SG&VGF 2013: Work for hire is broken, argues Mediatonic CEO Dave Bailey
In a Social Games & Virtual Goods Forum session describing the company's quest to become the world-leader in the games-as-a-service model, Bailey described the current crop of work for hire deals as "broken."
What usually happens, he explained, is that a publisher funds a developer to deliver a product based on an agreed specification.
The problem with this structure is that it makes it impossible for a developer to react to a changing market, and incentivises short-term thinking.
Indeed, these deals compel developers to complete projects quickly, and to forget about the project once it's concluded. After all, the developer will have little to no financial interest in the game's success at this stage.
Instead, Bailey advocated revenue-sharing and co-funding deals, ideally in a 50:50 arrangement between developer and publisher.
These make sense for both parties, he argued, as they incentivise the long-term thinking that the games-as-a-service model demands.
They make both publisher and developer an interested party in the game's long-term success, and they also allow either company to walk away if the project isn't taking shape as expected.
And, perhaps more importantly, these deals are simply more sustainable for developers rewarding creative excellence with long-term financial benefit.