In an interview with GamesIndustry.biz during Gamescom, Tim Willits, Chief Business Officer at Saber Interactive, revealed that the company "no longer has substantial development operations in North America." The region retains only publishing functions, with game development handled by subsidiaries around the world.
"We don't exclude any region," Willits stated. "Some publishers are afraid to operate in unfamiliar markets, but our philosophy is to be bold, discover talented individuals, provide them with the support they need, and create outstanding works. Excellent programmers, artists, or animators don't necessarily have to be based in California."
Willits expressed disapproval of the "financial waste" prevalent in many AAA games, comparing an unnamed recent new title to Saber's own Warhammer 40,000: Space Marine 2. He boasted, "The latter's development cost was only one-third of the former's, yet it sold 11 million more copies."
"That's the issue: major development studios in North America have a monthly burn rate exceeding $2 million. Note that this is per month," Willits said. "SnowRunner, which generated hundreds of millions in revenue, had a development cost of only $6 million. In California, that would only cover three months of development expenses. Do the math: if a large studio spends five years making a game, that's 60 months, and salary costs alone would reach $120 million."
The model described by Willits essentially involves offshoring development roles to lower-wage markets. According to GamesIndustry.biz, Saber has development studios in Serbia, Armenia, Georgia, Spain, Portugal, Sweden, Argentina, and Australia.
However, his point does hold merit: under the current operational model, domestic AAA game development in the US is clearly unsustainable. In our interview at Gamescom, Willits also pointed out that "over-specialization" among developers is another factor exacerbating the current industry crisis, though he noted that the crisis is not as severe as reported externally.