Analysis: Are Long Development Times Worth The Money?

[In this Gamasutra editorial, editor-at-large Chris Morris looks at Rockstar's Red Dead Redemption and its much-delayed development cycle, examining whether taking your time in completing development on your game makes creative and business sense.] Before Red Dead Redemption became the year’s best-selling console title to date (and an earnings savior), Take-Two Interactive Software took a lot of heat over the game’s five-year development span. To be fair, it seemed legitimate at the time. Take-Two (and especially its Rockstar division) has never been the speediest of companies when it comes to getting games on store shelves. By the time Redemption finally shipped, expectations were low among investors (and, to some extent, players). Ultimately, it proved to be the catalyst that Take-Two says will propel the company to report its first non-GTA year profit in a decade. So it’s time to turn the table on those critics. Are extended development cycles, in fact, justified? It’s not a black and white matter, of course. Was Daikatana’s extended build time worth it? Obviously not. Will Duke Nukem Forever be worth a 13-year wait? It’s hard to imagine, no matter how good the game turns out to be, but we’ll find out next year. The list of titles that have stumbled after long development cycles is extensive. Games like Tabula Rasa and even Alan Wake spring to mind. But for every horror story, there’s a Half-Life 2 or Grand Theft Auto IV that resets the bar for the industry. Investors, as you might guess, don’t care too much about that sort of thing. They care about sales. And while a slow simmering game that turns out to be a smash is great, in the back of their minds, shareholders still do the rough math to determine how many other titles could have been made in that time – and whether they, collectively, would have had a higher profit margin. It’s a problem that has haunted – and will continue to haunt – Take-Two. While investors are a bit more patient with games that have Grand Theft Auto in their name, they get antsy when something like Mafia II takes six years to complete. And they’re starting to feel the same way about Max Payne 3. The issue boils down to art versus business. Great works take time, but for every year a title is under development, it becomes harder for a studio to recoup its investment. And these days, as work is about to begin on the first round of titles for next generation console systems, publishers are likely to see their costs spike once more. And that could make it harder for them to justify giving a marginal or questionable title more time to bake. Activision, while it has its fair share of detractors, has come up with a viable solution to the extended development cycle issue. By rotating a franchise through multiple studios, developers have time to craft their game, while the publisher keeps its investors happy with regular releases of major game lines. The downside, of course, is the quality of the game is less consistent. It’s a model more companies are starting to pay attention to, though. In July, Capcom announced it plans to increase the number of titles it ships each year – by cutting development time on its flagship titles, such as Resident Evil, from four years to two years. The move’s meant to stabilize earnings after Capcom saw profits drop 73 percent in fiscal 2009 and will likely result in a fair bit of outsourcing to external developers. Capcom could be the first of several publishers to go this route. As game development costs continue to rise – and the industry faces increased competition from external forces, such as Apple’s iOS devices and the expanding footprint of social gaming – it’s going to be harder for executives to justify cycles of four, five and six years unless every single game that takes that long is a blockbuster. For developers, that’s undoubtedly frustrating news. The race to set new standards of excellence is a marathon, not a sprint – but bean counters are only concerned with the bottom line, which is inherently focused on the short-term. Stock prices throughout the video game sector are flat, though. And some iPhone games, like Angry Birds, are starting to become as well known as select console franchises. That’s going to keep those bean-counters in power positions -– and could continue to reshape the timeframes developers are given to make games for years to come.