The recent strike authorization from SAG AFTRA has a lot of developers talking about unions. Game developers can have some pretty diverse political leanings ranging from my own breed of liberal feminism to the vocal proponents of Pick-Up Artistry, libertarianism, and constitutionalism. Hell, there are some people in the industry who will invoke the founding fathers in the same breath that they’ll condemn Secular Humanism. (If you don’t know why that’s problematic, you have some research to do.)
Many years ago, I turned down the opportunity to join SAG’s live theatre cousin, Actors Equity, and I’ve never regretted the decision. I was a stage manager at the time as well as a sometimes fight director and actor. In addition, I helped run a financially disastrous show called Ochen Chotto Spiel which was a spin-off of the Neo-Futurists’ Too Much Light Makes the Baby Go Blind. Theatre and I go far enough back that I spell it the pretentious way.
When I read SAG’s demands for their new standard contract, I alternated between nodding along sagely and actually laughing out loud. Most of their demands came across as perfectly reasonable, but one of them in particular came across as so screamingly childish and uninformed that I had assumed they were joking. Apparently, they were not.
Let’s have a talk about cost-per-install, development time, and the laughability of sales numbers.
Before I proceed, understand that I am getting the phrasing of SAG’s demands from their own site and the FAQ they have distributed to their members. The phrasing they use on the site is clearly not the legally actionable phrasing that will be used in any contract but rather propaganda intended to lead their members to vote a particular way. That’s not a knock against the text: it is an acknowledgement of its goal.
The Numbers Game: Development and Marketing costs
The laughable part of SAG’s proposal originates with their terminology surrounding residuals. From their FAQ: “We structured our proposal to trigger at 2 million units, the point we would regard a game as a blockbuster… As for the big games, we know the companies already budget for sales-based bonuses for many of their employees.”
In SAG’s other explanations on the topic, they clarify that the 2 million number applies to purchases, paid downloads, or unique subscribers to online games. They also clarify that, yes, this number applies across all platforms, including online-only and mobile. They recognize that mobile is a growing space with huge revenues.
“…the point we would regard a game as a blockbuster,” is the telling sentence of capstone ignorance. Say that to anyone familiar with the development costs or sales across the diverse business models and platforms SAG hopes to apply the 2 million number to and they should chortle with delight. That number, the unit count, has nothing to do with a game’s success.
If Red Dead Redemption or GTA V had shipped only 2 million units, they would have been such crushing failures that the Houser brothers would have spent their vast fortunes to have the dev teams rounded up and sent to an island where they’d be hunted for sport. The same can be said – with the Housers replaced appropriately – for every Call of Duty game, every Bioware title, and almost every MMO.
In addition, once free-to-play games are included in the accounting, the 2 million number becomes even more meaningless. Free-to-play games are a success when their cost-per-install (approximately how much spending it takes to acquire a new user) is expressed as a fraction of average lifetime-value per user (LTV). If cost-per-install exceeds LTV, then 2 million “unique subscribers” is a death sentence rather than a measure of success. The number of installs is a factor in those numbers – because math – but the arbitrary 2 million number is completely meaningless.
If you want a simple illustration for that, go check out any week’s Top Downloads in your chosen app store then compare that to Top Grossing. Sometimes they coincide. You definitely need some time on Top Downloads before you’ll reach Top Grossing, but being on Top Downloads does not make a game a success.
Saying that 2 million units makes something a blockbuster just makes you look foolish, and you don’t want the people sitting across the negotiating table to think you are children. There are serious safety issues on the table, and you don’t want them going unaddressed because you can’t be bothered to do any research.
That second thing
“As for the big games, we know the companies already budget for sales-based bonuses for many of their employees.”
You drastically overestimate how common this is. You particularly overestimate how common this is for contractors.
It is all too common for companies to tie residuals to market performance of a product, but – as has been widely discussed elsewhere – this is rarely based on direct counts of sales. In fact, development houses and publishers take great strides to conceal what the thresholds are for bonus payments. If you are a developer in the games industry, and your livelihood relies on a bonus check, then you are a damned fool.
Most likely, you’ll never see that bonus even if your game is a success. Some fluke of arithmetic will result in your top-selling game failing some arcane and invisible definition for “success.” In addition, you will certainly not receive any kind of residual if you are not currently employed at the company and currently contributing. Oh, and if it looks like your most recent product is going to pass that success test, there’s a good chance you will be laid off before the first payout.
The men who decide to terminate your employment will probably be given bonuses for reducing costs prior to the bonus payout. The great development machine will lumber on without you.
Dear SAG, you may detect some bitterness. I fully expect you to come to some sort of settlement regarding residuals. Some nice gentleman at the table, once they are done laughing, will strike through your childish measure of success and write something intelligent on the page. That’s fine. That’s going to play out.
The next big hurdle you need to cross is that the developers on games are not treated anywhere near as nice as you are demanding your actors be treated. You are demanding a bare minimum of human decency, and you seem to think you’re going to find it. We, the people who work 40, 60, 80-hour work weeks for years straight to make a game, don’t get that kind of treatment. We’re nameless serfs toiling to grow product. After the harvest, we’re just obstacles on the path towards a payout to shareholders.
A lot of developers see your demands, and we get angry. We want to be treated with the same respect. We want to have the slightest hope that our hard work will correlate with money in our pockets. We hope that earnings will follow quality.
We see your demands – even the poorly phrased ones – and we see a bravery that we lack.
We huddle as cowards who know that even saying the word “Union” can lead to blacklisting. “Collective bargaining” is a one-way ticket to homelessness, starvation, and then death.
I hope you succeed. I hope that when your members leave their final recording session after a day, a week, or a month working on a title, they take the time to be kind to the people that have toiled on it for years. We don’t get much kindness, and we will cherish what you give.
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