and it may be six months before they decide that they actually want to fund the prototype. Then once you've done the prototype, it may be six months or a year before the big project gets funded.

Just one of them is not really a good model for a game company because they can't afford the downtime in between them, and with the government you just never know whether something will get funded or not. So one of the things we've had to do to really make ourselves a stronger company in terms of serious games is we've actually had to grow bigger. Because you need a whole bunch of those projects in the pipeline, and you have to get good at scheduling and overlapping them, and filling the gaps with other phases of other projects.

GS: So the budgets for these games can go into the millions?

DW: I would say that the budgets for major serious games are the equivalent of game development budgets. And we're right now - I can't say too many names - but we're right now doing three serious games that each have AAA-levels of funding.

GS: Is everything commissioned, or do you also develop concepts or demos and market them?

DW: You mean like do our own R&D, create things and then solve them? The majority of the work we have done, and I think most of the serious game stuff is commissioned; it's sort of work-for-hire where you get to keep the IP. That's the one advantage of doing a lot of the government work, is that you can keep the IP yourself.

So we've done budgets that were multi-million dollar games, and they just wanted the game - we kept ownership of all the technology, and all of the code. So that has two really important aspects, one is that if there are commercialization chances, you can go make a game out of it on your own; you don't really have to worry about anybody else owning the IP, and if you want to use it for a different governmental agency or something like that you're free to do that as well. So there's good revenue from owning that IP, but the other thing about is that since you own the IP, if they want to do a version 2, they have to come back to you. So it guarantees you downstream revenues if they like the project and want to keep adding new things to it.

GS: Do you ever use your serious games IP to make consumer titles?

DW: We have a game in the works right now that came out of IP from one of our serious games. We try to balance ourselves 50/50, where it's 50 percent consumer products that are entertainment, because we don't really want to lose that game entertainment sensibility, that's what got us where we are. That's what they're looking for, is that creativity and that exposure to the public that we have. So our revenues - we try to keep it 50/50, where 50 percent comes from the consumer market. It's been tough, since the other side is so successful, we're having to grow and take on more game contracts to try to balance it out. But we're currently working on three different commercial products right now.

GS: It seems as though your consumer side is less revenue-based than reputation-based?

DW: Well it's a couple of things. It's to keep up the organization as a game company, but we also hire exclusively out of the games business. Everyone here came from the games business and wanted to get into the games business, so even when we get into serious games, people want to periodically do entertainment stuff. We have to keep that around to keep the employees happy. We do like doing games as well.

GS: Since you have grown, do you ever shift teams around from doing serious games to making consumer titles?

DW: Yes, we do that.

GS: So in addition to military and government applications, are you also interested in healthcare?

DW: Yeah, we've made a major push into healthcare, and we've done stuff outside of the military as well. I think the military has just been ahead of its time in terms of the large budgets and everything. We're just now starting to see Fortune 500 companies that will spend five to ten million dollars on a training game, whereas the military has been willing to do that for years.

GS: As far as multi-use IP, who's using your Crate product?

DW: There are several different groups. The Navy's using it, but we're also using it in healthcare, interestingly enough. We're working with a group that is doing a study to prove that virtual reality can minimize the awareness of pain, especially in children. So we're working with a group that works with a lot of kids that have leukemia or cancer, and have to get chemotherapy treatments once a week. And so by putting them into a virtual environment where they can do something while they're getting the treatment, which is fairly painful, they notice the pain less.

GS: So how specifically is it used?

DW: Well what we do for the underwater one is we put a headset on them so they're in the virtual environment, and put on earphones so they're sort of completely immersed, and they can swim around as a scuba diver and find things - you know, treasures and things like that. And that's the intention with that - to put them in different environments, and underwater is particularly attractive because it's pretty relaxing as well. So it has the added benefit of not being too stress-inducing.

GS: So can you say anything else about your current projects?

DW: Ancient Worlds is a city builder game based in ancient worlds. *laughs* I'll just describe it as a next-generation city builder. We're doing major projects right now for Northrop Grumman, Lockheed Martin, for Booz Allen Hamilton, we're working with the Army and the Navy, and we work with all the major publishers on games.

GS: Consumer game companies often have types of games that they're known for. Does that kind of specialization or knowledge thereof exist in serious games?

DW: We really haven't had that experience. Part of it is that the people who are contracting for serious games really don't know much about the games business. So they're not necessarily as aware of the subtleties of what's the difference between one type of game versus another type of game. They may know strategy games, but RTS versus turn-based, they're not really going to, at least up front, know the subtleties there. They come to you wanting your creativity, not necessarily wanting what you've done in the past.

GS: Do people come to you because you've been established in this field for so long?

DW: Well absolutely, I mean we still get the majority of our serious games work sort of through word of mouth. Within the military, and the government, and even within medicine, people move around a lot. In the military people get transferred every two years or so, doctors and hospital administrators change jobs a lot, so there's a lot more mixing in those environments, than business in general, I think. And so its not unusual for us to get a call from somebody we worked with two years ago, and they're in a totally different place, and they see a problem that they know we can solve, and they point us out to the people they work for now. So that's very helpful, especially in the military. You never want to burn your bridges. You want to do a good job for somebody so that at their next command, they'll give you a call any time there's something that you can do.

GS: Do contractors often give you a specific task and design, or do they sometimes propose a problem, and ask you to solve it?

DW: It's a mix. They often will have an idea of how they want to solve it, but really it's probably more of the latter, where they're looking for us to solve it. Often what happens is - it's not uncommon for us to get a call and we'll go to a meeting and they'll say, "Hey, my kid was playing this game, and I saw it and I though it would be great for this project - can you guys do that?" Well, they're now aware that a game might solve their problem, but it's kind of left up to us to come up with the exact game proposal. And if you're doing a training game that's training… if you're doing America's Army and you're training somebody to be an infantryman, that's got a very narrow focus, but if you're teaching leadership skills to business leaders, there's a whole wide range of game types and styles that you could do.

GS: Can you give an example of how you might do that?

DW: Well depending on exactly what you're trying to teach, you may go back to an old board game that has a lot of diplomacy and strategy in it and make it into a multiplayer game, so that they learn leadership and planning skills that way, or you may take it the opposite way and put them in a first-person shooter, where people have to work together as a team, and learn teamwork skills. So you really sort of have to be creative, while keeping in mind what the client's objective is.

GS: With serious games you don't have ratings, so how do you know if you're being effective?

DW: We get a lot of compliments, and I wouldn't say we've gotten any complaints - what you do get sometimes on the negative side is people that feel threatened by your product. If there are trainers out there that see that your game is training people better than their training class does, they sometimes aren't that happy about that *laughs*. But there's really not a lot of hard-core validation of how well the training from a game works. Everyone is very confident that it works, and we're all really rushing right now, along with academics, to prove just how much it works. And we're looking forward to the day when we have a lot of really detailed studies that show 30% increases in efficiency and those types of things. But right now we're still in a place where the companies that hire us kind of have to take a leap of faith, and we're aware of that because that can't last forever - we have to do a good job, and once we deliver it, we have to be very willing to stick with them and work on it, because the game may work but it may need some fine tuning and stuff to really make it work, and right now we're only interested in hitting home runs. It doesn't do us any good to just do an okay product.

GS: So what keeps a company from making a slapdash serious game is mostly that the business is based on word of mouth?

DW: Yeah, well we're trying to change that, we're really ramping up our marketing, and trying to change that in the future, but yeah, the majority is word of mouth right now.

GS: Would you say that this a good market for independent game developers to get into?

DW: I definitely think that's true. You were asking earlier about the size of projects, there is - I think - a misconception about there being only small projects. There really are a lot of large projects, but the other advantage is that there is a really big range of projects - there are a lot of small projects out there too. And that allows a lot of people to get into the business. I mean part of the problem with games business right now is that the game contracts have gotten so huge that it's very difficult for a small group to break in, because you just don't find publishers giving a million dollar contract to do a small game, it just isn't done. But that is done in serious games. And you can find a ten thousand dollar contract up to a 20 million dollar contract. So it allows you to both get into the business, and it also allows you to scale your business to what you're comfortable with, I mean some people just like working with small teams, and it's a great business for that.

GS: Anything else you want to mention?

DW: I would like to reemphasize that I disagree with those guys that speak about the (small) size of the serious games market. I think it's both larger in terms of dollars than everyone realizes, and it's also larger in terms of the scope of projects. I think right now when people think of serious games, they think of you know, Doom being modded and somebody using that mod. But if you really look at things, the serious games market is much more diverse than that; there's a lot more custom work and a lot more work that's being really done behind the scenes than people realized.

[An edited version of this interview appeared in the February 2005 issue of Game Developer magazine.]