[In this extensive interview conducted at GDC China, Bill Roper, former design director of Cryptic Studios, discusses what he sees as the broken model of MMO development in the West, and explores the negative reaction gamers had to Cryptic's Star Trek Online and Champions Online. You can also read the first part of this interview, which dives deep into Roper's experiences developing Hellgate: London.]

After the debacle that was Hellgate: London and the closure of Flagship Studios, company founder and former Blizzard developer Bill Roper joined established MMO developer Cryptic Studios as design director in 2008.

Less than two years later, Roper would resign from the company after the launches of Champions Online and Star Trek Online, each of which was criticized by gamers and reviewers.

Roper discusses gamer reaction to the MMOs, and also delves deep into the problems he sees with MMO development, particularly with the structure of publisher / developer funding deals.

He also addresses the attachment that developers have to their products and how they should approach things in new ways to make them more economically feasible.

You've talked about having some issues with how publisher funding goes on games, particularly MMOs.

Bill Roper: I think it's a broken model, the way that funding works on a pub-dev deal. It just kind of is, right? Because the publisher wants to get the game out, so they want to figure out how to fund the game right until the game comes out. Then there's no more funding.

We always want as much time as we can. So, we start doing stuff, and invariably, when the game ships, whenever that is -- whether it's early or the right amount of time -- you have used the last amount of funding to get it out. There's never a cushion, right? And now, you have no money. So, if you don’t have another project lined up, you're screwed.

And let's say the game comes out and does well. You still could fail in the time before you get your first check, because you're typically earning out at your royalty rate, right? So, if I have a 20 percent royalty rate as a developer, and there's $5 million spent on the game, well, the game has got to make $25 million before I start seeing anything.

And if there's an online back end -- if it's a subscription game, an MMO -- that doesn't happen until... The first month is free, so there's a first month after the game is shipped where no revenues are coming in because you're still earning out with all that. There's no online revenue yet. And even if your online revenue model is different, you've got to pull out all the operations on top.

And typically, you get paid quarterly. So, it might be four, five months before you start seeing any money. And also in those deals, they almost never put anything on the back end, that back end support. They always say, "Hey, we're going to take a portion of how much money was made and use that for continuing development." But traditionally, that doesn't get front-loaded.

So, as the developer, you know that you have to keep making content and keep providing service for players, but there's no funding set aside to do it, right? It's the transition that a lot of big Western publishers have made from boxed to online, and they're still making it. Like, "Hey, you finish the game and you ship it, and then you make money."

But it's an online game. It doesn't finish there. I think logically they know it doesn't finish there. They all talk that. They all say, "We know that when the game really, you know, when work really starts," but they haven't attached the marketing model to that. They haven't attached the funding model to that.

Champions Online

And you find out that you're damned based on a bad first impression.

BR: But you're absolutely right. You can work your ass off after the game is out and do tons of fixes and do tons of changes and show that your team is dedicated, but how it ships is how people think of it. That definitely happened with Hellgate, with Champions, and to a degree with Star Trek, all those games. Like, yes, it wasn't perfect when it came out, but we're like, "Look at the first two or three patches we did. We get it!" But [players are] like, "Oh, well, no. I tried it."

I think the worst, almost the worst part is when someone plays the game, and they say, "Wow. That was really cool. I really liked that. There's a lot of potential there. I think I'll come back in six months or a year, and see how it is." They're not going to be there in six months or a year, right? That's the whole thing.

It's why the subscription is so difficult, because it's reliant upon the fact that you're going to have a certain number of people there from the beginning giving you money, and you've built your game that way,

If you're looking for continuing business models to tie into it, microtransactions are great because I know a certain percentage of people are going to buy something as they play it and as they like it, but I'm not dependent on the fact that "Oh, if I don't have 25,000, 50,000, 100,000 players -- whatever it is -- if I don't have whatever it is, if I don't have whatever my baseline number is playing, I can't operate the game." Because, you know, you're building all your costs off that, your server costs, everything, how to operate the game.

If you look at this, just look publishers persist and studios close, ultimately. That's how this industry works.

BR: Or studios get bought and become publishers.

Right. No one seems to be able to stick around. No matter how well they're doing for one year, next year they might...

BR: I think the difficulty is that... So, if I was going to make a comparison to film, right, there's a fundamental difference. Companies in film that would equate to independent developers and gaming, there's a difference they do in film.

They work on a movie, they come out with a move, and then they get rid of almost everybody. And they keep that core creative team, which might be five to 10 people. And then they say, "What's the next project?" And then they build up and do that project. They build up and they launch it, because they're still kind of in the box model.

On the gaming side -- and Blizzard is another weird example of this, I think. What gaming companies tend to do is, you don't want to get rid of that talent because they know how to use your engine, they know how to make games the way you want to make games, they become part of your culture. So, even if your game ships and you don't have anything lined up, you’re hesitant to get rid of those people because you're like, "Oh man, he's great. She's fantastic. I don't want to lose those people."

And so you figure out how the hell you're going to pay them. And I think that's another fundamental problem. Obviously, that changes if they all still have work they're doing on the product. But the trick is there's not really funding there. It's not really there.

And the other thing that tends to not happen is they don't cancel online games as readily as they will cancel a TV show. Imagine if they came out and they went like, "Well, you know, the game's been out for three or four months and it's not doing what we wanted, so we're shutting down all the servers." Because of the way they're built up, especially again, in the subscription space, "Whoa, we've got people that have six month subscriptions." Or, "They bought a lifetime sub. Oh my God! They're going to sue us." You know, you start running into these other problems.

So, publishers, a lot of times, may have to bear some brunt of that. But they're bearing the brunt, and it's built into their model of how they're sustaining as a business. Where developers, they're screwed. They close

You know, that's certainly what happened with Flagship. We just could not sustain to keep the doors open. Even at the very end, you got to the point where the board, the five founding members... We were putting our own money back into the company at the end, which as anybody in business will tell you is the stupidest thing to do.

But we felt we were very, very close to a deal to get more funding. So, we paid our final guys' paychecks out of pocket. Like, "Okay, we're going to all try to find some money and pool it together because we really think this is going to happen," and it didn't. Yeah. It's really hard. And it hasn't gotten any easier, right? [laughs] -- which is why some things have got to fundamentally shift.

Do you think that as things move to online, that frees you from publisher deals potentially? If you can go directly the users, would that make it more easy for you guys to manage yourselves?

BR: I don't know. You would like to believe so. Everybody wants to think that they can do the other guy's job better, right? I think the challenge will always be -- whether you've got a publisher you're working with, whether you're self-funding -- is how you make that transition. How do I move between project A and project B? How do I support this other thing, right? I think the biggest challenge in that way isn't the publisher, as much as how do I maintain the development, right? And a lot of that, I think, is through game design.

I think it's one of the reasons the casual market is so sexy right now. You're seeing a lot of people going into that, because it is low-risk. It's much, much shorter timelines. You know, three-month dev cycles. Games cost $75,000, with small teams. And you can crank content really quick. Turnarounds are really fast. You're getting metrics in five minutes. And they are not afraid. Because the games are free, and invariably when they launch, it says "beta," they're not afraid to have it run for six weeks and say, "Okay, that failed. Kill it."

In fact, people say that's essential.

BR: Yeah. Knowing when to stop. And it's interesting. The casual game market, in that way, on the business side, is the antithesis of core gaming, because everything is metrics-driven, and as soon as it falls below those numbers, they're like, "Okay, stop. Just cut it off because now it's not making the ROI that is required."

And you can sometimes keep the game running longer if you're like, "We're three days from an update, and we think it's going to get the numbers back up." You can kind of play that game, but the cycles are so short.

Where it's harder to get away from the big games. You're like, "Oh, God, if we shut down all the servers..." And the thing that's funny is if you think about it, the numbers of players that are impacted are so much greater on the casual side.

You know, you're worried about like, "Man, we still have 20,000 subscribers. If we shut the game off, they're all going to be really mad." And it's really interesting because on the casual side, they're like, "Yeah, we shut this game off. Yeah, we still have 800,000 users. Yeah, we're not making enough money off it. [snaps his fingers] Kill it." And they do.

I think somewhere in the middle, maybe, on the core game side, there's a balance. I don't think they can be quite so metrics-driven, but we have to be willing to say "This isn't working. How do we get out of that?"

I think the way that it tends to happen now is the slow bleed, right. "Oh, how were the revenues for this month? Oh, you didn't quite make enough. We need to trim two more people from your team." But you're still trying to keep the game alive, and you've already put years of your life into it.

And that's the other thing, too. The developers, I think become so much more attached. You work on a project for three months, yes, you're proud of it and you want to make it good, but it's three months -- as opposed to "I put four years into this game." You're like, "I'll be damned if that thing is going to die!"

So, it's harder to just burn the game, at some point, than it is on the casual side. But we have to find some ways to do that, whether that's having cheaper sustenance of the game, or just being able to say, "You know, let's just stop the game. Let's just stop the service on it."

And I think that if you're designing games that you know are going to be free-to-play with microtransactions, you're building a different game. You're building a smaller client. You're building a game that has much less stress on the backend, server-wise. It takes less resources. Its cost per user has to be so much lower, and it's easier for you to sustain that game longer.

That's the real thing that starts killing MMOs that are designed with that subscription model, with massive download and all these huge databases. It takes all this horsepower to run it. You start saying, "Oh, well it costs X amount per user to run the game." And you say, "Well, if we don't have this many subscribers, the game can't support itself," and it's a high-ish number. It's substantial.

There's a floor you hit where you're like, "Yeah, it doesn't matter if I've got 500 guys or 15,000." There's some number that's like, "Once I get below that, I'm paying in that cost." It just gets worse and worse because that's how the games are designed, technologically.

Do you think that like new business models can also alleviate some of the problems with funding for developers? Like if money is rolling off microtransactions consistently, will that be something that can keep people afloat?

BR: I hope so. I think it has to be a combination of business models, and then the way that whoever -- VC, publishers, whatever it is -- the way those funding deals for the developer are structured. Advances against royalties is just... It's almost not sustainable anymore.

If you have a company and you're like, "Look, we want to have a small, focused company that does one thing it does great -- and just do that", it is almost impossible unless you have a mega hit, and you know it's going to be huge, and you've already signed the sequel deal or something, just because of the lag in time. If you're taking advances against royalties, and I've got to pay you back in my royalty rate, it's like the publisher could make good money off a game, and I could close my studio. I mean, not great money, but good money off a game, and I close my studio.

And then they contract someone else to make the sequel if they own the IP, which they may well do.

BR: Sure. Right. And that depends, too. I have been talking with people that are going out and are like, "Yeah, I'm doing a start-up right now. So, I signed a deal, and I've got a royalty rate at 18 percent, and I got this much money up front, and I've got to pay back on my royalty, and the studio owns the IP." I'm like, "How does that ever work for you?"

It's like, "Hey, man, I'm working on it. I've got a job, and I've boot-strapped the studio up. I'm looking for the next deal." It's just like, "I was trying to get spun up, so I can do that. I found someone who's going to help me do that."

But it's so not sustainable, especially if they're asking you to make a product that they intend for you to support. It's like we're stuck in these boxed product business models and funding structures, but they want you to build something that you never leave. It just doesn't work.

I mean, there's got to be something where it's like, "Look, here's the funding. Here's how much we spend on development. Here's how much we have to spend on the marketing or whatever." Like, get all the components together. "Yup, that's the number. Okay, the first X whatever the game makes pays all that off. Then we go to the royalty rate." So, you start making money the same time the publisher makes money. Publishers are going to hate that because their whole thing is, "Look, we're funding many, many games," and they're hedging all their bets on these numbers.

Do you think there's a structure that can be put in place? Or do you think that things like you discussed, like tech being idiosyncratic, or game design style being idiosyncratic to developers, is going to be too much of a stumbling block?

I mean, obviously, they have the guilds and stuff in Hollywood. Their whole system is designed to ramp up, ramp down, and to bring people on at the right times, as we all know.

But you don't need a pool of artists at the beginning of a project. You burn through so much money so fast, with nothing to do until you enter into actual production.

BR: I think where we have seen companies try to do that is through outsourcing. So, art is a great example of that. And we really tried this at Flagship. Our intention was to do almost all outsourcing. We were like, "We're going to have like two or three artists. We're going to have a concept guy, an art lead, and a technical artist. And then we're going to outsource everyone else."

We found that there were certain things where, "Okay, we really can't wait for turnaround." You start finding ways that you have to have people more involved, or there's a certain way you want your art done, and you haven't found the right outsourcer the way you want it. "Screw it, let's just... We'll hire our own guys and teach them."

I think that's the way that you would have to make it work, to just say, "Look, here's the core team of guys in my company. These are the creative and the leads on our projects. And then when we ramp up, yes, we're going to go get..." Art is the easier one. Sound and music are easier. Programming, the most difficult, you know. Design, somewhere in between. So, there's always going to be a certain size you're going to have to maintain.

The tricky part is the down-ramping, right? If there was a way where you could -- and I think this is especially vital in the West -- say, "Great. Now we need to be making additional content. Here are all the tools. Here's the engine." Because by that point, things are really in place, right.

Star Trek Online

If you could have the ability to say, "Here are a couple of my design guys, one of my programmers, a small team of three or four guys. You're going to run this other outsource team because it's going to be far more cost efficient. Here's what I want. Here's the next content thing I want. You guys run that with these other..." You could have the smallest amount of the highest priced resources involved.

I think the challenge is that isn't what ends up happening. You end up taking your whole company and focusing on that product. So, it's hard to roll onto anything new. Again, it's very specifically [like this] in the MMO space. It's hard to roll onto anything new. You're tying up all your best people in things that honestly they shouldn't be tied in.

My lead programmer shouldn't be fixing bugs for a product that's been out for six months. He should be working on what's the next innovation. But sometimes you're just trying to manage costs, so you have the team as small as you can. "I can't free you up to go work on the next cool thing. I honestly need you to fix this stupid bug." Not stupid because it's in the game and it's affecting players, stupid because it's like, "I could have a junior programmer fix this, but we don't have any because we had to cut back."

MMOs are an incredibly difficult creature for anybody. I think that's because of the cost association that's exacerbated in the West. That's why I think they operate better here [in China], they re-use technology, they're not afraid to just go, "Yup, we're going to build like 10 off the same engine," or whatever. Yes, they all look kind of similar, but there are different games. They're not afraid to use good mechanics that work. And they can maintain larger staffs for less investment. I think that's a huge thing.

I think the tech thing is a big thing in the West, too. I think Cryptic was very smart because they have a very good set of tools. They have a very good engine. They had a very good backend. And the idea was, they were like, "This is going to be a platform."

But one of the first comments that came out, when Star Trek Online came out, were people saying like, "Well, it's just Champions re-skinned." I mean, gameplay-wise, not at all! But when you show it, it's like, "Well, yeah, we just kind of used the interface placing." Like there were enough similarities where I sort of understand what that actually meant.

Players were saying that?

BR: Yeah, players were saying like, "It's just Champions."

Do you think that's a bit cynical?

BR: Sure. [laughs] We're gamers. I think gamers are a cynical lot by nature, right, and I think that in the MMO space, and especially in the internet, where anonymity reigns supreme, it's very easy to say, "I'm going to say this really caustic cynical thing and get a lot of comments on my thread, and that's awesome."

But I also think that you have to dig past that perceived cynicism. Because at the core of that -- there was a real statement -- was the fact that there were elements of those games if you looked at it.

But they did not play this game. It was not as simple as just putting the patina on it of "Well, they're the same game re-skinned." It's like, "Yeah, there wasn't a lot of change to some of the interface elements. There wasn't a lot of change here."

This has that same feel, right, even in the way certain things are presented because they didn't have time to make another massive UI path, so things just kind of stayed the same. So, a contact would talk to you, and it's like, "Oh, yeah. That's kind of the same way I get quests in this other game. Okay." Even if there's a lot of differences and even if the gameplay is really different. So, that's the challenge. I think it's a really good model, but of course, the thing is it has to be games that people like playing.

A hard-learned lesson for me was to not just discount that stuff, was to say, "Is there something underneath there that we can really pull?" Like, no, I don't think Star Trek is really just Champions reskinned. But there was something there. There's a reason that people are saying that.

As opposed to just focusing on the words that got said and whether you agree with that or not, or whether that upset you or whatever it is... It's like, "Why do people think that?" Let's try to figure that out.

And I think there were a lot of differences, and a lot of conscious choices that got made on Neverwinter Nights that were based off of that. You know, where we said, "We have to completely do the UI ground up. We are not re-using any UI. Throw out everything for placement. Even the way we want to approach the presentation of the game and questing and everything."

We're like, "Yes, it's the same engine, it's the same backend, right. All the major tools are there. But we need to have different ways that we approach that." So, we get rid of that subtle samey-ness as much as possible.

I'm surprised this was a problem. Sure, you can see audience overlap, but they do seem like they'd draw different audiences.

BR: Yeah. I honestly don't know how much of a problem it was. It was a comment that came through. Part of it, too, was because people knew it was built on the same engine. I mean, if you look at the games side-by-side, they don't look anything alike. But I think there are elements you could look like and go, "Oh, yeah, that placement is the same." It really wasn't those [places] where every little bit was different.

I think one of the reasons you don't hear that, for example, just from experience, on like a StarCraft property -- every single one of those games they do ground-up. They don't re-use 3D engines. Which is kind of insane. Again, not the model that any right person in their head does.

"Hey, I want to start a game company, and we're going to do projects that take, you know, five, six, seven, eight years to make, and we're going to ground-up build each one of them every time. You know, we're not going to re-use almost anything." But that's why their games look very different and feel very different. They don't [reuse anything] except for things like sound libraries or things that are inconsequential in the end.

But I think that there are things... I mean, even if things like the way characters move and things like that, right. You're like, "Oh, this guy's... That weird little joggy thing, you know."

Subtle samey-ness.

BR: Yeah. There's a subtle samey-ness between them, and players didn't like that. You know, "I want this to be totally, wholly different and unique."

Probably people who weren't interested in Champions might have just sort of heard online like people gossiping, and not realize that It wouldn't have been meaningful to them. They never would have noticed it, since they wouldn't have had the opportunity to notice it, but then it starts creating negative buzz...

BR: Yeah. There's definitely a zeitgeist that occurs, this hive mind, where people are like, "Yeah!" They're never like, "Oh yeah, I read somewhere..." They're just like, "Oh, no, this does that."