The games industry’s health is looking fragile right now, to say the very least, thanks in no small part to the mass layoffs it’s been hit with over the last year and a half, and the ballooning costs of developing games have contributed to that significantly. In recent months, there’s been no shortage of reports about games that have cost eye-watering sums of money just to get made- though there are, thankfully, at least some examples of games being made on small budgets and going on to find incredible success.
In 2024, there has been no bigger success than Pocketpair’s survival game Palworld, which accrued 25 million players within just a month of release. Speaking with Bloomberg, Pocketpair CEO Takuro Mizobe revealed that the game’s budget was under ¥1 billion, which is roughly $6.7 million. It’s unknown if that’s limited to development costs, or if it also includes marketing costs.
Against that relatively tiny budget, Palworld has made “tens of billions of yen” in profit. “Big-budget triple-A games are not for us,” Mizobe says.
Looking at the current state of the industry, it’s hard to argue against a studio’s desire to remain small, especially with AAA studios suffering layoffs in spite of their games enjoying widespread success. Marvel’s Spider-Man 2, for instance, has sold over 10 million units already, but it had a massive budget of $315 million, and developer Insomniac Games ended up as one of several first-party studios to be affected by PlayStation’s mass layoffs.
Then there’s Respawn Entertainment, a studio that has enjoyed consistent, widespread success with Apex Legends and the Stars Wars Jedi games. As part of EA’s layoffs, however, a number of Respawn staff have lost their jobs, while the studio’s unannounced first-person Star Wars shooter has also been cancelled.
Interestingly, Mizobe has also said that he’s open to considering acquisition offers for Pocketpair, so if that does lead to something concrete, it should be interesting to see whether the studio ends up having to expand beyond its original plans.
Palworld is available in early access on Xbox Series X/S, Xbox One, and PC, and Pocketpair is “in talks” to bring the game to additional platforms.
