The House the Mouse Built
After three days in Disneyland, it's hard not to be awed by the whole Disney empire. Of course, Mickey Mouse is the branding, trademark, mascot, and symbol of Walt Disney's legacy.
Even more interesting: Mickey came about because Walt Disney and his partner Ub Iwerks were so very successful creating someone else's Intellectual Property - a character named "Oswald the Lucky Rabbit" for Universal Pictures. Because it was not Universal's IP, not Disneys, after it became successful the production company demanded that Disney reduce his fee per short or get cut out of the contract entirely. Disney refused, and they snagged his animation team from under him to form a new studio to make Oswald shorts.

Disney and Iwerks decided to create their OWN Intellectual Property in response. The new character was named Mickey Mouse - and rather closely resembled Oswald in most ways.

Change the ears and tail, and who do you have?

About twenty-seven years later, Walt Disney opened Disneyland. And a little over fifty years later, we have a company that's generating as estimated $30 billion each year in revenue.

One of my former employers, Acclaim Entertainment, built most of it's foundation on licensing other people's IP. The story (or so I have heard, I haven't researched it) is that they bought the original license to do videogames based on the WWF (World Wrestling Federation) for a song. Something like a 10-year exclusive. And, to a large degree, the success of the videogame series really helped market the WWF and make pro wrestling a far, far more popular entertainment (I hesitate to call it "sport") in the mid-90's.

So did the WWF thank Acclaim for its help? No. When the contract was up for re-negotiation, they realized that they now held the power, and their license was worth a great deal more money than Acclaim had been paying for it. So they jacked up the price by more than an order of magnitude, and Acclaim walked away from the deal. I believe the attitude from Acclaim's head honchos was, "We MADE you, we can go make someone else."

They tried to "make" the ECW (Extreme Championship Wrestling) into the new WWF, and failed. Acclaim went bankrupt, shut down, and now exists in name only. Unlike Disney, they weren't able to stage a comeback.

When I was at Singletrac, I got mad at my boss at the time, Mike Ryder, when he announced one day that Singletrac was in the Intellectual Property business (as in, making IP). I voiced my frustration privately by saying, "Gee, I thought we were about making videogames." However, I now understand where he was coming from (though I think he was going about it the wrong way). If you don't own the rights to the property, you will always be just a "hired gun." You may be a highly valued hired gun (so valued that you might eventually be bought by the people you do work for, as eventually happened with Pixar and Disney). Or you may become commoditized, and replaced (as happened with Walt Disney's production studio in 1928, or Acclaim in the late 1990's).

Owning the Intellectual Property rights certainly doesn't entitle you to anything. The world is not likely to beat a path to your door and offer you wheelbarrows full of money to parcel out a portion of your rights. Well, okay - maybe it WILL, but please tell me how, because I haven't figured out how, yet.

But it does put you in the driver's seat. From a more personal perspective: Void War isn't exactly a household name, nor has it made me any significant amount of money. But owning the rights, free and clear, to a completed title that is out there selling and generating some minimal amount of revenue has opened a ton of doors and generated a lot of opportunities that wouldn't have been there otherwise.

Yet in the retail-game side of the business, we developers routinely sell our birthright for a mess of pottage, to the point where publishers have made ceding all rights and ownership of the property a standard part of their "boilerplate" contract with developers.

It seems to me that game developers should take a long, hard look at the stories of Acclaim and Disney.

Labels: Biz

- posted by The Rampant Coyote @ 10:55 PM (Permalink)