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What to look out for in Mobile Game Publishing Contracts

by Gabriel Rivaud, Head of Publishing

As a game developper you might consider working with a publisher at some point. You will probably sign a licensing agreement which hands over the rights of exploitation of the game to the publisher. This post aims to highlight what you should look out for before signing the binding sheet of paper in front of you.

Set the revenue sharing standard

The revenue share may vary depending on the publishers engagement in the process of creation of the game. Most publishing contracts propose a 50/50 revenue share if the game is handed over to them as a finished product ready for launch. However, if the developer needs upfront financing to finish the game, publisher usually propose a 70/30 or 80/20 deal.

Pay close attention on how the profit is calculated. It is standard to calculate profit by deducting the marketing costs from the revenue. Marketing costs can be the total spend on ad campagnes plus an added sum for the time to manage these campaigns. Aways make sure that the terms are clearly stated and the sums capped in order to avoid unforeseen fees.

Secure a minimum marketing budget 

This budget should be financed solely by the publisher. You may wish to ask for a minimum amount of money invested in marketing on your game each month. However, it is highly probable that your publisher will answer that the amount invested depends on the ROI of the campaigns. Still worth a try!

Accounting standard and transparency

You should request access to the data analytics tool used by your publisher to track key KPIs such as DAUs and retention to check the general health of you game after handing it over.

Also secure the right to access to iTunes connect so that your can oversee in app purchase revenue and a ask for read only account of the revenue tracking and attribution tool to check ad revenues generated by your game.

Finally, you have the right to a detailed report every month of the spend and revenues generated by your game segmented per OS and by country.

Negotiate a termination clause 

Insert a clause which allows you to reclaim your game of the publisher does not achieve a set financial milestone. You should take into account that the first month or two may not generate much revenue due to launch delays and user acquisition tests to find the best performing creatives and audience segments. 

Don’t reject a low first objective. Do, however, set several milestones such a set amount of profit 6 months after the launch and 1 year after the launch. Then set a minimum amount of profit per year on a rolling basis.

Put your studio's logo on the splash screen

You have the right and should ask the publisher to put your studio’s logo on the splash screen of the game to get your name out there and reach other potential publishers.

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