Game Development Costs

A very interesting study by Wanda Meloni at M2 details the cost of various forms of electronic games. They estimate $10 million for the average title on one console, with $18 to $28 million for multiple platforms. (What they don't say is that some titles have cost more than $50 million to develop; rumors are some have approached $100 million.) Note that those are just development costs; marketing costs (including costs associated with sales) can easily double or triple that number. Call of Duty: Modern Warfare spent over $120 million in marketing costs, from what I've heard.

Contrast that with the cost estimates for casual and social games ($30K to $300K) or mobile games ($5K to $20K). Yes, revenues are usually less... but then you have to look at Zynga, where they have raked in over $100 million in one year on the strength of a few social games that certainly didn't cost like console games to develop. ROI, anybody?


Of course, the downside for mobile and social games is that the marketing channels are not as mature, so unless you get lucky (and go viral) you have to put a lot of thought and effort into marketing just to make people aware of your title, much less spend money on it.