However, when publishers distribute a
game on a console system, they must enter into a
strict licensing agreement with the console maker,
in which they agree to pay a licensing royalty for
every unit sold. Typically this ranges from $3 to
$10 per unit; that is on top of the retail markup,
advertising, shipping, overhead, and development
costs for the unit.
Here is how the responsibilities for a typical third
party console licensing deal breaks down:
Publisher??™s responsibilities:
?· Come up with game concept
?· Develop the game
?· Test the game
?· Market the game
?· Distribute the game
Console maker??™s responsibilities:
?· Approve the game concept
?· Test the game
?· Review and approve the ?¬? nal game
?· Manufacture the game
Console licensing agreements generally give
the console maker the right of ?¬? nal approval, which
means that if they do not approve of the game or its
content, they can prevent it from being released. The
testing and approval process can be quite rigorous.
The console maker wants to ensure that the game
works under all conditions and that it meets their
quality standards.
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