In a bold move, the CEO of Hooded Horse, Tim Bender, has sparked a conversation about the fairness of game publishing contracts. He argues that these agreements often violate fundamental contract principles, creating an uneven distribution of risk.
Speaking to PC Gamer, Bender, the founder and chief executive of the Manor Lords publisher, highlighted the issue of risk allocation. He believes that contracts should be structured so that the party best equipped to handle potential risks bears those risks.
Hooded Horse's approach to developer contracts stands out. Their 'standard' contract offers developers a 65% revenue share, a significant departure from industry norms. The publisher only takes a larger share if they have partially funded the game's development. Additionally, Hooded Horse does not employ the common practice of recoup, where publishers recover their costs first from game revenues.
Bender describes the recoup system as "fundamentally stupid." He argues that many games with potential could have recovered or improved if not for the burden of recouping costs. "If only that hadn't been there, they could have been supported," he says.
He continues, "No publisher makes its money by recouping from underperforming games. Publishers thrive on the success of their well-performing titles. Without recoup terms, there's a better chance for those other games to succeed. Developers are more incentivized, and everyone benefits."
Last year, Bender made headlines by stating that Hooded Horse would not work with studios utilizing generative AI, calling the technology "cancerous."
This bold stance on contract principles and AI technology has sparked debate within the gaming industry. What are your thoughts on Bender's arguments? Do you agree that the current contract structures need an overhaul to support developers better? Share your opinions in the comments below!
