Andy Gavin, who launched Naughty Dog alongside Jason Rubin back in 1986, has become quite active on LinkedIn, sharing fascinating glimpses into the company’s formative years. Recently, he’s been reminiscing about the studio’s financial journey, revealing the mounting costs associated with developing some of Naughty Dog’s early games. These escalating expenses played a significant role in their decision to sell the company to Sony in 2000.
Gavin shared, “In our early days during the 80s, each game cost under $50,000 to produce. By the time we developed ‘Rings of Power’ between ’88 and ’91, costs had doubled to around $100,000. That game turned a modest profit in 1992. We reinvested those earnings into ‘Way of the Warrior’ in 1993. Then came ‘Crash Bandicoot’ from ’94-96,’ which demanded a staggering $1.6 million. Fast forward to ‘Jak and Daxter’ from ’99-01′, and we were handling a budget that exceeded $15 million. By 2004, developing AAA titles like ‘Jak 3’ could cost as much as $45-50 million, and expenses have continued to climb.”
These financial pressures led to the pivotal decision to align with Sony. Gavin explained that selling the studio was more than just securing financial stability; it was about ensuring Naughty Dog could continue to create exceptional games without being overwhelmed by ballooning costs. The fear of a single misstep leading to potential downfall was a constant stress.
Gavin’s revelations have sparked considerable discussion, especially in his post’s comments section, drawing insights from others in the gaming sphere. James Marcus, a senior artist on Splitgate 2 at 1047 Games, commented, “It’s unfortunate how much costs have surged. Many developers are now hesitant to take creative risks and often sell to large corporations to avoid the risk of bankruptcy from a possible flop.”
There are certainly trade-offs when studios merge with giants like Sony. The downsides can include restructuring or layoffs, as Naughty Dog discovered during Sony’s 2024 round of staff cuts. For Firewalk Studios, creators of Concord, their 2023 acquisition by Sony seemed to offer little benefit, with the studio closing soon after the game launched. Being acquired by Sony has its ups and downs, but in today’s gaming landscape, the escalating cost of making AAA games is a stark reality.
