How to Fix AAA Game Dev

Read Time: 7 Minutes

I’m going to tell you one major way I think AAA studios could make strides away from the maw they find themselves teetering over (spoiler: Stop thinking high “Production Quality” equals amazing player value). But first, I want to give some CONTEXT! I’m a game producer after all.

Games Are Expensive To Make

The costs of game development have gone up dramatically in the last 15 years. When I go look at titles like God of War 3, Assassin’s Creed 2, Resident Evil 5, Shogun 2: Total War, Bioshock, Borderlands, and the list could go on, it is rare to see numbers over $50m.

Many of those titles were in the dozens of millions for dev cost, somewhere between $20-$40m. 

Compare that to today, where not a few startups have raised that much OR MORE in their early (Series A) rounds of funding. For the big studios, a modern AAA game is expected to have a budget in the hundreds of millions, with the biggest titles potentially cresting past $500m or even in the billions!

Acknowledging that marketing is often a huge part of these budgets and isn’t always included in estimates, there has still been a giant increase in how much we spend to make AAA games. The teams building them have higher salaries than they used to, the teams are bigger than they were, and the time to go from ideation to ship has increased. 

The cost of premium games has gone from $60 to $70 in those same 15 years. We’re relying on more purchases and other ways of monetizing to make up the difference.

And while revenue in the AAA gaming space has gone up, it has not risen at the “5-10x” rate of budgets in that same time period to deal with the compounding challenges of more people, being paid more, working for longer.

But revenue has gone up enough for everyone to talk about the large increase in sales and (assumed) profits in our industry. Questions get asked like, “In a world of record gaming revenue, why does it seem like the game industry is struggling?”

Fair question, but it has some good answers, and that without even discussing power law curves. Game dev costs outpacing that increasing revenue are just one of them.

Another is that much of the revenue going towards games is landing with existing live service products that have been around for awhile like Fortnite, Warframe, Counterstrike, and so on, while the next biggest chunk is spent on sequels like the EA Sports franchises and Call of Duty.

Supporting this trend, If you look back at the last decade or so, the “best selling game of the year” is mostly Call of Duty plus a couple of Rockstar games, and the exception of Hogwart’s Legacy (not exactly an unknown IP) in 2023.

Today though, even the sequels are starting to struggle. Rising dev costs means that a mediocre release of a sequel doesn’t mean a studio covers costs like it used to. It means it loses money. If a studio loses money long enough, it goes out of business.

Last thing I’ll mention: a massive part of the rise in total gaming revenue relates to mostly F2P mobile gaming via in-app purchases and ads. Very few AAA studios are seriously playing in the mobile space, sticking to what they have historically been good at.

The result of all this? Despite our record gaming revenues, the studios actually making the AAA games are often not seeing that revenue turn into meaningful profits. We can argue about how money is being mismanaged or how C-level people are being greedy, and both of those things are happening (because they always are), but there are underlying problems that are worse today than they were 15 years ago for a AAA studio making new games. That’s an important thing to realize.

The Expectations of AAA

Based on that context, the underlying crucial question is how do I reduce the cost to develop a game, so the rising gaming revenue I’m receiving more than covers my costs.

And here, we get into how expectations are skewing dev costs up.

When someone says, “AAA game,” that means something to them. It’s likely not just about having a particular budget or reputation. “AAA” implies high quality, lots of polish, large scope, and great feel. These aren’t rough indie titles that might be fun but are obviously “low quality,” these are the big fish in the big pond, putting their stamp on what it means to make the best possible games a group of humans can make.

I’ve never met a studio that didn’t claim they’d hired and retained the best possible talent in the industry, but man is that true for AAA studios. Just being there means you must be one of the best, or you’d never have made it. There’s a strong belief that that’s one of the big deltas, and that the people who can do the best work across every discipline work in AAA. 

Between the expectations and the people, AAA studios are understandably incredibly focused on creating the highest production quality in gaming. And by production quality, I’m talking visual fidelity, UI design, audio, realism, and more. They are supposed to push the bar of just how amazing games can look and how polished they can feel.

To make the challenge more difficult, players have come to expect this of certain companies. If you hang around the gaming community at all, you’ve probably seen something like a comparison between the visual quality of a game like the 10 year old AC4: Black Flag and the recent Skull and Bones. Players will lambast the loss of quality of water effects or something else.

That Skull and Bones and AC$: Black Flag were fundamentally different games with different characters, camera, and many other things get lost. And what else is lost: if Skull and Bones was as much fun as Black Flag was for players, far fewer of them would care about these kinds of complaints. Skull and Bones didn’t struggle because it had less refined water effects than other games. It struggled because players didn’t find it engaging.

But we (and players) can trick ourselves into thinking that the problem was just a bit of visual polish. Even if we intellectually know that’s not going to move the needle, we still gravitate towards it as some sort of solution to the problem of the modern AAA game.

Why? Because when we don’t know what to do, activating our insane expertise at creating high production quality assets is at least something we have control over. If I’m an artist, or art heavy team, maybe I can’t solve the underlying gameplay problems and the lack of stickiness my product has. But gosh darnit I can make some great art such that people will never be able to say the game failed because of bad art.

I’m oversimplifying this, I’ll admit it. But I do believe our obsession with production quality leads to many game experiences that end up less than the sum of their parts. Contrasting this, the mark of great games is that they end up more than the sum of their parts.

AAA games with big teams can easily fall into the trap of sub-optimization. Art is taking care of art, engineering of engineering, design of design. The whole experience slowly becomes secondary to the individual craft expression. Sorry to pick on one studio, as they are not alone in this, but Blizzard has not produced a game with low production quality since I’ve been playing games. They have produced games people didn’t find that engaging.

We’re Getting Lost

AAA is falling into a trap of thinking that making more good stuff will naturally lead to a better game. And by the way, I don’t think you can make a compelling argument for high production quality HURTING a game (though the ARMA II DayZ mod might dispute that…). But too many people act as if high production quality is what makes a great player experience, when the counter-examples to that are numerous.

Having high production quality does NOT mean you’re adding a lot of player value. Always pushing for higher quality doesn’t equate to being player focused. And in many cases, you end up with a lot of high quality work in a game that isn’t that great.

If AAA studios want to lower their costs, they have to step back a second from their obsession with production quality at all costs, and engage with a philosophy that is about creating the best possible player experience at all costs, followed by quality sometime after.

Even better, they need to realize what types of quality are going to move the needle the most, and focus there, and be ok with other things being lower quality because they don’t matter as much. 

I have seen too many large teams or studios stacked with amazing people all spinning their wheels, working hard every day while fundamental issues about how they work together, or what game they are even trying to make go entirely unanswered. Everyone is busy with their own tree and no one is taking care of the forest. Disciplines become almost defensive and adversarial towards each other, as each attempts to make sure they get the time and resources they need to do the absolute best job anyone could ever do.

The team size expands as all disciplines need more people to meet these insane expectations, and everyone burrows deeper into their own craft. The leaders and producers that should be taking care of the big picture end up lost in their plans and budgets, sub-optimizing Favro or JIRA as if that’ll be the difference maker.

The irony is that when you go into these teams and ask about the problems, there are people who can tell you what they are. But they either don’t think it’s their job or have been punished in the past for bringing those problems up. Rather than solve those problems, everyone focuses in on their own silo of stuff to do, hoping someone else will solve the fact that players don’t seem to like what’s being made.

Large organizations are more prone to this, because it’s easier to think all those issues are someone else’s job to solve. And there is no doubt that everyone - even if they are doing something that really doesn’t move the needle at all - is busy all the time.

You end up with a large organization of busy people not solving the most important problems while absolutely burning money. It’s a dysfunctional bureaucracy. Some people - some devs! - think that’s what AAA game dev is. 

Escaping The Trap

We have to refocus our orgs to share goals and be rewarded not based on individual expression of craft, but collective delivery of compelling player experiences. 

To do that, you need to create the vision of the game and then have everyone beat it up, improve it, and understand their part in it. You need to recognize where you want to invest time and how you’ll work through the biggest risks and unknowns related to the game, then focus on resolving those issues before hiring dozens or hundreds more people to go “make amazing stuff.” 

You need your organization to accept that production quality does not directly correlate to value for players. At best, it creates indirect value. At worst, it’s self-deception, tricking you with amazing art or smooth framerates or humorous dialogue.

Another big piece of this is the ability of everyone to work together and tackle the shared problems. If your disciplines don’t interact well together, even if they are all individually amazing, you are unlikely to create something stellar. When you see breakdowns in relationships between disciplines, that needs to be a high priority to solve for leadership. No single discipline can create a AAA product.

This is hard. It takes everyone and especially all your leaders into an abstract space that’s less controllable, less measurable, and less sure of being able to “show results.” Our comfort zone is what we’re best at. “Breaking ranks” to go and talk to other disciplines about how we can help them because the collective problem we’re all having is more important than the individual problem you are having is counter-intuitive and uncomfortable.

If you can create this culture within a studio, I believe you’ll dramatically lower costs. 

How so?

By staying tightly focused on the major pain points of the game as a holistic experience, you’ll hire fewer people, and you’ll hire them later in development. 

By having people in tune with the vision of the game, you’ll get more discussion and conflict about what really matters to achieving that vision, reducing the number of things built that don’t actually move the needle but do suck up lots of resources.

By collaborating effectively and understanding more than your own discipline space, novel solutions and ways to support each other will emerge that end up replacing the need to hire.

And, to top it all off, you’ll have a better understanding throughout development of the viability (or lack thereof) of your product.

The best part? If you build fewer things that matter more, you have less stuff to polish. Your game can still come out at high production quality. It just won’t have all the extra stuff that wasn’t adding much value. There may be a lot fewer high quality things that never see the light of day, replaced by rough tests that taught you what you needed to know and are much cheaper to discard.

I realize this is asking a lot. It’s a serious pivot for AAA game dev. But I do think a shift away from the “product quality” obsession and a return to creating compelling player experiences (experiences that are probably why you ended up becoming a AAA studio in the first place) is going to increase your chance of making great games while also lowering costs. And that means more ROI. 

Not an easy shift. But I don’t know that we have much choice. The underlying economics require a major change. So best get to it!

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