3D Realms still in business, $20M Duke Nukem Forever bill revealed

[Noja87]

3D Realms still in business, $20M Duke Nukem Forever bill revealed
By Tor Thorsen, GameSpot
Posted May 18, 2009 5:38 pm PT

Texas studio issues statement confirming elimination of game's team, but asserting its existence continues despite having had to shoulder massive development costs solo.

So far, the month of May has been the most tumultuous for 3D Realms since the studio's inception in 1987. On May 6, reports that the Texan studio--which had been working on Duke Nukem Forever since 1997--had shut down were apparently confirmed by webmaster Joe Siegler. Two days later, the shop issued a group "Goodbye" accompanied by a photo of nearly three dozen staffers.


The $20 million game.


Then, on Friday, May 14, would-be Duke Nukem Forever publisher Take-Two Interactive (Grand Theft Auto, BioShock) sued 3D Realms' parent company, Apogee Software Ltd. According to the Bloomberg news service, Take-Two accused 3D Realms of failing to deliver on its contractual obligation to produce the game after being paid $12 million in 2000. It sought an immediate temporary restraining order preventing the release of any Duke Nukem Forever assets by Take-Two.

Today, 3D Realms hit back at Take-Two in the form of a statement sent out by CEO George Broussard to several media outlets, including GameSpot. In it, the company defiantly declares that it is not going out of business.

"Despite rumors and statements to the contrary, 3D Realms (3DR) has not closed and is not closing," reads the statement. "3DR retains ownership of the Duke Nukem franchise. Due to lack of funding, however, we are saddened to confirm that we let the Duke Nukem Forever (DNF) development team go on May 6, while we regroup as a company. While 3DR is a much smaller studio now, we will continue to operate as a company and continue to license and co-create games based upon the Duke Nukem franchise."

The statement then lays out 3DR's version of the tangled series of events which led to this month's dramatic developments. It claims that Take-Two has not given 3DR a single cent in signing bonuses or advances for DNF, but instead paid the $12 million mentioned in the suit to defunct publisher GT Interactive. (The publisher was absorbed by Atari parent Infogrames in 1999.) 3DR contends that, in 2008, it was paid a $2.5 million advance by Take-Two for "an unannounced game," and the only money it ever received for DNF was a $400,000 advance from GT Interactive.

To date, 3D Realms claims it has sunk over $20 million of its own money into Duke Nukem Forever, and that at of the end of 2008, it realized it required outside help to continue. "Late last year, 3DR began negotiations with Take-Two to provide funding to complete the DNF game," read its statement. "In the meantime, 3DR was hitting mutually-agreed milestones, despite not having a new agreement finalized. Take-Two was well aware that 3DR needed the funding to continue the DNF game development."

By 3D Realms' account, "Suddenly, after months of negotiations, Take-Two materially changed the parameters of the proposed funding agreement. 3DR informed Take-Two that it could not financially afford the changes Take-Two was suggesting and would be forced to release the team if an agreement was not reached."


Artist's interpretation of the monster legal fees the Take-Two/3D Realms spat will generate.


"Take-Two made a last-minute proposal to acquire the Duke Nukem franchise and the 3DR development team. Take-Two’s proposal was unacceptable to 3DR for many reasons, including no upfront money, no guaranteed minimum payment, and no guarantee to complete the DNF game. From 3DR’s perspective, we viewed Take-Two as trying to acquire the Duke Nukem franchise in a 'fire sale.' Those negotiations fell through on May 4, a deal never materialized, and the DNF team was sadly released a few days later."

Though it would not address the specifics of Take-Two's suit, 3D Realms statement did say the legal action is "without merit" and "a bully tactic to obtain ownership of the Duke Nukem franchise." It revealed a New York judge has denied Take-Two's request for the restraining order, and promised to fight on.

"We will vigorously defend ourselves against this publisher," read the statement's final line.

For the moment, 3D Realms appears to have the last word. "We have no further comment on the matter at this time," was all a Take-Two rep would say on the looming legal battle.

---

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[snickothemule]

George Broussard emailed this to kotaku not long ago:

3D Realms Release – Pertaining to Recent Events Surrounding Duke Nukem Forever Dallas, TX (May 18, 2009) – In light of recent press articles and statements by Take-Two (to the media and in a lawsuit), we want to set the record straight on some issues.

Despite rumours and statements to the contrary, 3D Realms (3DR) has not closed and is not closing. 3DR retains ownership of the Duke Nukem franchise. Due to lack of funding, however, we are saddened to confirm that we let the Duke Nukem Forever (DNF) development team go on May 6th, while we regroup as a company. While 3DR is a much smaller studio now, we will continue to operate as a company and continue to licence and co-create games based upon the Duke Nukem franchise.

As some of you may know, Take-Two filed a lawsuit last week containing various accusations and claims against 3DR and the uncompleted DNF game. Take-Two never paid 3DR advances or any signing bonus or any other funds related to DNF, up until July 2008, at which time they paid $US2.5m in connection with another agreement for an unannounced game. This is the sum total Take-Two has paid 3DR in connection with DNF. Take-Two claims that they paid $US12m to GT Interactive/Infogrames to acquire the publishing rights for the DNF game. To be clear, 3DR was not a party to that transaction and did not receive any money from it. When the DNF game was originally signed with GT Interactive in 1998, GT paid 3DR a $US400,000 signing bonus. Up until July 2008, this was the only publisher money we received for the DNF game. Meanwhile, 3DR put over $US20m into the production of DNF.

Take-Two retains publishing rights for the DNF game, although 3DR retains certain rights to sell the game directly to the public. Late last year, 3DR began negotiations with Take-Two to provide funding to complete the DNF game. In the meantime, 3DR was hitting mutually-agreed milestones, despite not having a new agreement finalised. Take-Two was well aware that 3DR needed the funding to continue the DNF game development. Suddenly, after months of negotiations, Take-Two materially changed the parameters of the proposed funding agreement. 3DR informed Take-Two that it could not financially afford the changes Take-Two was suggesting and would be forced to release the team if an agreement was not reached. Take-Two made a last minute proposal to acquire the Duke Nukem franchise and the 3DR development team. Take-Two’s proposal was unacceptable to 3DR for many reasons, including no upfront money, no guarantee minimum payment, and no guarantee to complete the DNF game. From 3DR’s perspective, we viewed Take-Two as trying to acquire the Duke Nukem franchise in a “fire sale.” Those negotiations fell through on May 4th, a deal never materialized, and the DNF team was sadly released a few days later.

Less than a week after the DNF team was released, Take-Two filed its lawsuit in New York, seeking immediate temporary injunctive relief. The court denied Take-Two’s request for a temporary restraining order. While we cannot comment on the details of the ongoing lawsuit, we believe Take-Two’s lawsuit is without merit and merely a bully tactic to obtain ownership of the Duke Nukem franchise. We will vigorously defend ourselves against this publisher.

So all they need is more money. And they can keep making duke nukem forever. Yay!

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[Squall-Leonhart]

this is the kind of **** i expect from Take-Two... seriously.

Anyone want to invest in 3DRealms?, i reckon get DNF finished and we'll see stock hike.

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[masta.g.86]

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[skoreanime]

I'd invest in 3DRealms if the big man up top would just let me win the upcoming $50million lottery

[Squall-Leonhart]

if every member of emuforums donated $100, they'd have $20,769,800

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[Rebel_X]

I guess DNF wont see the sunlight anytime in the near or far future, also 3DR is really dying and might be their last gasp in the scene.. I hope I'm wrong..

[Demi Fiend]

Is it true they already spent 20 million in this game ?? LOL... They could have donated all the money for charity. Too much for a game........ Pathetic. This kinda money should be invested in essential things.

[skoreanime]

Rather old article but it puts it nicely.

Game Creator: How much does it cost to make a game?

And remember the inflammation of currency too. $20million isn't that much if you realize just how long they've been working on this project...

[Demi Fiend]

But in this case they didn't even released the game. Will it ever be released ?? And why they needed to put 20 million in a game like Duke Nukem... Geez. If it were FFXIII or any other game with a lot of content I could even comprehend. It's just a simple FPS game. How many people and how much time is needed to develop a FPS? I think they bought nice mansions and some nice cars with the money

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Last edited by Demi Fiend; May 19th, 2009 at 07:58..

[snickothemule]

1.66 million a year for a company to write a game doesn't sound like very much when you factor in wages for employees, taxes, engine licensing, hardware updates, etc.

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[skoreanime]

Originally Posted by Demi Fiend

But in this case they didn't even released the game. Will it ever be released ?? And why they needed to put 20 million in a game like Duke Nukem... Geez. If it were FFXIII or any other game with a lot of content I could even comprehend. It's just a simple FPS game. How many people and how much time is needed to develop a FPS? I think they bought nice mansions and some nice cars with the money

Say that after you tried making a game like that a decade ago It takes a lot of money to even start thinking of developing a game. The original team working on the project need a decent wage, then the studio probably hires many free lancers to fill in spots they didn't forsee.

Then like snicko said, take into account the taxes, the budget for the developing tools, engine licensing, ad campaign, material costs etc... Anything less then $5million today to make a game for the current gen console or PC would be laughable.

*Edit

One of my best friends is a free lance 3D developer when he feels like it, and he makes a crap load of money when he does. Studios will dish out the money for freelancers if they have the skill. And these projects take months, years. Don't ever assume making a game, any genre, is a simple task. Maybe for a handheld and the Ipod, but for the PC and console gaming?... Yeah, right

[Demi Fiend]

That's why they are so concerned with piracy then. 5 million to create a single game is a lot of money. (20 million is an absurd). That also would explain why a lot of gaming companies are decreeding bankruptcy. If a 20 million dollar game sells, it's fine, but if it fails, well, then they're totally screwed. Anyway.. Spending all that money on such a trivial stuff as a game is a joke. Besides, I'm tired of seeing complaints about those millionaire games. It seems the old and cheaper games used to entertain people more.

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Last edited by Demi Fiend; May 19th, 2009 at 11:46..

[Samor]

shenmue: $70 million

gtaiv: $100 million

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[Demi Fiend]

shenmue: $70 million

Holy ****... That explains why Sega went out of business for some time. Shenmue isn't a bad game but.. 70 million, holy crap... I doubt they have recovered their investment with Shenmue sales.

Edit:

Just found this:

Sales

Considering the high production costs and high critical praise, Shenmue experienced disappointing sales. According to IGN, the game, which cost an unprecedented $70 million to make,[14] would have had to be purchased twice by every single Dreamcast owner in order to turn Sega a profit. The 70 million investment presumably included the budget for the resources for additional sequels. The Sega Saturn version included the plot of both the first and second games at the very least, and although the full extent may never be known, a significant portion of the budget quoted for "Shenmue" was used on resources for future chapters, and the characters, plot and environments/gameplay of at least the entire second game (Shenmue II) existed in rough form before the first game was released.[15][16] The game was the 4th best selling title on the Dreamcast and one of the six titles to sell over a million units worldwide.[17] Shenmue is consistently listed as one of several key Dreamcast titles (most of them Sega productions) that ensured the console enjoyed solid sales during the Christmas season of 2000.[citation needed]

http://en.wikipedia.org/wiki/Shenmue#Sales

It seems the 70 million budget were used for both Shenmue and Shenmue 2. 35 million each. Guess they didn't had another 35 million to produce the Final game, Shenmue 3. That's what happens when you spend that kind of money !!!!!!!! Dammit.... All we have is an awesome but incomplete series....

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Last edited by Demi Fiend; May 19th, 2009 at 22:52..

[bobrocks95]

Originally Posted by Demi Fiend

But in this case they didn't even released the game. Will it ever be released ?? And why they needed to put 20 million in a game like Duke Nukem... Geez. If it were FFXIII or any other game with a lot of content I could even comprehend. It's just a simple FPS game. How many people and how much time is needed to develop a FPS? I think they bought nice mansions and some nice cars with the money

..........................

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Originally Posted by Halo 3: ODST review

The game's audio and sound were almost universally lauded. A significant departure from the consensus was offered by Kuchera, who wrote that the saxophone touches "[sound] like the softcore porn they show on Cinemax after midnight".

[Cheesus]

Originally Posted by Demi Fiend

But in this case they didn't even released the game. Will it ever be released ?? And why they needed to put 20 million in a game like Duke Nukem... Geez. If it were FFXIII or any other game with a lot of content I could even comprehend. It's just a simple FPS game. How many people and how much time is needed to develop a FPS? I think they bought nice mansions and some nice cars with the money

I'm sorry to say, that if both DNF and FFXIII were to come out tomorrow, the difference in sales of the 2 will be minute if at all.

Right now, the Duke is getting WAY more press than FFXIII has ever gotten. Not to mention that, much like FF has its fanboys, Duke has its own. With such a long production cycle and so much controversy, this game will be a guaranteed hit, whether its incredible or merely playable.

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Originally Posted by TheCloudOfSmoke

"Save the balls, save the world."

[Demi Fiend]

Only IF it is released. No one is sure if it will.

[strike105x]

i'd like to say this if i had to choose between DNF and FF XIII, considering Square-Enix from when it became "Square-Enix", i would choose without hasitation DNF. To bad i aint rich :/ or i would sponsor them

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[Bogard]

I know I sound crazy when I say this...

It seems to me, at this point, that all this drama and action surrounding 3D Realms just seems fake, or set up for a massive "fooled you" at E3, or some other convention.

Although it's pretty much fact by now we won't be seeing the same DNF, if ever.