The once-booming market for lucrative deals between major gaming platforms and independent developers appears to be cooling down, according to creators behind some of the indie scene’s biggest recent hits. In an interview at the Game Developers Conference in San Francisco, the co-founders of Slay the Spire studio Mega Crit and Darkest Dungeon’s Red Hook Studios signaled a significant downturn in the substantial deals that have helped smaller teams secure funding and break into gaming’s mainstream over the past few years.
“I talked to at least five small teams, like 35 [members] and under, during GDC, and they’re like: Cuts, cuts, cuts, funding canceled, talks that were going on for a year, canceled,” said Casey Yano of Mega Crit. “It sounds like it’s s**t. We’re definitely very privileged to be able to self-fund. [Otherwise] I’d be very, very, very scared right now.”
Yano’s co-founder Chris Bourassa, the creative director of Darkest Dungeon, echoed similar sentiments. “The Gold Rush is over,” Bourassa stated, referring to the era of major platforms like Xbox Game Pass and the Epic Games Store aggressively pursuing exclusivity deals and bringing independent titles to their services through substantial payouts.
“I come from the Northwest Territories. The town I’m from was built on gold, and then they found diamonds further north. Maybe another paradigm shift is waiting for us, but I definitely think the scale of the deals I’m hearing about is significantly [diminished] from the big swinging days. Certainly we got our Epic [deal] at the right time.”
The deals in question have become commonplace as subscription services like Game Pass sought to bolster their libraries and the Epic Games Store attempted to challenge Steam’s long-standing dominance on the PC gaming market. Microsoft has reportedly spent millions, sometimes even hundreds of millions, to bring major releases to Game Pass at launch.
Court documents from the FTC’s ongoing case against Microsoft’s acquisition of Activision Blizzard revealed that the company valued a potential deal for the upcoming Baldur’s Gate 3 at just $5 million, while being willing to pay up to $300 million to add Star Wars Jedi: Survivor to the service.
Epic Games, meanwhile, has invested heavily into securing timed exclusives for its store front, paying out $210 million in minimum guarantees during the first wave of Epic Games Store exclusives in August 2019 alone. As of November 2022, the store remained unprofitable, with Epic projecting potential combined losses of up to $965 million through 2027.
For many independent studios, these deals provided a crucial safety net, allowing teams to make back their development costs even before a game’s release. Obsidian’s Josh Sawyer cited Game Pass as pivotal in allowing for the creation of the studio’s unconventional RPG Pentiment, as it freed the developers from worrying about immediate returns on investment.
Some figures in the indie scene, however, have expressed doubt about the long-term viability of this model, with Dusk creator David Szymanski stating that “if it or any similar subscription service overtook the current store model, I’m pretty sure that would be the end of the indie market as we know it.”
As major platforms appear to be tightening their belts, indie developers may have to adapt to a changing landscape. In an effort to help bolster the indie scene, Red Hook Studios, Mega Crit, Dead Cells DLC creator Evil Empire, and several other prominent indies have banded together for the “Triple-i Initiative,” a digital showcase of more than 30 independent titles scheduled for April 10th.
With the once-plentiful wellspring of major platform deals running dry, it may signal a necessary paradigm shift for the indie development community and the start of a new era of self-sufficiency and grassroots promotion.
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