Naughty Dog Founder Reveals Budgets Of Original Games And Why They Sold To Sony

Andy Gavin, one of the co-founders of Naughty Dog, has explained why the company sold itself to Sony back in 2001. Posting on LinkedIn, Gavin said he’s been asked “countless times” why Naughty Dog took the deal, and it was all about rising development costs.

Gavin said (via SI) when Naughty Dog first started making games in the 1980s, game development costs were “manageable,” with costs for games made in the early ’80s running about $50,000 per game. For 1992’s Rings of Power, Naughty Dog spent about $100,000. For the first Crash Bandicoot game, however, costs rose to $1.6 million, with Jak and Daxter (2001) coming in at $15 million or more. Just a few years later, Jak 3’s development cost came in at between $45 million and $50 million.

Naughty Dog was self-funding all of its projects at this time, and the stress about “financing these ballooning budgets independently” became too much to bear. Gavin said rising development costs is a “systemic issue” to this day in the video game industry.

“Developers almost never have the resources to fund their own games, which gives publishers enormous leverage,” Gavin said.

Naughty Dog sold to Sony not just to help secure its financial future, but also to help Naughty Dog make the best games possible “without being crushed by the weight of skyrocketing costs and the paralyzing fear that one slip would ruin it all.”

“Looking back, it was the right call. AAA games have only gotten more expensive since then. Today’s big-budget games can easily cost $300, $400, or even $500 million to develop,” Gavin said. “Would we have been able to keep up? Maybe. But selling–to the right party–gave Naughty Dog the stability it needed to thrive; and to continue making the kinds of games we’d always dreamed of!”

Gavin left Naughty Dog in 2004, prior to the developer’s Uncharted and The Last of Us franchises coming onto the scene. Naughty Dog’s other founder, Jason Rubin, is also no longer with the company.

Gavin isn’t the only video game industry veteran to speak about rising costs. Former Sony executive Shawn Layden has said the AAA video game space is unsustainable due in part to rising development costs.

Naughty Dog is now run by Neil Druckmann, who is president of the company. He is also the writer of Naughty Dog’s next game, Intergalactic: The Heretic Prophet. Beyond that, Druckmann remains involved with HBO’s The Last of Us TV series and potentially The Last of Us: Part III.