Kongregate: a potentially disruptive indie game publisher

Jan-25-07, 3:20 pm by Hanford
File under: Video games, Macromedia, Director, Adobe, Shockwave, Lingo

I guess I didn't really "get it" when I first checked out the new game site Kongregate. I kind of saw it as a YouTube for games. But even though I'm an indie game developer, I didn't see what really is important about their site. So I'm going to discuss it. I'm loving their point-driven system, which is not unlike the Xbox points that I talked about earlier. but the the real important thing Kongregate is doing is on the developer side.

Developer Friendly Game Publisher

Taking a closer look at Kongregate, I realized that it has potential to be a very disruptive game publisher, following practices that I had wished other publishers would do for a while now. And when I say "game publisher", I mean indie publishers like Big Fish, Real Arcade, Popcap, Oberon, and Reflexive.

I say that because from the early looks of things, Kongregate allows developers to promote their games on the site in a much less restrictive way than other indie publishers. You're allowed to have in-game URLs that link to your own site. You're allowed to ask for email addresses, and to upsell your other games. And you can get your game on their site without a contract or paying a fee (although a small fee would not be a bad way to avoid game-spamming or flooding).

This is a huge difference from other publishers. Indie publishers rarely want exclusive contracts, so developers treat them like stores: We want our games in every store to maximize our profits. But indie game publishers, unlike traditional stores, don't want the game developer to have any access to their customer base, meaning no in-game URLs or mentions of the developer's website, and no asking for email addresses. I don't blame publishers for that, because of how their business model works.

But Kongregate has something else up their sleeve, and at least at this early stage it looks like they are treating the developers as kings. Which I like. After all, the devs are the ones providing the content for the site. Kongregate's business model appears to not be about driving sales of full versions, so they can give more freedom to their game developers in that regard. I'm actually not quite sure how they're going to be making money (advertising?), but they've recognized that because developers are the ones actually generating the content, that it's best to let them do what they want within the confines of the law, and not stifle them, which can lead to backlashes ala Friendster. Kongregate's approach makes the other publishers look a bit old-fashioned.

They do have some downsides. Right now, it's only Flash games, with Shockwave coming down the road. They're not dealing with downloads as far as I know. So their target developer is a bit different than the other game publishers.

I wish Kongregate a lot of luck. Being friendly to developers means they'll get more attention from them, especially when Kongregate's traffic increases. It could change the way the other publishers do business.

What do you think of Kongregate ?
UPDATE Jim Greer from Kongregate responds to my post, in the first comment below.

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Billigflug wrote: Sep-1-08, 12:09 am

I really like the Kongregate approach to tread their developers. I am pretty sure that they have the same goal to maximize their profits, but the strategy is much better. It got something from google, that does nearly everything to don´t give their employers any reason to go home:)

mook wrote: May-30-07, 5:09 pm

That's right, rather than worry about the definition of a publisher, the important thing is how they can help a game developer spread the word about their studio and offer a way for the developer to be financially rewarded for their hard work. Hopefully, they would help small developers while keeping a decent level of quality.

Hanford wrote: Mar-19-07, 1:17 am

Indie: From the traditional brick-and-mortar standpoint Kongregate is not a publisher. But the bottom line is portals are the ones who matter now, and they're the ones who pay. They are the new publishers. Think about what you wrote:

When I say publisher, I mean somebody who will publish, promote, and most importantly “pay” me for my game.

You may not think of it as "publishing", but practically all game portals market, promote and pay game developers for their games. Including Kongregate. And when they release a game on their site, what are they doing? They're publishing it!

So, I use the term "Publisher" under a broader definition than you. Portals are the gatekeepers, they're the ones writing the checks, and they're a huge source of customers. Call them what you like, I'll call them a publisher.

Thanks for commenting. Here's a bit more about my take on this: "Game portals a re the new publishers":http://blog.hanfordlemoore.com/2007/03/19/game-portals-are-the-new-publishers

Indie wrote: Mar-18-07, 10:36 pm

I'm sorry, but you are either very misinformed, or not familiar with the term "publisher." When I say publisher, I mean somebody who will publish, promote, and most importantly "pay" me for my game. I am a member of Kongregate, and a developer, and they do not "publish" games, they are a portal. Big difference. I have spoken to Kongregate community manager Greg McLanahan about game sponsorship, but it is a "sponsorship" not unlike Armor Games or Crazy Monkey, and *not* a publisher. Please get your facts straight.

Thanks!

Jim Greer wrote: Jan-26-07, 2:47 pm

Hanford -

Thanks for the write-up! I'm glad that we're succeeding in being developer-friendly. You're absolutely right about our attitude on full versions - we're not in the downloadable business, but developers who want to promote their downloadables on our site are 100% free to do so. We don't have a downloadable store because that isn't our focus - most developers have their own site for these purchases in any case.

As for how we're going to make money, you're right - through advertising. Ads are a large and growing share of the revenue for many game portals - I know that Shockwave.com makes more on ads than on downloadable sales, for instance. And as we've said we'll be splitting that ad revenue with the developers, up to a 50% share. No one else is anywhere near that generous as far as I know.

We will also have a second revenue stream in microtransactions - we'll have some premium features on the site (private chat rooms, exclusive collectibles, etc). We'll also be opening up the microtransaction payment system for developers to charge for premium content in their own game. So you might decide to make the first 3 levels of your game free, but to charge $0.25 per level after that, or $3 for the full web game.

So far game-spamming hasn't been a problem - people are quick to rate poor games as such, and flag games that shouldn't be there at all.

As for Shockwave games, we're absolutely going to support them - we have a lot of competing priorities at the moment but I would be surprised if we didn't get this one done in February. We've got a list of developers to contact when we do that, and you're on it...

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