Live service games, or ongoing games with regular post-release update, are one of the biggest and most competitive genres in the games industry. These games attract high player engagement and investment by design, meaning they can be a lucrative investment for game studios. However, a new report from Griffin Gaming Partners suggests that, while many studios are making and supporting live service titles, they often face production and technical challenges that hamper development.

Griffin Gaming Partners’ 2023 Game Development Report spotlights several issues with live service game development, despite their attractiveness to developers. The report’s results draw from 537 surveyed studios and interviews with over 60 industry experts. The report finds that 65% of those studios are actively working on games with live service-style post-launch updates.

However, 68% of producers say their pipelines can’t sustain a live service project, while 53% of large studios “expect to struggle with managing their technical debt.” Game development costs in general are rising precipitously, and game development is becoming more complex over time. Because of this, 88% of game developers surveyed are looking into new tools to incorporate into their workflows.

Jiten Dajee, Rendered VC partner, said in the report, “Games with live-service dependent go-to-market strategies require developer efficiency that today’s game tech isn’t built to deliver. Some teams fall flat. Others build new best-practices and invest in emerging tools to run circles around their competitors. Those are the companies of the future.”

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The challenges of live-service games

According to the report, game development costs are growing thanks in part to the competitive market, and studios are pursuing live service as part of their financial plan. 95% of the studios surveyed said they either were working on or planned to release a live service title in the future. However, those content updates can be a major contributing factor to the game’s expense.

The report quotes Jon McElroy, VP of engineering at Annapurna, who says: “As the medium continues to advance, teams grow naturally more ambitious and the complexity of the problem space increases. While some costs have come down in the last decade from commodity development tools, the overall cost of development continues to go up.”

The Griffin report suggests that tech across almost all development departments is falling short of expectations. These include iterative or collaborative workflows, extended build times, customized middleware failure and inaccurate production schedules and budgets. Failures from any part of the studio can result in bugs or outages, which in a live service game means loss of a significant percentage of revenue.

There’s a further wrinkle to the future of live service: Newzoo recently predicted that live service games would start to drop off in 2024, in part because users no longer have as much free time to devote to a single game. Instead, they’ll want to play more and varied premium titles. Any lack of interest in a live service title likely translates to a slower income stream, which likely doesn’t help with game development costs mentioned in the Griffin report.

Eye towards innovation

As live service games become more expensive to make and sustain, game developers note that the tech and tools available to them are not as efficient as they could be. The Griffin report says that this is creating demand for new tools, in particular cloud and AI-based tools as well as improved infrastructure. Studios are also shifting from a “build it yourself” mentality to buying these tools from third-party teams.

Notably, the report spotlights AI as a particularly attractive emerging tool. Surveyed respondents said they expected AI to provide value in several departments, especially art and data analysis. They also say they expect AI to be a staple in NPC creation, game system design and QA processes.

Matt Wyble, COO of Second Dinner, said of AI tools: “It’s always been David vs. Goliath for small studios, and the rising costs of developing games make it harder every year. A new wave of tools and services, many AI-powered, give David a mecha suit to even the odds.”

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