Epic VP [Jay Wilbur] indicated that the average game project budgets for the PlayStation 2/Xbox game generation was $2 to 6 million, whereas the average budget for next-gen gaming can be $8 to 20 million. Noting that the average team size for the PS3/Xbox 360 generation is 60 to 80 people, he claimed that a combination of outsourcing and engine licensing enabled companies such as Epic to run at a much lower full-time employee base and cost.
Interestingly, one motivation behind the studio's formation is to entice Japanese developers into considering using more middleware--Epic's, in particular--to keep costs down as average development budgets continue to rise. Traditionally, Japanese developers avoid reusing the same engine, even internally from game to game, preferring to take the more costly route of developing new tech specifically created for each game and platform. This strategy is becoming less feasible, however. Capcom recently spoke on its new internal Framework engine, which is being used across the company's various next-gen projects. The company has no intention of licensing the engine out to third parties, which leaves the door open for middleware providers such as Epic to step in and do so.