Outsourcing in Game Development

2GuyGames
2GuyGames
Jul 15, 2019 · 6 min read
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Hello again and welcome to another round of me trying to explain some of the thoughts we have on founding our company 2GuyGames. This time I want to talk a bit about outsourcing trends in the field of IT-industry, especially in game development.

For that, we have to look at already existing surveys and what those found out.

According to a study from 2008 (so from long ago) Outsourcing in game development is something important for game developers. Almost 80% of all game developers were used to outsourcing for at least some parts of their development processes. [1]

Unfortunately this is some very old data. Additionally we have to look at some newer data to validate the old data and detect possible changes from the old survey. For that let us first look at the growth numbers of the spending on IT-services as a whole.

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Information Technology (IT) services spending forecast worldwide from 2008 to 2020

The above graphic shows that the spendings have risen over the past years with some fluctuations. Also it is expected, that the expenses for IT services will grow in the near future.

Now we should look at the outsourcing expenses of the outsourcing part of the IT-industry. We can see here that the market of the outsourcing services fluctuated over the last years. The market still does not significantly growths nor shrinks.

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Fig. 1: Global outsourcing industry revenue from 2010 to 2018, by service type

But can this give us reliable data or the possibility to claim how the market will develop in the future? Not exactly, because the revenues are fluctuating quite a bit.

For that let us look at how much software development and maintenance is contained in the whole global outsourcing industry revenue. [2]

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Outsourced or off-shored IT funktions worldwide, as of 2017

As showed the development and maintenance of software are the most commonly used types of outsourcing in the IT-Industry. [3] [4]

What informations does this gives us now? Well, we can assume, that software-development and maintenance are the most commonly outsourced parts of the IT-industry. Plus, the outsourcing expenses fluctuate quite a lot. That leads us to the assumption, that the software parts of the IT Industry are quite popular and play perhaps an bigger part in those fluctuations.

So far, so good. But what about the gaming industry? Unfortunately, there are no studies that show us exactly what kind of, and how much outsourcing is present in this part of the industry. To get answers on this case you have to search for articles and ask game- and outsourcing-developers directly, to further refine your dataset and to get some insights to the present usage of outsourcing. We did this with four simple questions for each kind of developer.

These are the questions we asked companies which provide services:

  1. How often are companies coming to you making use of your skills as an outsourcing developer?
  2. Are you rather developing certain modules, stages or components or whole game concepts?
  3. How would you evaluate your work regarding performance and costs? More beneficial or not and why?
  4. Do you expect the market for game-development-outsourcing to grow in the future and why?

These are the questions we asked companies looking to outsource work:

  1. How often are you making use of outsourcing developers (e.g. Freelancers) and outsourcing companies?
  2. Are you rather like to see certain modules, stages or components developed or do you outsource whole game concepts?
  3. How would you evaluate this kind of work regarding performance and costs? More beneficial or not and why? Are there any problems like communication or quality?
  4. Do you expect the market for game-development-outsourcing to grow in the future and why?

Some of the answers were quite often the same for both parts. For example on how often game developers hire outsourcing developers the answer was quite clear. Most game developers make use of outsourcing developers and vice versa outsourcing gets many orders.

In terms of the kind of developments that were outsourced in the second questions was a bit more diverse. Some game developers are willing to use outsourcing for every part of game development. 3D or 2D Assets, Music, programming and even story writing. The outsourcing developer on the other side are often more specialised in one or two different things like 2D Assets and Music or 3D Assets and programming and so on. Furthermore many outsourcing developers tend to have few connections to companies but are closely linked to them and their work. That means they often prefer long-term relationships over many different clients.

In terms of question three the outsourcing developers evaluate their work as something that is very beneficial in terms of costs and quality for them. That goes as well with most of the game developers. They see the cooperation also as something that is more beneficial for both of them. They see only the exception in terms of coordination of work. This is the most crucial interface for the cooperation. Only if you communicate what you want in as much detail as possible and control the work almost every day you can be sure that the work is done correctly. Only then you can be sure that you get what you want and still save time and money by doing so.

This leads us to the answers to the last question on how all of them see the market in the future. All participants, even if they do not make use of outsourcing or had not the best experiences see the outsourcing-market as something that is already very well established but will still grow much in the future. I think this because of the following reasons. Game developers and the whole industry has to become even more flexible in the future. Allocating costs will be one of the most important topics that will never go away. Time is also one of the most crucial parts of game development. For example for “Horizon Zero Dawn”, 64 3D-Asset Developers were busy for two years “only” by developing ⅓ of the enemies in the game and creating settlements. [5] This addresses all three requirements at once. This kind of Work needs to be done flexible, as well as cost- and time-efficient.

Now can we finally answer the question on the future development of the outsourcing-market? Yes, to some degree. The reliable data shows that the expenses for the outsourcing industry fluctuate a bit. But newer literature and surveys show that the old data, that almost 90% of all game developers will source parts of their development processes out in the future is either not achieved or not enough. Outsourcing is therefore an ever-growing market that will be persistent for the foreseeable future. That leads us to the simple conclusion, that it is not the worst idea to found a company that focuses its work on outsourcing services.

Okay I hope you enjoyed our thoughts and conclusions on this case. Next time Marco will talk a bit about where we are currently standing with our startup process. We change the frequency of our blog to once a month because we do not have the time for an two week blog at the moment. Till next time and have a nice day.

Stefan

[1] Gamasutra Sudy: https://www.gamasutra.com/view/news/113952/Survey_Outsourcing_In_Game_Industry_Still_On_Increase.php

[2] Statista: https://www.statista.com/statistics/203291/global-it-services-spending-forecast/

[3] Statista: https://www.statista.com/statistics/189800/global-outsourcing-industry-revenue-by-service-type/

[4] Statista: https://www.statista.com/statistics/662991/worldwide-cio-survey-outsourced-it-functions/

[5] Horizon Article: https://theoutline.com/post/3087/outsourcing-blockbuster-video-games-made-in-china-horizon-zero-dawn?zd=2&zi=uwhwkik6

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