Against the Gods

Against the Gods
Cold Equations: The Death of a Game Company

Bruce Nielson | 25 Jul 2006 12:02
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(Author's note: The story you're about to read is real; only the names have been changed.)

I stared the Cold Equations in the eye and survived, though I was not unscarred. Yet the true hero in this story was a man named Jim.

When I started working for Erudite Software Consulting in 1994, I was excited about finally getting out of school and into the software industry. Though primarily a software consulting company, Erudite also sported a games division, which was working on a game based on the board game The Great Battles of Alexander.

Three years passed before Alexander finally saw the light of day. It was a complex, historically accurate, turn-based strategy game made during the time of the RTS. Despite this, the only truly negative review I read about it was in USA Today, which said that its - obviously casual - players couldn't figure out the game. But magazine critics, who were hardcore gamers, raved about Alexander! At last their favorite niche was being filled.

Then, one of Erudite's owners, Jim, approached me about managing the game division on their follow-up titles. I was nervous about this, because the game division wasn't popular with the other company owners. But seeing an opportunity to help turn the division around, I eventually decided to help out part time. Besides, how hard could game development be?

How hard indeed!

Although managing artists was a new experience, it turned out to be pretty much like managing programmers. But there was one huge difference between the two groups: The game programmers made between $30,000 and $50,000 per year, whereas the artists were lucky to break $19,000. So, why would highly skilled, highly trained, college-educated artists make less than equally skilled and trained programmers? When I asked Jim, he responded, "It's the price the market will bear." This was my first brush with the Cold Equations of economics.

Though not well paid, the artists were still passionate. Making money as an artist is, for them, like jocks making money playing sports. Unfortunately, artists "over supply" the market compared to its demand, which means lower salaries.

Soon, I realized the game programmers were underpaid, as well. By far the most technically adept programmers in the company, these game programmers made 30 to 50 percent less than equivalently skilled software consultants - not counting overtime! I supposed this was the price you paid to make games for a living. Like Jim, the programmers and artists had real passion for what they did. Making money at making games allowed them to do what they enjoyed and still pay the bills.

The effects of supply and demand on game division salaries reminded me of Tom Godwin's classic story, "Cold Equations." A spaceship captain was to deliver time-sensitive vaccines to the dying inhabitants of a far-off planet. According to physics laws, the ship's mass and fuel must be carefully calculated to insure an exact arrival time. But after discovering a stowaway, and realizing her added mass will endanger the mission, he sacrifices her life to save millions of others. Little did I know that supply and demand would soon create my own "Cold Equation." I found myself confronting immutable economic laws that coldly took their victims, regardless of the best human intentions.

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