Publishers: Stay the Hell Away from Kickstarter

Here’s an anecdotal situation that struck fear into my heart.

Feargus Urquhart, founder and CEO of Obsidian Entertainment, said during a Q&A session on the Kickstarter campaign for Obsidian’s Project Eternity that the developer had been approached by publishers looking to do Kickstarter campaigns. Urquhart said those publishers, which he didn’t name, were looking to get Obsidian to lead a Kickstarter, raise some money, and then use that money to fund development on some unnamed game, with the publisher to then, well, publish the title.

Urquhart softened the situation slightly in his description, explaining that individuals within publishers come from different departments, those different departments have differing budgets, and those departments often have to compete with one another to get the funds necessary to make games. So Kickstarter could potentially present a way for an individual working at a publisher to do a project with Obsidian, or another developer; a project that might not get greenlit by the brass under other circumstances.

But as Urquhart explained, it wasn’t a winning deal for Obsidian, mostly because, he said, he didn’t think the folks at those publishers had considered the dev’s side of the deal.

“I said to them ‘So, you want us to do a Kickstarter for, using our name, we then get the Kickstarter money to make the game, you then publish the game, but we then don’t get to keep the brand we make and we only get a portion of the profits’ They said, ‘Yes’,” Urquhart wrote.

While I don’t doubt that Urquhart is right, and the individual people at different publishers aren’t bad folks, this does not bode well for Kickstarter. It indicates that the big money people in this industry are catching on to a sad but core truth about the crowdfunding service — there’s free money out there, and players are willing to give it.

Kickstarter is Not a Money-Grab

On some level it makes sense that publishers would be interested in seeing what they might be able to do with Kickstarter. Making games is expensive — that’s why publishers exist at all. They provide the money to make things happen, and when they do that, they take a big cut of the profits and control the property from there on. It can sound douchey for developers, and sometimes it is douchey. But by and large, publishers throw a whole helluva lot of money at game development and marketing; the system in which they get a financial benefit for playing that part makes sense.

Kickstarter can provide publishers, especially with many departments and a lot of overhead, the same promising outlook it gives to indie developers and even established ones who don’t have the money to invest in a project. There’s a micro-view of this situation in which an employee of a publisher sees Kickstarter as an opportunity to make a game happen that otherwise wouldn’t. Money saved on the development end means more could be spent on marketing, say. There’s a rosey perspective on the whole thing, to be sure.

But the result of publishers finding a way to exploit Kickstarter will be a money-grab, because for a publisher it’s like taking out a loan it doesn’t need to pay back. When you give Kickstarter funds to a developer, you’re exchanging your money for the work the developer will do. An exchange takes place. Kickstart a game for a publisher and there is no exchange; the money still goes to the developer, who exchanges work, but the publisher collects without giving. The developer bears the consequences of failure; the publisher collects money. And Kickstarter is not a well of free money, and should not be treated as such. The second that it is (and I think we’re already moving in that direction at a frightening clip), it loses all credibility and becomes a way to take advantage of players.

And the history of the way big companies do things suggests that you’d be deluding yourself to think they’ll be altruistic with such funds. There may even be good intentions behind this, but these companies exist to profit. If they can find a way to reduce costs, they increase profits — they don’t spend that money elsewhere just because it would be nice of them to do so.

The simple question is, if publishers have such great intentions, why aren’t they being up-front about their own Kickstarter campaigns in the first place? The simple answer: Because it would be akin to Bill Gates asking for money to sell you Internet Explorer. He wouldn’t be making Internet Explorer (an actual software developer would), and he’d be taking no risk in bringing it to market — he gets all the upside of selling something that could be popular. You’re paying him to give him a chance to make money off you.

Fleecing the Player

There’s a fundamental level at which the whole endeavor is dishonest, however, regardless of how it’s painted or how a publisher might see benefit in using Kickstarter. The reason Kickstarter exists at all is because publishers control money. Because they control money, they determine which creative endeavors are created and which are not. These decisions are made based on which creative endeavors are most likely to provide the publishers with a profit — because profiting is what publishers exist to do.

Kickstarter is not for publishers. In the case of video games, it exists as a way that developers can get around the corporate machinery or lack of resources that otherwise would kill their work. It’s for niche ideas and people who can’t otherwise make their ideas come to fruition. And it relies on a sense of need, of altruism, on the part of people who contribute funds. It requires trust — trust that the person asking for money truly needs it, and that he or she will use it as stated.

The publishers in question, in asking Obsidian to lead a Kickstarter campaign, are looking to parlay Obsidian’s fan-base and its trust in the developer into free money. They want to use the developer’s name, which has a lot of love and goodwill attached, and pair it with the underlying conceit of the Kickstarter service — that the money is needed or the project cannot be made. The fact that a publisher is attached makes that second part untrue: the publisher could fund the game if it wanted to, but it would rather not. There’s less risk and less cost involved; the publisher maximizes profit while minimizing risk and cost, which is its core function. In that scenario, the publisher collects money and ownership, bought with the developer’s good name and what amounts to a lie to players. And it gives nothing for these benefits.

Not only does the publisher not contribute, but it’s important that we note this again: it’s lying in this scenario. It’s taking advantage of players, developers, and the Kickstarter community in a terrible way. Bottom line: it’s a swindle.

The Death of Kickstarter

Right now, there’s already a great deal of mistrust with the Kickstarter service, even as it raises huge funds for creative endeavors. I’ve repeatedly heard prognostications of the service’s failure when a big endeavor finally falls through, when the money poured in by excited contributors evaporates, and everyone feels like they’ve been had by the person who created the project. Such a situation is not hard to imagine, and while Kickstarter has protections in place, it’s still a service that takes money from excited people who are gambling on something that might exist in the future.

So legitimacy for Kickstarter isn’t just important, it’s everything. Contributors need to know that when they give money, Kickstarter is holding up its end to make sure everything is on the up-and-up. If publishers are covertly setting up Kickstarter campaigns with developers who are pretending to need the funds, that legitimacy is utterly destroyed. How can you trust that a Kickstarter really isn’t just a moneygrab at that point? Any game developer could secretly be using their community, or even relative indie-ness, to draw in funds for a publisher. And the publisher, who provides nothing but funding, does not need more money. It’s akin to claiming you’re collecting donations for charity, without revealing that the charity is your own beer fund.

If there’s one entity in this whole situation that needs to step up, it’s Kickstarter. Tougher rules against people gaming the system — especially huge corporations with plenty of money — must be implemented and enforced. Loudly. Publically. With legal action. Otherwise, all the good that Kickstarter does and could do for creative people will be destroyed. Without trust, without legitimacy, Kickstarter can’t survive. We need to know that giving money to Kickstarter is not an open invitation to be fleeced.

Meanwhile, publishers: Stay the hell away from Kickstarter. What Urquhart describes is incredibly dishonest and unethical, and it’ll destory Kickstarter. It’ll likely send many people out of the gaming hobby completely. You don’t need to be this greedy.

Urquhart’s full comment thread has been compiled in the Obsidian forums by players. Read it right here.


Follow Hornshaw and Game Front on Twitter: @philhornshaw and @gamefrontcom.

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2 Comments on Publishers: Stay the Hell Away from Kickstarter

LTenhet

On September 25, 2012 at 3:52 pm

That’s just sickening, and it completely screws over anyone that even attempts to get behind a project like that, including the Dev if they were stupid enough to accept it. It’s basically saying “Hey do all the work, get all the money needed to make the game, but we’ll keep everything afterwards! It’s a GREAT deal developers! You get to lie to your loyal fans too!”

Aids

On September 26, 2012 at 1:40 am

No money no IS ever free. Lot like credit, one way or another someone is footing the bill. Developers would do better with a donate button through paypal.

Instead of begging for money put something out their that looks like it’s worth investing in. You have the resources and time someone can take notice if it looks like a serious investment. Not to mention if it interests the fans they will gladly pay for the product.