Co-Production Contracts in the Games Industry: A Guide for Developers

Introduction

The games industry is a dynamic and complex field that constantly offers new challenges and opportunities. One of these options is co-production. Co-production deals can be a great way to generate needed funding, especially for young development teams. They offer an attractive alternative to purely commissioned work, as they provide not only financial support but also the opportunity to participate creatively and develop one’s own skills. In this article, we will look at co-production agreements in the games industry and what computer game developers should keep in mind.

What are co-production contracts?

Co-production contracts are legal agreements between two or more parties who agree to jointly develop and produce a project. In the games industry, this typically refers to the joint development and production of a video game. Often there is a larger and a smaller partner, although this does not necessarily have to be the case.

Especially if a partner is of lesser economic importance or is, for example, an indie studio, it can be crucial to pay attention to a fair contract with equitable terms. This type of contract allows the parties involved to pool resources, talents and skills to achieve a common goal. They can be development studios, publishers, or even independent developers working together to create a game that is bigger and better than any one party could create on their own. Co-production deals can also serve to spread the financial risks associated with developing a new game, and they can provide access to new markets and technologies.

Advantages of co-production contracts

One of the main advantages of co-production agreements is the possibility of receiving additional funding. Some countries in Europe offer additional funding for co-productions, which can significantly reduce the financial burden on developers. In addition, co-production agreements allow access to new markets, collaboration with international teams and the exchange of expertise and resources.

Rights and marketing in co-production agreements

An important aspect that must be clarified in a co-production agreement is the question of rights and marketing of the final product. As a rule, the contract specifies who has the right to market and sell the game. This can be one of the parties or both parties together.

In addition, it is critical to clarify ownership of intellectual property (IP). The IP encompasses all creative aspects of the game, including character designs, storylines, music, artwork and more. In some cases, the IP may be fully owned by one partner, while in other cases the rights may be shared.

It is important to clearly define these details in the contract to avoid future disputes. A well-drafted co-production contract should protect both the commercial interests and the creative rights of all parties involved. It is therefore advisable to seek legal advice when drafting such a contract to ensure that all aspects are properly considered.

Knowledge generation through co-production

Another advantage of co-production contracts is the possibility of knowledge generation. By collaborating with other developers and teams, you can learn new skills, discover new technologies, and benefit from the experiences of others. This can help improve the quality of your game and expand your skills as a developer.

Co-production contracts in other industries

Co-production contracts are not only common in the games industry. They are also widely used in the film and television industry, where they are used to share the costs and risks of production and provide access to international markets and funding.

In the film and television industry, co-production agreements often enable cooperation between producers, directors and studios from different countries. This can lead to a film or television series reaching a wider audience and incorporating more cultural perspectives. Similar to the games industry, these contracts can also help spread the financial risks and provide access to additional resources and expertise.

In addition, co-production contracts can also be found in other creative industries such as the music industry and the literary industry. They allow artists and writers to collaborate on joint projects and can help create new works that appeal to a wider audience.

Regardless of the industry, it is important that all parties involved in a co-production agreement fully understand the terms of the agreement and what their rights and obligations are. This can help avoid future conflicts and ensure that all parties benefit from the collaboration.

Difference to Work-For-Hire Contracts

Unlike co-production contracts, where both parties are equal partners, work-for-hire contracts are an arrangement where one party (the contractor) creates a work for another party (the client). In this case, the client usually retains the rights to the work and the contractor receives a fixed remuneration for his work.

Conclusion

Co-production deals can be a great way for game developers to expand their resources and gain access to new markets and funding. They also allow the sharing of knowledge and skills, which can help improve the quality of the game and expand the skills of the developer. However, it is important to carefully examine the conditions and be aware of the possible risks. With proper planning and preparation, co-production contracts can be a valuable resource in the dynamic world of game development.

Author: Marian Härtel

Marian Härtel ist Rechtsanwalt und Fachanwalt für IT-Recht mit einer über 25-jährigen Erfahrung als Unternehmer und Berater in den Bereichen Games, E-Sport, Blockchain, SaaS und Künstliche Intelligenz. Seine Beratungsschwerpunkte umfassen neben dem IT-Recht insbesondere das Urheberrecht, Medienrecht sowie Wettbewerbsrecht. Er betreut schwerpunktmäßig Start-ups, Agenturen und Influencer, die er in strategischen Fragen, komplexen Vertragsangelegenheiten sowie bei Investitionsprojekten begleitet. Dabei zeichnet sich seine Beratung durch einen interdisziplinären Ansatz aus, der juristische Expertise und langjährige unternehmerische Erfahrung miteinander verbindet. Ziel seiner Tätigkeit ist stets, Mandanten praxisorientierte Lösungen anzubieten und rechtlich fundierte Unterstützung bei der Umsetzung innovativer Geschäftsmodelle zu gewährleisten.