Why did we sell Naughty Dog? It’s a question I’ve been asked countless times. The answer is simple: budgets were skyrocketing. When we started Naughty Dog in the 1980s, game development expenses were manageable. We bootstrapped everything, pouring profits from one game into the next. - Our early 80s games cost less than $50,000 each to make. - Rings of Power ('88-91), saw budgets rise to about $100,000, but yielded slightly more than that in after tax profits in 1992. - In 1993, we rolled that $100k from Rings into a self funded Way of the Warrior. - But Crash Bandicoot ('94-96) cost $1.6 million to make. - By the time we got to Jak and Daxter ('99-01), the budget busted the $15 million mark. By 2004, the cost of AAA games like Jak 3 had soared to $45-50 million -- and they have been rising ever since. But back in 2000, we were still self-funding every project, and the stress of financing these ballooning budgets independently was enormous. It wasn’t just us. This was (and still is) a systemic issue in the AAA space. Developers almost never have the resources to fund their own games, which gives publishers enormous leverage. Selling to Sony wasn’t just about securing a financial future for Naughty Dog. It was about giving the studio the resources to keep making the best games possible, without being crushed by the weight of skyrocketing costs and the paralyzing fear that one slip would ruin it all. Looking back, it was the right call. AAA games have only gotten more expensive since then. Today's big budget games can easily cost $300, $400, or even $500 million to develop. Would we have been able to keep up? Maybe. But selling -- to the right party -- gave Naughty Dog the stability it needed to thrive — and to continue making the kinds of games we’d always dreamed of!
Max Trest
2mo
Early arcade and console games are still exciting to play and they feature game mechanics that still hold up to this day. Small teams with small budgets can still make amazing games. With inflation, Crash Bandicoot cost $3 million to develop. Today, that game would probably cost $300+ million to develop and require a massive team. 100x the cost but would it really be 100x times as fun?
Chris Radley
2mo
As a person who co-founded one of the most creative studios ever to exist, that relied on the skill and talent of hundreds of artists I've the years, it's extremely disappointing that you used an AI generated image for your post. It honestly spits in the face of any artist you've ever worked with, and I urge you to think about this and do better in the future.
John H.
2mo
And now, the problem is, everyone should know from the past two years: AAA has an upper bound, and the market has not grown adequately to accommodate the required demand to justify the budgets of every game made. Important to know this, after the dust from GTA 6 shakes off.
Erik Kovac
2mo
Definitely the right call in hindsight. I connect with 100s of new devs studios worldwide each month and it’s constantly the same story… very few ever have a financial answer to “What is your goal”. Ultimately devs are creating games without the consideration to how much do these games need to earn to stay in business. Instead they design idea they feel are cool or compelling without any idea of market fit or trends. Not to mention unique selling factor to help the game stand out against the competition. Honestly, my work is tiring. Watching people blow huge chunks without understanding the risks. But few devs will grow to understand their own risks and wise up.
Jamey Scott
2mo
I'm glad I got to work in the game industry at the early stages, when self-funding a game with a small team was the standard. The friends that I made in those years have stayed.
Hmm.....it's disappointing to see the number of negative reactions to a post explaining how a studio moved to save livelihoods. In the current game dev climate, I can totally understand, and fully support, selling to Sony. Definitely the right call!
Gabriel Majorsky
2mo
But why the budget got higher each time? Would you mind to explain that as well please? thx
Rick Reynolds
2mo
Way of the Warrior brings back wonderful memories. I loved that game from the first build I saw of it (doing partner marketing at 3DO). You probably don't remember the launch party I advertised on Usenet and hosted at my home in San Francisco (I'm still friends with some of the folks that arrived for that.) And you probably don't remember the launch party kits I mailed to 6-8 households around the USA who requested one. But that aside, your main points are so true.
Indie Developer
2moI think part of the solution, after working at the Kennel for some time I realized, was to keep the studio at or below Dunbar's number: 150. I was thoroughly convinced after Uncharted 4, when an engineer dropped the controller and said "out of the 16 hours of gameplay, only about 12 was substantive, the rest was repetitive content we didn't need to have". It was from that comment I realized a 12 hour game with replay bonus would've been better and happen if we were forced to scale down to our previous size, below 170. One of the magical ingredients to Naughty Dog's success, besides everyone on the team being a ridiculous behemoth in a land of giants, was how everyone covered each other's backs. Making a video game is a team sport. One thing that was incredible at the Kennel was how anyone could've dropped the ball in FX, lighting, animation, gameplay, whatever ... and without saying a word, someone else was able to see the issue and fix before it ever came up. This was especially true on The Last of US. But once our team got too big, that magic died, because we could no longer sustain that phenomenon. People at that scale, couldn't remember what anyone else did. We forgot one critical part of great work: limits are our friend.