God of War III Cost $44 Million to Make - News

I'd have to say that videogirl's analysis makes the most logical sense.

Another thing to consider is that when budgets are announced, especially for movies, they are over-exaggerated. Why you may ask? To make the movie seem larger than it is. Sometimes they add the cost of everything involving the movie, like marketing, into the budget. Sometimes it's just a made up number. Steven Sommers said this when speaking about the budget of the Mummy movies on a commentary. I believe it was either one of the Mummy movies or Van Helsing.

The Lord of the Rings trilogy was all filmed at the same time, with an estimated budget of ~$175 mil. Now, given that figure for 3 movies (including having to fly the cast back for reshoots), how could King Kong, just one 3 hr movie, cost the reported $250 mil. I also highly doubt that Avatar cost the reported $400-500 mil. Just something to keep in mind when you hear someone talk about budgets.

as jim cameroon said..these expenses are very much justified in the hope that u recover the cost, then make some profit and and make some more...Avatar only domestic gross till date..$720mn

This thread is hilarious. So many people just quoting numbers as irrefutable facts.

Reminds me of a sketch in a recent show.

A poll in America asked if the invasion of Iraq was justified. The results

60 Percent said YES
37 Percent said NO
3 percent said I DONT KNOW

Does this tell us that the Iraq invasion is justified ? NO

It tells us that 97 percent of Americans are so deluded as to their own importance and ability, they feel able to express a clear opinion on something which for the most part they are ignorant of.

quality game will always be quality game, GoW3 will be epic.

20-25$ it's waaay to small amount you coun't.
Game publishers have around 32$/32euros(43$) from each copy.Retailers have really small provisions from selling game(less than 10$) and other costs are really small.And Sony have even more from each copy beacause they don't pay provisions to console manufacture from each copy sold.so they have around 37$/37euros(49$).So they need only 1mln copies to return the costs.Believe me i can tell you this because i work for a local publisher in central Europe.

Videogirl : nope.

Marketing cost includes both "general cost" for general campains (which impact with a prorata on each game), and specific cost for a specific game... which impact the game cost itself of course

...

Let's asume 20-25$ per copy, meaning it s way too expensive... but they can re-use it for GoW 4

@Videogirl Don't forget to include the creation and shipping of the physical product.

It doesn't matter as Sony will make the money back off this game easily. However it does show the risk in developing top to medium tier games for the HD systems particularly the PS3. The average medium-high tier game to develop for the Wii is $5 million(The Conduit, Punch Out, Wario Land:SI, Dead Space:Extraction, MoH:Heroes ) with their top tier being held at less than $10 million (Mario Galaxy, MH:Tri, LoZ:TP etc). This makes sense for the Wii as it is essentially using previous gen techniques that many companies have learned to reduce cost and budget. The X360 looks like the average cost for a medium tier is $12-14 million and the PS3 is looking at $15-20 million to develop an average game. It does show and prove that if you want to use cutting edge tech you have to pay for it; and explains Nintendo's hesitation to move into Wii-HD territory!

some of many numerous sources:
http://www.neoseeker.com/news/6299-wii-development-costs-remain-low/

http://www.joystiq.com/2009/02/04/more-wii-games-from-ea-thanks-to-low-development-costs/

Some here fail to use logic : Sony makes at least 32$ out of each copy sold because they are the games developer and publisher. But that’s for US only.

In Europe they make an average of 32€ if not more per copy sold and that’s about 45$.

As for advertising costs, may I remind you that a company has a marketing department which has a global budget dedicated to general advertising costs, and this budget is covered by the overall profits made by the division (which does not only includes games but also profits on add-ons, by-products, micro-transactions, etc.). That's why including any amount for marketing costs is irrelevant to the point.

So to be able to recoup the 44 million this game costs, and assuming that sales will be split 50/50 between the US and Europe. Sony only needs to sell around 1.2 million copies of the game.

If this is just the development budget, its massive - one of the most expensive games ever. $50m AU - a mind blowing figure IMO, for a "game" dev.

Sony would make around $25-$30 per unit, depending on retailers, shipping, deals, shelf price and so on. Still needs a solid 2m units shipped to break even (which is should do).

Nybbas : retailers and sub retailers (and most of them sell games for 40€ meaning they still have margin, shipping cost, marketing and advertising, taxes, box and boxing, manufacturing etc etc.

It only takes basic knowledge to understand a publisher get around 27$ minus marketing and other expenses (you know, when u run a business : pens, paper, water...)

We also have to know how much for marketing and also tax per game sold.

@mokn

the devs get $25 per game and the publishers get $7

This game will generate less profit than Just Dance.

Guys seriously, don't worry..

1.6 million units are sold, than it has paid itself off.

2 million units are sold, they paid off running their branch for another year (or more).

If they sell 3+ million units, which they most likely will, they made a huge return on the game. 90 million after all the money is divided, and 46 million of it would be a profit. Than they can make another GOW game that takes years upon years to develop without worries about funds.

@mokn:

Your numbers are way off buddy, don't feed people false things. Percentages vary, and as well as the royalties that the developer pays to the publisher and so forth. This number is significantly less, since GOW3 is a property of Sony Entertainment (North American studio). Games sell for about 45 bucks to a retailer, where about 25% of that goes to royalties of companies in association to the game. It roughly leaves about 30 bucks, give or take to the developer company which is actually Sony INC, Santa Monica branch.

Games sell for a percentage of a games retail marker which is about 45, not what you see in retail (60). These are fixed percentages that stay in play, no matter if the game costs 10 bucks, or 60 bucks. They don't use actual money to decide what royalties they will give out, it's by contracts and done by percentages.

Sounds significantly less than many Movie productions. Consider movies like King Kong, Pirates of the Caribbean: At Worlds End, Avatar and Spider Man 3, all which cost over 200 Million in production costs.

Of course, you also need to factor in what the marketing budget for God of War III is going to be. And if they spend another 75-100 million on marketing, it can easily get up there into the 'disgusting' level. And before you say they won't or Sony would never throw their money away like that, take a look at the development for the Spider Man movies....

at least it will make its money back.

and the other 30?

The games usually make $20 each of which $10 goes to the publisher in which they give however much they agreed on to the developer, the other $10 goes to sony because it's their system, if the game was sold on xbox 360 it would be $10 to microsoft.
These were the numbers of games sold at $50.

Yeah it will break the sales with no problem.

how could you think they only make 10-15 dollars a game? where is that other 45 dollars going to? Maybe the people posting here know something I don't, if you do, enlighten us with a breakdown of who the 60 dollars is spread around to.

Wow, seems risky to me to invest so much but on average the games have sold 2.5 million i think. But that cost is ridiculous and seems bloated... the game looks epic visually but the gameplay looks quite old hat... hopefully i'm wrong because i love another action game to come out since i've already murdered bayonetta...

It looks the part, a great title for fans of the series.

If it costes 44 Million / 40 = 1´100.000 copies needed to be sold in order to break even.

I really think its sales are going to be close to 4 million.

I wont get 44M worth of enjoyment out of this, but close!

"Dno says:
how do they only make 24 bucks a game.. i know for a fact they sell the games to gamespot for 48 bucks. where does the rest of it go? lol"

Gamespot sells games?

SONY gets at least $40 per copy of the game sold, while the price is $60 -- as they receive the console manufacturing licensing royalty AND the publisher sales money.

This Is Spartaaaaaaaaaaaaaa

they should have no problem getting all that money back and then some.... plus I am pretty sure they will drop some DLC later on as well.

I dont see them making more than 10-15 $ a game

meaning it has to sell A LOt

they'd need to sell atleast 2 or 3 mil to make this worthwhile? seems a bit mad

Even more confirmation that the game is EPIC!

I'm sure every game on the Wii cost $100,000 to make & thats being generous LOL

This game will be sexy

I don't see it having any problem turning a profit.

how do they only make 24 bucks a game.. i know for a fact they sell the games to gamespot for 48 bucks. where does the rest of it go? lol

@Hyruken:

I stated earlier, depending how much goes to the developer. A company makes between 25-33 bucks, from the original 60. You can be looking at about 1.6 to 2.0 million units sold to make back the production costs. This also includes the advertising which is about 10-15% of the development costs. When they make about 50 million bucks, they will have made profit.

Worst case scenario, they only make 25 bucks per copy. They would need to sell 2 million units exactly to make 50 million. And we all know, GOW3 will sell 3+ million units (it's probably going to be Uncharted 2 territory). Best case scenario, they make 33 bucks per game sold. They would need to clear about 1.52 million units, which isn't that much for this kind of franchise. Still I think this game will clear out 3 million units before a price cut on the game (2 million in first 2-3 months), and 4+ million units cleared life-time. What I hope for is that they can exceed expectations and clear the high end and enter in the hugely successful titles with 5+ million units cleared.

Also, you need to remember, Sony does some of the advertising themselves, which is separate from actual developer costs. Companies like Sony and Microsoft have yearly cash they send on games advertisement. You have prolly noticed the FF13 campaign paid by Microsoft, hence why it doesn't show PS3 anywhere. Square saves money here, just like GOW3 does because of Sony's advertisement budget.

They should make that up easily! I predict this game could sell 3-4 million units.

It's not clear whether this $44 million includes marketing or not, I'd imagine it does but if not that's another $15 million + on top of that. I'd assume marketing would be in the total budget though.

Either way, Sony are making about $30 per copy, so 1.5 million copies at full price is break even point. They'll make that easily...

So how many units does that mean it needs to sell you think to break even? The game looks good and should sell well but 44m is a lot of cash. Contrary to the report that most likely does put it in the bracket of high spending games, wasen't Halo 3 50m to make?

@Chrizum
I have heard before (from Capcom) that a game's advertising is usually 10% of its dev budget, unless it is a really important title (like GOW would be) and it goes a little higher. You would probably be right in saying it would be about 25% in this case.

I never would've imagined this game would cost that much. I would've assumed $20m-$30m. God of War games are usually like 7-11 hours too so I'd figure this one would be just as long. Wow

They'll get $30 for each copy sold in America. So 1.5 million copies in America will get them to break even. I reckon it'll do 2.5 million in America with another 2-2.5 from the rest of the world. Comfortable profit there.

this gen NEEDS to last for a very long time. these numbers need to come down.

I bet GOW collection was released so they would need to sell less to profit.

I don't think it's that important to Sony to break even with this game. We have to consider the halo effect this type of exclusives provide to the console. I don't think this game is going to sell the crapload of units some people consider it could sell, but it's going to provide more than only pure profit. Good games make people buy consoles, more consoles sold make people buy more games. It's a virtuous circle, Sony needs good exclusives to get into it.

is the same money of killzone 2 imo.

@chrizurm, but this is God of War, it is not a risk to spend this money, and most games will not cost this much. From looking at this, you can tell that it was a worth investment and that the money has been spent

money well spent

ye sure it did cost 44 big ones but that was to develop this amazing engine. santa monica sony dont have to start from scratch now, their next game wont be as expensive to make and thats where the real profit is made. naughty dog did the same thing with uncharted 2 and guerilla are going to do the same thing with killzone 3.

Wow! This Is Vegas is rumored to cost $40-$50 million and may never see the light of day... At least this title will have a chance to making a profit or breaking even.

@zibeddy: That's how most great selling games are. I'd say the best non-bundled game sales compared to console sales would most likely go to Halo, as it single-handedly put the Xbox on the map.

But anyway, some of the best selling games of all time, when compared to their respective system sales, range from 15-33% of all the owners of that system. selling to 10% of the audience is a very good thing.

Well if they sell 2 million units, that's 120 Million bucks. They will break even, you have to be aware only about half goes to production costs. The game will sell more than 3 million life-time with rather ease (just like Uncharted 2), which makes a nice profit to GOW3's developers. Though, it's crazy how some games have to sell 2 million units (give or take) to break even in production costs. But also awesome how much effort some developers give to enrich us with an experience like GOW3, Final Fantasy 13, Metal Gear 4, Gran Turismo 5, Mass Effect 2, and few others..

This is without the advertizing costs. I have read that advertizing can be approximately 25% of the developing budget, that would mean €55 million for the entire game. Publisher gets ~€24 for the game, so that means the game needs to sell 2.3 million to break even.

This is insane. No wonder developers and publishers are filing bankruptcy left and right.

Well they are going to get 1m week one, so going quite a long way to making up that money.

It is a little pricey, especially given Uncharted 2 cost $20m, but they will still make the money back

Geez, these games are getting insane.

@zibeddy How do you figure that only 10% of PS3 owners are interesting games? GoW3 isn't the only and not buying God of War 3 doesn't mean you're not by any games at all. Hyper-gory beat-em ups don't appeal to everybody with a PS3.

Well if you want to make a massive game like GoW3, you have to open your wallets, plus, the game is a system pusher, so more people will jump to buy a PS3, and thus more software will be sold in the longrun ;-) I doubt that they will have any issues to make a nice profit ;-)

@ ioi...in this case,Sony would get a little more, since it's first party, and they are getting both publisher and developer's take...unless they have a IW case on their hands...lol.

its going to sell over 1 million copies plus for sure and thats going to be in the 1st week but they should be looking for 3 million worldwide eventually. its just perplexing that there are 30 million people with ps3's but only 10% are interested in buying games for it.

Hmmm...alot of people when ballistic over MW2's $40 million dollar production cost, so it's interesting to see the comparison on production cost to profit ratio. The game will make the money back, no question about it...jsut looking at the previous games, a number of 2-3 million units is a lock at worst.

Wii Sports? lol It looks like maybe $2000.00..... Tops $3000.00 lol

they'll make their money back in 1 week

of course this game will profit.
plus you know there is going to DLC for it.
god of war is an easy investment for Sony.

1 million copies at 60 dollars a piece. thats already 60 milion. i doubt distribution and costs come even close to 15 milion. Thats a profit on the first million, not counting special editions. then it will probably sell 4-6 million copies total. 1/4 billion dollar profit for a 44 million dollar investment

Easily make all that up and more

Profit on this game should be easy.

Thats not alot.

How much did Wii Sports cost for its success though?