Larian Studios - Million Units Manual - on why games are expensive to make

Swen Wincke from Larian Studios has updated his blog with a post,
http://www.lar.net/2012/06/23/the-million-units-manual/
this time about some of the difficulties theyre trying to overcome when creating the rpg that will dwarf them all.
http://www.lar.net/2012/01/16/the-ro…warf-them-all/
PS: I apologize for the links shown as real link not as embbed within the text but for some reason, the link button doesn't work for me…
A quote then

If you have a 40 man team, and the employer cost is say 6K€, then one year of development will cost you 2,88M€. Given that most games take a few years to make, this means you rapidly end up with a need of over 5M€ to fund one game. That means that if you want to fund your own game with work for hire, and your game needs 40 people for 2 years at 6K€/month, you need to earn 5M€ before you can afford to spend 2 years on your own game. So, if you do work for hire for 2 years for somebody else with your 40 man team, you need to earn 10M€ to actually earn the freedom needed to develop your own thing. In the current market, that’s actually a tough proposition and rare are the jobs in the games industry where you are paid double the employee rate, so the reality is that you probable need to do even more work for hire.

More information.

Interesting, so a $20millions game budget is justified by sales being over 1 millions units.

Originally Posted by azarhal
Interesting, so a $20millions game budget is justified by sales being over 1 millions units.

If your independent and self publishing probably. Otherwise more gets taken out for the publisher and various other factors.

Originally Posted by azarhal
Interesting, so a $20millions game budget is justified by sales being over 1 millions units.

Going to be hard to sell more than 1 million units without a costly marketing campaign.

Fedex began as an idea presented in a term paper to which the professor graded it a D.

Originally Posted by aries100
Swen Wincke from Larian Studios has updated his blog with a post,
http://www.lar.net/2012/06/23/the-million-units-manual/
this time about some of the difficulties theyre trying to overcome when creating the rpg that will dwarf them all.
http://www.lar.net/2012/01/16/the-ro…warf-them-all/
PS: I apologize for the links shown as real link not as embbed within the text but for some reason, the link button doesn't work for me…
A quote then
More information.

well, 6k euro/month is a lot of money. I think only lead developers/project managers make that here in the US, and if the bulk development/art/qc is done in 'cheaper' countries it's probably more like 2k/month

This is the cost (salary+taxes+furnitures…) of the employee, not his salary.

Originally Posted by hisvin
This is the cost (salary+taxes+furnitures…) of the employee, not his salary.

Maybe with cheaper furniture? Or furniture which employee wouldn't take to his home after each game is completed, so it could be reused for next game?

In Belgium taxes and other costs for employers due to employees almost equal the employees' salaries. So someone who earns 3K/month would cost 6k/month for the company…