Game development is the software development process by which a video
game is produced.[1] Games are developed as a creative outlet[2] and
to generate profit[3]. Development is normally funded by a publisher.
[4] Well-made games bring profit more readily.[5] However, it is
important to estimate game's financial requirements,[6] such as
development costs of individual features.[7] Often game projects
developed with "heart and soul" turn no profit.[8] Failing to provide
clear implications of game's expectations may result in exceeding
allocated budget.[6] In fact, the majority of commercial games do not
produce profit.[9][r 1] Developers, such as BioWare, Blizzard
Entertainment, Valve Corporation[citation needed] and id Software are
famous for releasing quality games on completion, rather than being
constrained by financial limitations.[10] However, most developers
cannot afford changing development schedule and require estimating
their capabilities with available resources before production.[8]

Game industry requires innovations, as publishers cannot profit from
constant release of sequels and imitations.[11] Every year new
independent development companies open and some manage to develop hit
titles. Similarly, many developers close down because they cannot find
a publishing contract or their production is not profitable.[12] It is
difficult to start a new company due to high initial investment
required.[13] Nevertheless, growth of casual and mobile game market
has allowed developers with smaller teams to enter the market. Once
the companies become financially stable, they may expand to develop
larger games.[12] Most developers start small and gradually expand
their business.[13] A developer receiving profit from a successful
title may store up a capital to expand and re-factor their company, as
well as tolerate more failed deadlines.[14]

An average development budget for a multiplatform game is US$18-28M,
with high-profile games often exceeding more than $40M.[r 2]

In the early era of home computers and video game consoles in the
early 1980s, a single programmer could handle almost all the tasks of
developing a game — programming, graphical design, sound effects, etc.
[15][16][r 3] It could take as little as six weeks to develop a game.
[16] However, the high user expectations and requirements[16] of
modern commercial games far exceed the capabilities of a single
developer and require the splitting of responsibilities.[17] A team of
over hundred of people can be employed full-time for a single project.
[r 3]

Game development, production, or design is a process that starts from
an idea or concept.[18][19][20][21] Often the idea is based on a
modification of an existing game concept.[18][22] The game idea may
fall within one or several genres.[23] Designers often experiment with
different combinations of genres.[23][24] Game designer usually
produces initial game proposal document, that contains the concept,
gameplay, feature list, setting and story, target audience,
requirements and schedule, staff and budget estimates.[25] Different
companies have different formal procedures[26] and philosophies[26]
[27] regarding game design and development. There is no standardized
development method; however commonalities exist.[27][28]

Game development is undertaken by a game developer—ranging from an
individual to a large company. There can be independent or publisher-
owned studios.[29] Independent developers rely on financial support
from a game publishers.[30] They usually have to develop a game from
concept to prototype without external funding. The formal game
proposal is then submitted to publishers, who may finance the game
development from several months to years. The publisher would retain
exclusive rights to distribute and market the game and would often own
the intellectual property for the game franchise.[29] Publisher's
company may also own the developer's company,[29][31] or it may have
internal development studio(s). Generally the publisher is the one who
owns the game's intellectual property.[r 1]

All but the smallest developer companies work on several titles at
once. This is necessary because of the time taken between shipping a
game and receiving royalty payments, which may be between 6 to 18
months. Small companies may structure contracts, ask for advances on
royalties, use shareware distribution, employ part-time workers and
use other methods to meet payroll demands.[32]

Console manufacturers, such as Microsoft, Nintendo, or Sony, have a
standard set of technical requirements that a game must confirm to in
order to be approved. Additionally, the game concept must be approved
by the manufacturer, who may refuse to approve certain titles.[33]

Most modern games take from one to three years to complete.[citation
needed] The length of development is influenced by a number of
factors, such as genre, scale, development platform and amount of
assets.[citation needed]

Some games can take much longer than the average time frame to
complete.[citation needed] A famous example of vaporware is 3D Realms'
Duke Nukem Forever, announced to be in production in April 1997 but is
yet to be released and currently planned for 2011.[r 4][r 5] Planning
for Maxis' game Spore began in late 1999 and was released nine years
later in September 2008.[citation needed]

The game revenue from retails is divided among the parties along the
distribution chain, such as — developer, publisher, retail,
manufacturer and console royalty. Many developers fail to profit from
this and go bankrupt.[32] Some developers seek alternative economic
models through Internet marketing and distribution channels to improve
returns.[34]

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