A video game publisher is a company that publishes video games that they have either developed internally or have had developed by a video game developer.
As with book publishers or publishers of DVD movies, video game publishers are responsible for their product's manufacturing and marketing, including market research and all aspects of advertising.
They usually finance the development, sometimes by paying a video game developer (the publisher calls this external development) and sometimes by paying an internal staff of developers called a studio. The large video game publishers also distribute the games they publish, while some smaller publishers instead hire distribution companies (or larger video game publishers) to distribute the games they publish.
Other functions usually performed by the publisher include deciding on and paying for any license that the game may utilize; paying for localization; layout, printing, and possibly the writing of the user manual; and the creation of graphic design elements such as the box design.
Large publishers may also attempt to boost efficiency across all internal and external development teams by providing services such as sound design and code packages for commonly needed functionality.
Because the publisher usually finances development, it usually tries to manage development risk with a staff of producers or project managers to monitor the progress of the developer, critique ongoing development, and assist as necessary. Most video games created by an external video game developer are paid for with periodic advances on royalties. These advances are paid when the developer reaches certain stages of development, called milestones.
As businesses go, video game publishing is associated with high risk:
- The Christmas selling season accounts for about half of the industry's yearly sales of video and computer games, leading to a concentrated glut of high-quality competition every year in every game category, all in the fourth quarter of the year.
- Product slippage is very common due to the uncertain schedules of software development. Most publishers have suffered a "false launch", in which the development staff assures the company that game development will be completed by a certain date, and a marketing launch is planned around that date, including advertising commitments, and then after all the advertising is paid for, the development staff announces that the game will "slip", and will actually be ready several months later than originally intended. When the game finally appears, the effects among consumers of the marketing launch—excitement and "buzz" over the release of the game and an intent to purchase— have dissipated, and lackluster interest leads to weak sales. An example of this is the PSP version of Spider-Man 3. These problems are compounded if the game is supposed to ship for the Christmas selling season, but actually slips into the subsequent year. Some developers (notably id and Epic) have alleviated this problem by simply saying that a given game will be released "when it's done", only announcing a definite date once the game is released to manufacturing.
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