Modding Community, Game Companies and Profits

They do SO much to improve, extend, enrich and polish any given game. Not to mention unofficial patches which fix the bugs that game companies for * some * reason fail to patch for years.

Let’s take Skyrim as an example – with major mods like Skyrim Redone, Climates of Tamriel and Project ENB, I can easily say that my Skyrim is a totally different game now.

This is before talking about content mods like Falskaar, which add ~20-30% more content to the game.

Lighting and Graphics overhauls like Project ENB change how Skyrim looks SO much that you wont be able to tell you are playing the same game.

After using numerous of these kind of mods, Skyrim vanilla compared to the modded Skyrim looks like a rushed, clunkily-done game from a sinking game studio. And this is saying a lot, considering how Skyrim is a groundbreaking game in itself.

So much that if you check modding communities, gaming forums and the like, you will see console users talking about how they are planning to buy a PC only to get access to the immense amount of mods they can use in their games. That’s no joke – pushing someone to spend close to a thousand bucks to get a decent pc rig only to be able to use mods.

So, seeing how mods and modding community ads MASSIVE longevity and prominence to their games, you would think that the gaming companies would be embracing them with open arms and hugging them with a hug of love until they were out of their breath, right…..

Wrong.

It doesn’t go that way.

Let’s make some MORE money, over the stuff people made for the game for free, over the money we already made from the game

This is their attitude, at best – ‘suck everyone dry some more, as much as you can’.

The Valve & Bethesda paid mod scandal at Steam illustrates the logic perfectly:

Valve came up with a paid mod downloads idea, in which the users would be charged to download Skyrim mods. The modders would be given a pathetic 25% of the payments, whereas rest ~75% would be split in between Bethesda and Valve, who did nothing to create the mod at all.

Its true that Bethesda developed the game engine, and Valve serves the downloads – but there is no way in hell anyone could justify charging for mods that run on the game engine, leave aside the above pricing scheme.

Thinking otherwise?

Ok. Then take a second and imagine that Microsoft asks Bethesda, Valve to pay up ~75% of the profits from Skyrim sales on Windows platforms.

Outrageous? Not at all – in the end, Microsoft developed the software this entire gig is running on, right? From the file system to permissions, from sound interfaces to graphics rendering, entire setup is running in their copyrighted software.

The ‘our copyrighted assets’ legalese that’s being used to charge for mods AND pay modders such a stupid share, could fly either way. The only reason why this sounds so atrocious to you is because there isn’t such a practice and because you are not used to it. However in terms of copyright law, even if the current license of Windows oses do not give way for such a proposition, Microsoft could push this to legally with the next important software update. Leave aside new versions of its oses.

But you are right, it DOES sound atrocious, that is because it IS atrocious.

Exactly the same is valid, in the case of gaming mods.

There shouldn’t be any such ‘fleecing’ scheme of modding community, modders or users.

But indeed, mod developers should be rewarded for the massive effort they are putting, if they choose to so. For what they are bringing to the games are rightfully on par with what the game studios put into the games themselves.

But as we demonstrated above, fleecing users and modders like how Valve and Bethesda thought they could, is not the way to do it.

But how to fix this problem? Is there a solution?

There is. And it becomes evident once you analyze the current situation:

How it is now

Behold the below picture:

Skyrim cost $95 million to make, and was already estimated to be going to make $450 million in revenue just after the launch. It currently stands at a 20 million units sold – add to that DLCs, and go figure how much money did it make since its launch. $88 million of the costs were development costs – take a note of that.

When you make a rough calculation and take out all the costs (including marketing) from even the revenue at launch, you are looking at a figure around ~$355 million in profits.

In short, they made a whoop-ass amount of money.

Now have a look at how much effort was put into Falskaar by its modder :

According to a PC Gamer interview with the high school graduate, Velicky spent 2,000 hours over a span of a year building the 25-hour-long mod as a way of showcasing his skills. It also features a landscape one-third the size of the original game’s continent of Skyrim, new characters, new voices, and new quests.

Falskaar mod adds ~20-25 hours of content, ~30% of landscape to Skyrim.

However you look, we are looking at a mod which added a good chunk of gameplay and content to Skyrim, from anywhere at ~10% to 20%.

If Bethesda had done it themselves, it would cost no less than a good few hundred thousand dollars worth of man-hours.

This is the amount of money Bethesda did NOT spend on Skyrim to add this previously nonexistent content to their game. And yet, they are already gulping the profits from the users who buy their game based on the longevity and content added to it by mods.

Yet, leave aside thinking about any compensation, all that the Falskaar mod developer wants is Bethesda giving him a job…. An expectation which, Bethesda was not at all inclined to fulfill, and did not. But Bethesda has had no problems scheming about charging you for the mod he created, and giving him only ~25%…

Is it too hard for Bethesda to reward this modder with a cash reward?

No, it isn’t.

Actually it is easy to come up with a scheme to reward modders based on any possible criteria, and in the process not only bolster modding community, but also add massive (in some cases, everlasting) longevity to the games which game studios are producing.

You can shell out easily a few ten thousand dollars rewards for such massive mods like Falskaar, Skyre, a cost which is NOTHING compared to the actual costs of having to develop those content additions in-house in the game studio – as evidenced by development costs of Skyrim and many other games.

A major gaming studio like Bethesda can distribute $1000-2000 rewards to countless other, non-overhaul mods easily, and not even flinch. You can dash out $1k rewards to ~1000 modders, with a mere $1 million budget.

These are makeshift and basic numbers for demonstrating the purpose. However the actual business logic would say that you could do much more, given the massive amount of value and longevity the mods are adding to your game, leave aside its sales.

You can came up with any kind of scheme to decide whom to reward, based on whatever criteria you choose – its possible, many different forms and formats of rewarding software development exist, from crowdsourced bug-hunting reward programs to open source development incentivization. So it can be done.

It’s sound business logic.

But its not happening that way.

Instead, the company is hoping to charge you more for free content that is produced by the modders from the gaming community itself, to make even more profits – without giving ANYTHING back into the community, other than allowing for the opportunity to use their platform to make MORE money for THEM.

What happened to $450 million+ profits?

One would say that they would reinvest a portion of those profits into bettering their games, more development and make even better products. At least, this is the tell tale we are sold by the system.

And yet the ‘infinite loading screen’ bug still plagues Skyrim, which is ironically only fixed to a certain extent by the Safety Load Mod, it took a mod – Mod Organizer – to prevent Skyrim from permanently messing your installation due to mods having to be overwritten on game’s and each others’ files, it took Unofficial Skyrim Patch to fix a zillion more issues and problems with the game…. This is even before talking about content, which Bethesda stopped adding to the game after having moved on to new iteration of Fallout.

So basically what we are being sold is bullsh*t – the tale of ‘better games’ through even more profits. Instead look who’s getting the money:

Bethesda is owned by Zenimax, and Zenimax is owned by Providence Equity Partners Investment Firm. With minor shares being owned by the founders and developers of the game studios being owned at the lowest level. Providence Investment firm is a firm with $40 billion in volume with countless shareholders, through the funds it raises from investment firms around the world.

So basically the money you are paying is going to the pocket of totally irrelevant shareholders who have nothing to do with gaming other than maximizing their profit in any way they can, without any reverence or regard to you – the gamer -, gaming, modding or anyone else.

One would say that the sound business logic of making a product ever-lasting and ever-profitable with a pathetically low amount of investment as rewarding modders would make the executive bigwigs running about like crazy, but no – the logic in stock markets is that you maximize your short term profits as much as you can, doing whatever you can get away with, until someone stops you or you cant profit from that no more – at the cost of totally breaking whatever you were profiting from.

Just have a look at Wall Street if you want to know what kind of mentality is that.

So what Bethesda is doing is basically being dictated by these people who have nothing to do with gaming but everything to do with profit maximization at all costs – all the way through the chain of ownership from the private equity firm to Zenimax down to Bethesda. Even if the founders can claim some autonomy, it is in the end who holds the majority share who dictates what happens.

Bethesda couldn’t pull that off even if they wanted to. Not without great initiative and show of strength from their executives and founders.

But any company who actually retains their autonomy, can. Even Bethesda can, with some effort.

And this is what ALL of them should be doing

Just distribute some of the profits, even a tiny fraction to modding communities of your games. Even a tiny fraction would be enough in the wake of enormous profits the big studios are making.

Small studios can dish out comparably smaller amounts – the size of the gaming community would be tied to the success of any given game anyway. So if you have a huge modding community with spectacular mods, it means that your game is making profit – unless you are doing something very wrong.

Basically, this mindset of exploiting users (and their dogs, if possible) to make even more profit – something which plagues entire internet by the way – must end.

If the ones making the profit do not take the initiative to end it and rein the profit-maximization in, there are many different ways it can end.

Look at what happened to Microsoft. They had all kinds of plans on how to control and cash in on everything people were doing on their computers AND internet, at the start of 1990s. Open Source ‘happened’ to them and you see what state they are in today.

All it would take to totally upset the currently existing arrangement in between gamers and game studios is a good open source game engine and development/modding community taking off – something which would end up in people creating immense game world s and never ending story and content. There are a million ways to fund everything for such development, from open source projects to crowdsourcing.

A decent method is what is being used in Wordpress Theme & Plugin development – a system in which users pay for subscription (yearly) to updates for plugins, and in case they need, support for receiving direct support. Despite themes (yes, in actuality they are) and plugins are open source and therefore free, Wordpress has spurned a massive professional development industry around itself.

We are just in the phases before something like that happens – and the trigger for that could be the kind of shameless money-grab Bethesda & Valve attempted. Just like how Movable Type starting to charge caused mass exodus to Wordpress started the same kind of process for blogging software. But this is internet history, and a long topic.