Ladies and gentlemen, it is my great pleasure to welcome you here with us. I'm so happy that you found the time to be with us. My name is Michał Giersz. I'm so happy to have you here with us, and I also would like to extend a warm welcome to the people who are with us online. This is a special time for us. One week and a half have elapsed since the first expansion to Cyberpunk 2077 was published, and we are following what is... We are monitoring what is happening around the game. We are reading all the reviews. We are very grateful for them, and we also monitor what the reactions of the players are. We also want to show you how it looks, behind the-- what happens behind the scenes of the expansion, although it's been...
Also the main game, although it's been three years since it premiered. I know what is the most important thing for you, so of course, we will also have a meeting with the management board. We will have figures, we will have statistics, we will have results, and we will be discussing them during the next part of the meeting. Once again, thank you for being with us. Now, the CEO of CD Projekt, Adam Kiciński, the floor is y
ours. Thank you, Michał. Good afternoon, ladies and gentlemen. I'm so glad to be able to meet you in real life. This is the first real-life meeting for four years. Last time we had an investors' meeting was four years ago, apart from the general meetings. This was in 2019.
Yes, the first half year of 2019 was the last real live meeting. I'm so happy to see you here with us, and but also I would like to welcome those who are watching us or listening to us through the phone. Today's presentation is composed of a few presentations. We have three blocks. The first part, the first module, is about how we produced Phantom Liberty from the production point of view and how we produced the 2.0 patch, the 2.0 update, and then we will tell you about the game. There will be anecdotes, there will be fun facts, and to wrap up, we will have a business part, business module with me and three other colleagues from the management board. Let's start, ladies and gentlemen, and now I'm giving the floor to Maciej and Konrad.
The stage and the floor is yours.
Hello, my name is Maciej Włodarkiewicz, and I am the Executive Producer of Cyberpunk 2077 and of the expansion, Phantom Liberty. Konrad Grzegory is with me, who is responsible for the transformation in our company, and it is our pleasure to tackle a process that has been happening for two years, so the transformation of CD Projekt. I would like first to show you the effect of our work. This is a short clip about the expansion and about the 2.0 patch.
Being my favorite merc, welcome to Dogtown. There's a job, coordinates provided. You know what to do.
Get your ammo, assault rifles, tactical gear.
Thinking of buying some iron.
The logical choice.
Damn, clear view. Home stretch. Getting a ripper to overclock your chrome before the fight? Not a bad idea. Okay, I'm ready. Get this show on the road.
It's been over a week since the release of Phantom Liberty, and we have added some new functionalities. This was visible in the clip. Among others, we have a more dynamic fighting system. We also have a new system for cars and police and the progression, so getting new skills by the gamer. And also the AI of the opponents has been improved. This expansion, this update, was met with very positive feedback from gamers, and this is seen in the internet activity and the reviews and the ratings. Cyberpunk has now a historically high very positive score in on Steam, and this is a sign of quality of this game.
I'm convinced we would not be here if it weren't for the two years of work we've put in it to change the foundations, the base of the project. Let's first start by discussing how so far we produced games before the transformation. Before, we mainly worked in silos. It means that we had silo structures. We had, for instance, the art part and the programmers part, and they created puzzles which we would then link together to form the whole game. This is possible to work in this way. We've done three Witchers this way, and also the main game of Cyberpunk. This is a good method that we continue using if this is efficient and necessary. The silo structure also is connected to challenges.
The first of them is that the silos that work separately work separately, and we have to aggregate them at a late stage, and this means higher costs and also some production risks. You have to maintain visibility between the teams. This was a challenge, to have the full image of what is happening in all the teams. This was very difficult. That is why, considering our experience and all the things I've just mentioned, we have decided to initiate a transformation. Konrad is now going to describe what RED 2.0 is about. This is the transformation in our company.
We entered the transformation process knowing that those changes are necessary and inevitable.
Of course, it was a difficult process because at the same time we were working on, improving Cyberpunk 2077, and also we were planning at that time, where our work on Phantom Liberty. It became clear to us that a serious and effective transformation means incurring real costs, costs that you have to incur now, and that in the future will bear fruit in a better production capacity. So we decided to hire people experienced in the Agile methodology, and I was one of those people. I got hired by the project. So we also organized a series of workshops. We have learned to work internally using new methods. We have trained over 650 people, which is the majority of the team. And secondly, we knew, of course, that first this is going to mean a slowdown in our work.
Such a huge-scale transformation can be compared to, for instance, working out, starting working out in the gym. You go to the gym for the first time, and you don't see the outcome, the results, after the first week, the second week. You need patience. The results will become visible with time. But of course, there was no turnaround. There was no turning back, and to continue with our production plans, we needed a more effective way of acting and a better planned development process. We also needed the proper tools to manage this. Now we will go to the main pillars of our transformation. Red 2.0 is the answer to all those challenges. So we started the transformation after the premiere of Cyberpunk 2077, and Phantom Liberty was then realized based on our new approach to development and to work in general.
A change in the transformation is composed of a number of elements, of course, but I will tackle three of them, the main ones. The first one is that we need multidisciplinary, cross-functional teams that will cooperate with each other. This is. There is also the basic principle that the game must be playable at all times, and also transparency of the production process. This means visibility and communication, and these are the three basic elements. With that, we had better planning approaches, and every element will now be illustrated with examples. Maciej, over to you.
Before we go to the first pillar, the multidisciplinary teams, I have a question to you. Do you know what monster this is? What is this robot on the screen? For those who don't yet know play the game, please.
This is one of your opponents, a robot that you face in Phantom Liberty, and there is a set around the, around the opponent. The set is equally important as the opponent itself, himself. You- we need a lot of specialists. We need artists, we need programmers, we need people working on the mechanics of the world, and many, great many experts. So far, when working on a game, we had different teams, and they would work on some puzzle, some components. The mechanics would work apart, would be created apart, and then in a different team, the monster itself, and then the set, and we would put the three together to form a chapter of the game. This is how the chimera, the chimera sequence would come to be....
So how have we worked on this in a new approach in the multidisciplinary team? So as you see, we have the team working on this robot, the Chimera. And of course there were many more people. This is an example. We had art, artists and designers of the environment. So these are people who are responsible for the door being in the right place and designing the environment. Then mechanics designers. This allows us for the opponent to move in a good way, believable way. This is something that gives you a feeling of this being real. And then we also have the quality assurance engineer, who checks every day whether we fulfill the quality requirements.
So if we look at it from this perspective, that we have one team with all of experts and having one objective in mind, they make changes every day, dozens of changes and modifications, and they have to communicate better. This allows us to solve problems more quickly than in a silo structure. This is one of the many cross-functional teams that worked on 2.0. There were far more. There were many teams. We have bigger and smaller teams, so we try to scale them down because we want them to be more efficient. And we try to adapt the size of the team to the objective that they have to fulfill. Multidisciplinary teams were the beginning, but we also needed one more principle to implement and to test every day on a current basis.
This is the rule of a game that is always playable. This seems very trivial and obvious, but this is a key issue. All the changes we make in the game go back to the same place. They are tested. They are tested in the same place, not in a test environment, but in a given spot. Every... None of those changes should lead to a deterioration in the game, and if this happens, then it has to be fixed. This allowed us to play regularly on a current basis, react to all the problems, and the communication between the different experts was streamlined. Now, the next example, the ex-- again, the monster, the robot called Chimera that I mentioned. This is a prototype of the robot without the environment.
In the back you see the same robot, but in its environment. This is an iteration. It means it is a certain place, a certain moment in the production process. We had to change some elements to achieve the final effect that you can now enjoy. Among others, we had to change the environment, the number of doors, which walls are breakable, which aren't, the lighting, which place we should go to flee. The arms, the weapons, the weaponry of the robot, the armor, everything was modified. And then when we found the optimum quality, we stopped. We assumed we had reached our objective. Those changes were made every day on every platform, and we played all the time.
Now, if we were to go to the Polaris team in the building next door, we could see a workable game on all the platforms. But Polaris is at a different stage than Phantom Liberty. It's a very early pre-production. Nonetheless, it is playable. And now Konrad is going to tackle the next principle.
So a game that is always playable allows us to be more transparent in how we create the game. The third aspect we want to tell you about is full visibility and improved communication. Once again, we see the team, multidisciplinary team with three levels. The first level is the level of teams, also multidisciplinary teams. This has already been explained by Maciej. In every team, every developer, irrespective of his or her specialization, sees the part of the game that the whole team works on.
To a large degree, thanks to the visibility and transparency, we shorten the time for verification, for checks, for adjustments of the work of every developer. This means that you have to wait a shorter time for playable incremental part, increment of your work. So another very interesting level is the level in between the teams, so cooperation between the different teams. We give them some time, we give them some space, so that before they start a new iteration of their work, they find, they mark, and they solve the main relations, the main interrelations.
... We had to plan altogether Phantom Liberty. The most intense part of the project was a stage when we had over 300 people working on it, and this is a visualization of our teams in one place. This is a dependency cube or a dependency matrix. We have 625 possible interactions between the teams, and the colors and the visualization tools allow us to spot the places where the different teams need support, help, or decisions, where decisions must be made to impact the whole game. A good example of such a connection that was detected at an early stage and that could lead to problems later on is the connection between two teams, where one was working on the main storyline, the main mission, the main quest, and the other was working on the open world.
Those of you who have played Phantom Liberty, we recommend all of you to do that together with Maciej. You know that one of the main storylines involves a car chase in Night City, the Dogtown suburb. One of the team's plans an emotionally coherent connection of this quest with the whole storyline, while another team also, meaning very well, planned a credible, rich world by making Dogtown, with all its characteristic atmosphere, host a block post in the middle of the suburb with the barricade involving an overturned truck. If those two teams don't work together, we will block the player, and then the teams will have to spend additional time we have not forecasted for, to make the gameplay coherent with the whole storyline.
Now, if we multiply this situation by the numbers of teams and their potential interactions, we will see the scale of facilitations that we've achieved, as well as the number of potential failures avoided. Now, the third level, because we're moving across these three levels, is increasing game development transparency on the corporate level. This is through RED Play events, where members of all teams were encouraged to play the game and share their feedback. We set up functional Phantom Liberty stands, with PC and console versions in our canteens, in our conference rooms, and we encouraged our team members to play Phantom Liberty, regardless of whether the team members were involved in the Phantom Liberty development teams or other functional teams.
This way, they got to know the product several months ahead, and we wanted them to spend as much time as possible in that world, and share their feedback with the developers working on Phantom Liberty. Thanks to these company-wide initiatives, the developers got much broader feedback, and comms and marketing teams were able to use materials sourced directly from the game. This is very important from the job optimization POV. So these were the three levels, and now Maciej will summarize the results of all these changes. Indeed, the changes that we've introduced had a very specific purpose in mind. The most measurable result is us being proud with what we output with this extension, but also reviews by players and critics. We are very happy with that.
All of us in the studio are deeply convinced that both, Cyberpunk 2077 and Phantom Liberty will be on the must-play lists. Implementing these three key rules, that is multidisciplinary teams, always playable game, and increased transparency, supported by new organizational and planning tools as well as visualization tools, helped us publish an extension and a massive extension pack, upgrade pack, at a quality that we're proud with almost simultaneously. When developing Cyberpunk 2077 and Phantom Liberty, we also grew our capabilities related to more titles to be published in the future. This will be discussed by our CEO in the third block. As we improved our gameplay skills working on this extension and the 2.0 version, here we can see cumulative, results of reviews on all Metacritic platforms, confirming the result level that we're presenting to you.
This is not the end, of course, for CD Projekt Red. Polaris is already using these... the methodologies that we've implemented when working on Phantom Liberty, as well as the 2.0 pack. We're fine-tuning them to make them match our needs, as we are deeply convinced that working on the organization, just like working on the game, is a continuous iteration. Thanks so much.
Thank you. I'm responsible for publishing on a daily basis, so this last transparency level was particularly valuable to me, as at comms, we knew very well what we were going to try and narrate after the game launches. Before I ask you out for a break, feel free to ask questions via email or here in the room.
If you should have any questions whatsoever related to the production process, and the ways these changes look in practice, how they iterate, and how we adapted our teams to work on this game, this is the right time to ask these very questions.
H i, Wojciech Knap, Generali OFE. Do all of these efforts somehow translate into the output times, and will they cut the development times, the lead times, shorter for new ti tles?
Well, the timing is not always dependent on these changes, so because we are taking on more and more ambitious projects, but what we wanted to get is transparency of these changes, too, to make our products more predictable and to release them according to our plans. Whether this will transfer into shorter lead times in the future, well, that depends on the ambition level, the scope of these games, and their complexities.
Are there any more questions?
Hi, Tomasz Olek. Have you encountered any issues with this transformation process? We heard just about the upsides, but were there any difficulties?
J ust like I discussed the gym metaphor at the start, this required a lot of effort on the part of mostly everyone. Each transformation has its challenges, but transformation outputs a product it supports, and I believe Phantom Liberty is the type of product that is capable of defending itself. So yes, we did, like everybody does. If there are no more questions, feel free to take the break, and we'd like to ask you not to bring any beverages or food here inside this room. That's what they are asking for, because, well, we will be the ones to blame if you do.
So feel free to get out to the space you already visited, and we're meeting back here at three sharp. My colleagues will then be able to present Dogtown to you, if you haven't seen it yet, and what the gameplay experience really looks like with Phantom Liberty. Thank you.
I hope everyone's back, and I do hope that this presentation by Magic and Konrad has been enjoyable for you, as we really wanted to show how much we've changed at our company, at our studio, how our attitudes have changed. When producing this title, all of us, the developers here, really wanted the product to show how it made sense to change it all, and we hope that's the case. If you saw the product or if you read the reviews, you know there are some very characteristic features out there.
On one hand, it's the plot narrated by Phantom Liberty, on the other, it's the art and design component. It's very unusual, and many people are pointing out how beautiful this game is. And the third one is the gameplay, the mechanics that allow the players to interact with the opponents and all other parts of the world presented by the game. That's what we'd like to describe to you. Two of our colleagues will narrate it from the stage, while Julia is going to provide a live demonstration on the screen. So people responsible for the plot, for the gameplay, will introduce themselves. Please come up on the stage, and Julia is out there in the back...
Welcome, ladies and gentlemen. Welcome to the presentation of Phantom Liberty.
We have the gameplay designer, Julia Magdy, in the back of the room at the console, and with me here, Wiktoria Stachowska , Senior Environment Art Coordinator, a person responsible for the team that designed our city.
Hi, welcome.
Paweł Sasko, Quest Director, responsible for the quest team, the open world team, and the scenes team. Now, we're going to show you a section of Phantom Liberty, the expansion pack for Cyberpunk 2077. This story section is about one hour into the game. We're entering the black market. We're in a stadium which now serves as a techno market, a place where you can buy anything, including items that are not available in Night City. It's a local place where we are able to buy electronic scrap as well as luxurious goods that fell off a truck. We have advanced weapons, we have cyber implants. We can see what Harold deals in here.
Never seen anything like that in a non-Maelstrom.
You mean this? Ain't seen nothing yet. Check this out. Well, this here,
What happened? Some kind of accident?
There's a bunch of theories: cyber psychosis, childhood accident, mind blast, body dysmorphia. Take your pick.
Which one's the real one?
Whichever one's gonna land me a sale. Speaking of, how can I help you?
Who the hell cares?
Preen collection. Ain't scared something will go off on its own?
I'm jacked into all of them. Feedback loop, cohesive connections, and all that. Chill.
All of these are your peripheries. Not afraid of an overload?
Me? Afraid? No. No, no way. Maybe.
We got small caliber.
Anywho, don't want the gear to get cold-
As you can see, Harold is spot on the Dogtown vibe.
This dude named Rick owned it.
Where'd you get that piece?
Hey, a good dealer never reveals their sources. I'm all about the lost, the found, and the kicking. Make all your lethal dreams come true.
Okay, ladies and gentlemen, what Julia is showing to you now is Harold's store. Here, the player can buy any weapon they want, including iconic pieces that have these golden backgrounds and very characteristic stats and gameplay features. What's interesting is that even if you miss an iconic weapon elsewhere, you will be able to find it here in the store, and in your user interface, you can look at all the modifications that we introduced for patch 2.0. This has been a major effort on the part of the studio as such. Here you can see the weapon stats as displayed through user's interface, which is much clearer to the players. Julia is now selecting something to help her along.
Accessories and supplies. All including-
What's also important in Dogtown is the leader, Kurt Hansen, a businessman, a politician, a former military. Let's listen to him now.
Gang wars, not in Dogtown. Taxes, who needs them? In Dogtown, I keep your business safe, as long as you abide by my rules. Sound fair to you? I thought so. Good.
Kurt Hansen is one of the key characters in Phantom Liberty. That's a character a player will be able to get to know and understand better. They'll be able to get to know what's important to him. He's a leader of Barghest, a police-like unit that keeps control over Dogtown.
Here you can see two young business people, fledgling business people, who have lent their faces and voices for their cameo appearances in the game. Now moving through the stadium, it makes sense to showcase the players of a local sports team. This reminds us what this place was supposed to be and how starkly it contrasts with what it is now, as Dogtown is not playing its intended function these days. It's a location... Oh, I forgot what I wanted to say.
It's a location that is used for the transfer and shipping of weapons, and Kurt Hansen runs his business out of here. So Mi is our net runner. She's a digital visualization here. Let's listen to her.
... Relic will finish me, sooner rather than later.
But you're here, looking for a means to survive, still fighting. Think you'd do anything for another chance?
Can't deny it.
... Chin up. We're in this together.
There is that.
As you can see, Dogtown is different than the locations from the main game. It made a lot of sense for us to differentiate these two and show you how this area differs. In the middle, we can see aerostat. It's a typical part of Cyberpunk lore. It's an AV, nuclear-powered AV, a flying entity, and we saw these thick cables that Dogtown inhabitants use to steal electricity. So Dogtown actually provides power to the whole stadium area.
All right.
It's also a very densely populated area. Now we're heading towards a space where we'll be able to see more of the open world. In and out of itself, it's a part of Night City, and Pacifica in particular, but in terms of its identity and culture, it's separate. It's a ghetto, so that outsiders from this community are not really able to enter. You need to be involved in some illegal business to be able to get involved here, and it's very dense, very coherent, but it's also split into five distinct sub-districts. Each of them is different. Its identities, functions, and inhabitants are different. Here we can see this aerostat, nuclear-powered aerostat, as well as the cables that provide that supply power to various worlds in this city.
What now?
Try and restart the generator.
Here we can see one of the minor challenges. It turns out that the elevator we were supposed to use does not work. I'm not going to tell you more because it's all related to the plot line and the content of this expansion. If you played it, you know what I mean.
FYI, we're about to cross into Night City airspace.
Might be a bit of a shock. Braced for it and whatever comes next.
In spite of the fact that Dogtown has five sub-districts, and every sub-district has its face, there is one layer that brings them together. These are traces of the unification war, an armed conflict that ended a few years ago, and all those functions, all those elements are then covered by the ruins, by the debris, and it makes this place unique and dangerous. We are now climbing up at the top of the stadium that is the heart of Dogtown, and we are supposed to meet some netrunner.
Tension's rising, unsurprisingly. See that? It's us, Space Force One. We're descending in for a rough...
What? What's going on? What the hell? Songbird!
V, the president, you have to-
Songbird. Okay, we got this. Save the president.
Here you can see the whole of Dogtown from this viewpoint. Welcome to Phantom Liberty. This is an overview of the new district. You see it, you see the skyline, you see the horizon. You have a general overview of the place. The first spot you witness in the open world is Petrochem Stadium . This is the heart of Dogtown, right in the middle. It was designed before the unification war as a luxurious district with casinos, with luxurious hotels and manors, and this was meant to have fun and spend your, and spend your money. You have exuberant, colorful buildings and facades that are supposed to encourage you to spend your time and spend your money. In this whole cacophony now, you see the layers, so the past luxury and the current ruins and debris now, when Kurt has overtaken the city.
Missile Songbird? They just shot you clean out of the sky. No way!
I had no idea Hansen.
You need to hurry.
What then? Got a plan?
Find Myers. Get her to Liz Kress Street. It'll be the safest spot in Dogtown right now.
Right.
I'll be in touch.
This is a staged and scripted part of the gameplay, so we know that the president crashed somewhere in Dogtown. Julia is driving a motorcycle. There are a number of ramps that you can use to jump. When designing those levels, we try to give to our gamers a great many possibilities of playing around and having fun. We are now in a place where we have the first squad of Vargas. This is the militia that I mentioned under the leadership of Kurt Hansen. Julia is preparing now to face the opponents. Phantom Liberty is an expansion. It's a spy thriller, so she has a muffled weapon and with a silencer. We are a netrunner, so it's a kind of cyberpunk hacker. She will be using the netrunner skills to face this gameplay challenge.
Yeah, yeah, battery's fine. Something else bought. What? If I knew, we wouldn't be here. Well, that's that.
What we see here is that Julia used a Quick hack. She tagged the opponents. She has tagged them, so she sees their silhouettes through behind the different parts of the set, and she can basically follow them on site and stay hidden.
Just a matter of time now.
The changes that you see here, some of the modifications we've included in the 2.0 patch, that are also now part of the main game of Cyberpunk 2077, among others, the Netrunner build. All those parts now, some of them are part of the native elements of Phantom Liberty. Julia now has managed to kill the opponent and throw his body into a container. Julia is using now the possibility of distracting the opponent. He went towards one of the machines to check what is happening with the machine, because there was some kind of disturbance. Of course, the opponent then got distracted, and Julia, Julia could easily get rid of him.
All the encounters, all the different challenges in Cyberpunk and Phantom Liberty are designed in such a way that will allow our gamers to cope with them in different ways. Having different types of characters, different builds, they can experience the game in different ways and go through the game in different ways. They can-- You can play Cyberpunk and Phantom Liberty in different ways. It's similar to the approach to Witcher 3, where you also had different ways of playing the game. Julia managed now to go through the most dangerous part of the encounter. We might as well be a shooter and shoot around if we had a different character class. Now we are climbing up a crane, and this is going to allow us to see the exact site where the president's plane crashed.
Hands of people are there. Seems they've been given a job to finish.
How many are people there?
There were 11 on board, counting myself and Wozlan. How many still alive? No idea. Must be some way I could... Wait, I got it. The crane arm. Hop on. I think I can boot it up. Not a second to spare now.
It turned out that our netrunner was able to move the crane's arm to reach the crash site and the president. Now let's look at the skill tree. Some changes were introduced into Cyberpunk 2077, the main game and the expansion. These are new skill trees from scratch with new user interface. This allows you to create different types of builds, so character class, therefore impacting your gameplay. This is the relic tree, a special chip you have in your head as the main character. Johnny Silverhand also has one, played by Keanu Reeves in the main game. Now she is considering on what to spend the points. Jailbreak is something that allows you to interact with the cyberware, so those technological add-ons that you can have in your body as the main character of the game. Now preparing your weapon.
Okay, we're ready to fight.
Across the roof, right straight ahead.
I'm going to tell you about how we built this location. This is very specific. This is a crash site. This is the place where the plane crashed, and we wanted to stress in this scene that the whole building has been ruined. Dogtown, Dogtown is not finished. A lot is under construction, but we wanted to show that the s- that the aircraft crashing led to a lot of destruction. It's very vertical. There are many planes to, many levels to explore. You can look up, you can look down. You have to jump up or jump down. You see a crane collapsing right now. These are very dynamic objects that allow us to maintain the suspense. This is also achieved through special effects, the fire, the dust, and the yellow light emitted by the fire.
A great many opponents, humanoids that support us, drones on our side, and the opponents. This is very dynamic. This is vibrant, and we want the player to be engaged, and we want suspense to be maintained at the highest level. If you go straight, you see, a red glow. So red is a color we use a lot because it's an... It should alarm you. It's an alerting hue. You have the flares, you have the light from the fire, explosions, and finally, you reach the main crash site. You see the wreck of the president's plane. Victoria told us from an artist's point of view, but let's play together, and let's discuss the technology.
What does redENGINE allow us to do, and cooperation with NVIDIA and all those technological add-ons we've added to this game, which we consider the best game in the market right now? What Julia has just done, she used quick hacks in a row, so one can trigger the other. So we can combine them, you creating combos. A Netrunner player can have a lot of fun with this. This is something that comes from the 2.0 patch to the main game and to Phantom Liberty.
Ah! Heavy artillery. Ah.
As you see, Julia is exterminating everyone. There's no mercy here.
Better cooperate.
I think it's time for us to meet the president. We don't know what happened.
Whole lot of wrecked aircraft.
Anyone alive?
Nobody jumping out to greet me.
Are we too late?
Pretty quiet in here, like tomb quiet.
If that's true, then we need to be sure. Need confirmation she's dead. Keep moving back. You'll see a safe room. I'll pop the release on the door. Not one move. Who are you?
As you see, the president can take care of-
Relax. Someone's here.
You are?
Stand her ground.
It's me.
Apologies. I had to be sure it was really you.
Right. But still. Ah!
Good. Okay, so we'll end this part of our demonstration, and we'll jump to another part of the game, and with Victoria, we are going to focus on the technology, the technology behind Cyberpunk, the main game, and Phantom Liberty. What you're about to see is a transition. I mean, we will go through Dogtown. We will have a tour. We will tell you and show you two components of the technology. One of them is path tracing, allowing you to render physically the lights in our game, and then we will have a technology of reconstruction that allows us to reconstruct the image and make it sharper, and therefore, more attractive in the game. This is something we'll try to show you and to describe to you. This is a unique technology. No other project worldwide has it.
We have it because we cooperated with NVIDIA, and in a close cooperation. Cyberpunk 2077, it has no loading screens. It was a great showcase. It was a very nice way of showcasing this technology. Okay, let's start by one of the most beautiful place in Dogtown. This is the neon wall. We have a lot of light sources. We have static source, dynamic source, we have lights from the towers, we have billboards, we have glitches, we have blinking lights, some clips are screened. Also holographic lights. All of that, that has to be composed into one whole to give a realistic and attractive way. So this new technology allows us to make it happen. We have overlapping lights. We also see the effects on metal surfaces, on wet surfaces. You see the barriers, see the ramps? Yes.
This is very realistic. The path tracing technology we have in this game is a milestone. This is really disruptive technology. This is also offered in a wide scale to the, to the gamers. Cyberpunk 2077 and Phantom Liberty are a smooth game where there are no loading screens. The only place you have to stop is when you reload, because you're dead. In the meantime, everything loads as we go. It's streamlined, it's smooth. What you see here is a great example of a wet surface. It's very difficult to show something that is wet. This is how it looks in Phantom Liberty and Cyberpunk. It's very realistic. The lights shimmer, depending on your position, how you look at them. It's interesting. You know, we saw it in the stadium, and here we see how the lights are mixed up.
Some pink, some green, mixed together, some shades of blue. The reflections, the lights are very realistic, and they give us a very realistic whole. The game industry, so far, was not able to achieve such effects. Cyberpunk path tracing, actually here is one of the technological milestones we have achieved. We wanted to show you the lights and the surfaces in terms of the cars. This is Quadra Vigilante, one of the cars we have in Cyberpunk, a new one. You see the reflection of the light, depending on where we are, and when we drive, you see that the light and the reflection are changing. A very nice element is the radio.
When we were working on Phantom Liberty, we wanted to add to 2.03 new radio station, Growl FM, with music that was written by our fans, by the gamers. Dark Star, the next one, has completely new music, and the last one, probably the most interesting, is Impulse. We have a DJ set that was created for Idris Elba. Some of the pieces have been recorded by him, and some have been mixed, and this is available to our gamers to enjoy in the game. Now we're driving the main Dogtown, our communication route. We call it the Dogstrip, as a reference to the main Las Vegas communication path, and we have both local lights and neon walls.
Thanks to this technology, we are able to show how these lights interact together, how one light source impacts others, how they take over the hues, and what these effects look like in real life. Now, if you move to the right, you can see how the neons reflect off water. Water is very fluid. It changes its shape very readily, but thanks to this reconstruction function, we're able to have a very sharp image, meaning we can read the characters of the neon as they are reshaped off the water's surface. This gives us very realistic effects, just as if we were able to experience if we were there physically. Now we're going towards Longshore Stacks. It's a residential Dogtown area, inhabited by the working class. People built their towns on the remains of unfinished construction site.
The inhabitants make their dwellings out of construction containers and other construction site accessories that were left over. And then today, in the Dogtown present, it's a highly functional, self-contained, and self-regulated favela, with the inhabitants shaping their homes very organically. We heard from a British architect that said, "The difference between a house that is a prison and a shed that liberates you," and that's what's characteristic for this very shanty town. We're getting closer and closer to the marketplace, the place where people gather, chat, and spend their spare time. What's also characteristic is the tree in the middle. It's being kept alive by the local inhabitants.
... They post pictures of their missing loved ones around it, and it's like a cultural axis of the whole community living here. Coming back to the tech, as the creators, we provide our players with an opportunity to watch the town 24/7 with various weather patterns. If we mix it all together, we have almost unlimited number of options. We can skip time and see what it all looks like at a different time of the day here. Right. The light is very realistic. That's the most important characteristic of this path tracing technology. The light that Victoria discussed looks just as if it would have looked like in real life. Sometimes if we take screenshots, it's difficult to differentiate them from realistic photos. That would be it in terms of presenting the technology. We showed you some excerpts from the Phantom Liberty.
We showed you path tracing, the reconstruction technology, the DLSS 3.5, and now we're ready to answer questions, if you should have any, in the room or online .
Piotr Poniatowski: What's the biggest bottleneck for your technology? Is this the hard drives, the GPUs, or any other components? This... By this technology, do you mean DLSS 3.5 or path tracing? DLSS.
Oh, that's a very deep and complex question. I'm not the best person to answer, but for DLSS 3.5, that's deep learning super sampling technology, meaning we develop a smaller image and then scale it up using two solutions. One of these is frame generation, a technology that lets us generate an image and get more frames per second. You saw that in NVIDIA materials that we showed you.
We're using the increase in the number of frames is really rapid. The same is true for reconstruction, but as far as I know, both the CPU and GPU load in the case of our game is very uniform indeed. When talking about the DLSS 3.5, though, it's a technology that was developed for 40-plus graphics cards by NVIDIA, meaning weaker tech is not really able to use its full potential. Both GPU and CPU load is very high, but I'm not really competent to go deeper into that. I hope this was a helpful answer anyway. Anything else? We can discuss the game if you want.
Another tech question. In terms of production, do the present generation consoles, that is PS5 and Xbox Series X, act as a block as to what you'd like to show?
They are technologically inferior to the present day's PCs. R&D, we saw 4090 or high-end GPU renders.
So wouldn't the present-day consoles be a limiting factor to what you're already capable of?
Well, there are several aspects. As you can see, we released the Phantom Liberty and CP 2077. We launched it on various platforms. On PC, the game uses all state-of-the-art technologies. We're squeezing every last fraction out of the market-available technologies, and hardly anyone does that as compared to the games that we do. It's difficult to discuss stumbling blocks then. We work with the technologies that are available and do our best to squeeze every last drop, be it from consoles or from PCs. If anything new comes on the market, we will again do our best to deliver products that use these techno
logies.
It's very difficult to squeeze out more out of the existing equipment than we did.
Another question about your future project. Do you believe you would be able to squeeze out more out of Unreal Engine 5 than from out of REDengine?
It's a very complex question, and a very multifaceted one again. First thing, the projects we're going to release on Unreal are a matter of the future. We're not discussing them yet, and the technologies are progressing. What we can do in Cyberpunk now was not possible several years ago, so it's only natural that we'll do our best to keep our projects as the high-end ones.
When you see a CD Projekt game screenshot, you know this is something we developed. Are we going to be able to squeeze out more?
Difficult to say.
If you asked me two years ago about what we'd be able to achieve in Cyberpunk in 2023, I wouldn't have been able to answer, even though it took us quite long to develop this technology... and I guess this is the best answer I can give right now. We will do whatever is possible with a given technology and in a given timeframe. These are going to be best looking games on the market. That's the objective that we're not shying away from, and that today's ambitions will be standard ones soon, and we are happy being able to move these goalposts ahead. Now, a question in the context of quest design. I wanted to ask you about language models and their role in interactivity for the user, as well as their role in game development and quest develo pment.
Your main advantage used to be deep stories, unique stories. But what Ubisoft announced recently makes us believe that the quest generation, in their case, is going to use these generative mod models.
Are you going to follow in their path, or are you still going to focus on human-driven content generation?
Well, first of all, we aim to use any new technology out there. We explore it. Even if we don't mention it outright, we explore all those innovations, and that's also the case with what you mentioned. We're seeking ways to use those methods to deliver best games ever.
This never changes, but what's essential to us is that the games that we develop are ones where you can sense that the plots, the quests, and the characters were developed by designers who put in a lot of care and effort to generate that content and fine-tune it. Are the new language models and AI-driven ones going to enable us to do just that? If so, we're going to use them. If not, we are not. That's the answer I can give you right now. Throughout the industry, we are in this deep reflection mode and consideration of what is possible to output best games ever. That's always the goal.
If they can be used, we will find these uses for them, but to what extent? Time will tell. Another question about Orion. Can you tell us something about that?
We can read a lot on Twitter, that's why I'm asking you that question. Well, I'm not sure what I could tell you. I know what I can't tell you, and not much is left. This is our next project. It is. It's going to be developed by our U.S. studio branch. That's where we're relocating to with key people who have worked on Patch 2.0, as well as Phantom Liberty, Igor Sarzyński, me, our narrative director, and some other people who are responsible for the main verticals in Cyberpunk 2077 and Phantom Liberty. But we're on this organization and recruitment stage right now, and there's not much more I can tell you. There are talks underway, there are works underway, but it's all ah ead of us.
An unrelated question maybe, not a very technological one, but sometime back you took a decision to make Cyberpunk a first-person game. Some players, however, would love to be able to switch to a third-person perspective. I know it's not in line with your, concept, but then, do you have any regrets about the decisions you've taken, or are you perhaps considering providing that third-person option for Orion, being able to toggle between the perspectives?
That's a great question. But there are no regrets on our part. I was one of the people who started developing the first prototypes of the scene system for Cyberpunk, using the, Witcher technology. What we wanted, though, was for Cyberpunk to have its own identity and to be noticeable as this different thing.
These days, it's YouTube, Twitch, and screenshots that sell games, and this is a way one can use to show that identity and individuality to players. First-person perspective helped Cyberpunk develop this identity a lot. We put in a lot of work in preparing this body presence, so that it would shine through this first-person perspective. You can see the outstretched hand or, or outstretched limbs, when you're sitting in a car seat, for instance. That was not what your question was about, was it? I wanted to say, though, that the first-person perspective is the main characteristics for Cyberpunk and its perception by the players, too. It's also noticeably different from The Witcher... and this helped us craft the product identity as such. This is also what Adam Badowski told us a long time ago when we were discussing the first-person perspective in Cyberpunk.
As creatives, we also need to shift the mindsets, not to stay in a rut. I don't want to give you examples, but you know, there are many companies or IPs out there that are a bit like, line production or copy-paste production. We didn't want that to happen to us. We have put three games in The Witcher series, and we want to do something different. So there are no regrets. It was a very successful decision. We saw some of first-person perspective in Cyberpunk. It's even more visible in Phantom Liberty. Many journalists also noticed how characteristic it is, as contrasted with other products out there on the market. I'm not going to quote any titles, but for Orion, we're yet to see. Thank you.
Now, when asking about the future, Orion, and the competencies that we acquired when working on this expansion pack, we're going to discuss it later. Let's meet back here in 15 minutes for you to listen to a presentation on these very matters that are the most interesting to you. That is going to be a session with the board members in 15 minutes, and now let's take a coffee break. Thank you.
... Wykazali się Państwo cierpliwością, I hope that- you were patient, but I think it was worth it. On the one hand, we wanted to show you the fruit of our work for the last two years, and I hope this was interesting, this was certainly relevant. Now, I've heard that now from your perspective, comes the East. Statistics, figures. Of course, I wouldn't call them simply figures. They are indeed relevant metrics. Now comes the time for the last time, for the last part of the presentation, probably the most important for you, a meeting with the management, management board, a recap and a summary of the recent months and years. I give the floor to Mr. Kiciński, the CEO.
[Foreign language]
[Foreign language]
[Foreign language]
I will be sharing the stage with Piotr Nielubowicz-
Adam-
[Foreign language]
[Foreign language]
A long road led-
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To today, to the time we are... and the place we are here. Since the premiere in December 2020, we have been updating and honing the game. There were two breakthrough updates. The one was 1.5.
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The first update-
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That was issued with-
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The PlayStation 5 version and Xbox S, X
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This was in February 2022.
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Then this September last year, Edgerunners update. This is the 1.6 update.
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So we-
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Linked this with the premiere of the Edgerunners series on Netflix. Both updates-
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were a huge success in supporting sales, especially the second one.
[Foreign laguage]
We've seen a very-
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Visible upsurge in sales.
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But this wasn't the end. Here comes update 2.0, that brings the game to a new level.
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It means that a lot of gamers are coming back to the game, but we also are recruiting new gamers. We are very proud of our work, and I would like to thank our team.
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This was an incredible, incredible piece of work. I mean, the game is phenomenal. We should all be very proud of it. This translates into sales. The main game is selling, it's selling great.
[Foreign language]
Oh, sorry, not yet!
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But this translates also into rating.
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Steam is a PC platform, and ratings on Steam.
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are credible, because this is rated by the people who really bought the game. The level of recommendations of the game is 9 out of 10. The level is 87% for the last 30 days.
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This means that will translate into sales. A new milestone has been reached, 25 million copies of Cyberpunk 2077. The phenomenal Witcher 3 achieved a similar level in 4.5, in four and a half years, and here, a little bit over 2 years. So we are selling far faster than we were selling The Witcher game.
[Foreign language]
Phantom Liberty is the new update and the new expansion we've been talking about. It has been received very well. A great, great reaction. You see the media opinion, opinions on the slide. But we gave to the media the game in a version for every platform, so that every journalist would be able to play Phantom Liberty on any platform. And this led to very nice, great, a great reception, great reaction, very massive.
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Of course, expansions don't gather that much attention as the main game. So the Phantom Liberty is an expansion, but this is a huge expansion. It's equivalent to a game in itself. It's similar in size to a standalone game.
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The average rating on Metacritic, depending on the platform, is around 90. So this is a very good result.
[Foreign language]
I have problems with my mic.
[Foreign language]
Now, the gamers rated Phantom, Phantom Liberty, so 90% of the gamers on Steam recommend Cyberpunk. We are very proud of it, and I'm handing it to Piotr now. Handing it over to Piotr.
[Foreign language]
Good aftrnoon, ladies and gentlemen. Can you hear me?
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It is my great pleasure to tell you more about the figures.
[Foreign language]
We have a set of statistics fresh from the oven about Cyberpunk. I want to ask you for your indulgence. Please, don't... I hope you won't mind that I will be looking at my notes, because I don't want to be, make any mistakes as to the figures. The most important piece of information you've been waiting for is sales. Sales for the first week until the 3rd of October is 3 million copies. To contextualize this, we estimated how many gamers have now the game, main game on PC or on the new consoles, all the platforms that allow you to play it. It's 20 million. 20 million gamers who either have the main game or have updated the old gen to new gen version. So 15% of all the gamers within one week bought also the expansion.
This is a phenomenal, a great result. This is just the beginning. Sales keep on climbing. What is the regional structure for sales? We have North America, with almost 36% of sales. Number two, 1% lower, Europe. Third ranked, Asia, a solid result of 23%. On this slide, you see the division into platforms, where Phantom Liberty was bought. Of course, PC is the majority, as usually, it's two-thirds of the sales. Then we have PS and 20%, and Xbox, 13%. But I'm especially proud of one thing here, it's the result on GOG. GOG was responsible for 14% of the whole, PC sales, so 10% of the general sales.
This means that GOG is the fourth platform in the ranking list in reaching the market, and this is similar to huge platforms like Xbox or PlayStation. A lot of gamers trusted us enough to buy Cyberpunk from us, and then also Phantom Liberty. To sum up the scale of the project, at its peak, there were 360 developers working on the project, and during the whole cycle, there were 10 times more people involved in the project. This is a huge project, and this has led to a great expansion, and the budget was PLN 275 million. This is the budget that we assess. Currently, as of now, we are still booking costs, we are still closing the results within the third quarter. The final data will be available soon.
This is only an estimate, an initial estimate. We also spent on the information and marketing campaign, PLN 95 million is the cost. As you know, the campaign was, in majority done by us using, digital media. The campaign for the expansion also led to more interest in the main game. In the recent weeks, we've seen a surge in sales of Cyberpunk itself, and I believe that just like it was in the case of Witcher, the main game and the expansion will become long sellers for many years to come. Let me touch upon one technical issue. The way in which we will be settling in time, booking in time, the expenditures on Cyberpunk, around PLN 275 million. After analysis of the situation, we came to the conclusion that Phantom Liberty and the future sales are intrinsically linked to the main
game.
Therefore, we would like to have them booked together. Therefore, we will sum up the value of the expenditures to produce Cyberpunk with the expenditures for the next-gen consoles, which was around PLN 178 million. To this value, we will add the PLN 275 million to produce the Phantom Liberty, which gives us around PLN 450 million. This is going to be depreciated from the Q3 on. This will be depreciating, depreciated according to sales estimate in Q3, and we would like to depreciate the first 20% of these expenditures, of the PLN 450 million, and then in Q4, the next 20%. The rest will be settled in time within five years in a decreasing matter, year on year. This is all I wanted to share with you today.
We will have a full summary of the results after the few days after the premiere of Phantom Liberty. We will have, at the end of November, a Q3 summary conference, and now I'm giving the floor to Mr. Kiciński, Adam Kiciński.
Hello. During my part, I will draw your attention to what we learned while designing Phantom Liberty. That's why I have decided to screen the game at the same time. I want to tell you about the premiere of Phantom Liberty, and about the 2.0 update that premiered at the same time. But in the context of the whole road that leads from 2020 to today, I wanted to say that the 2.0 update is not the most recent, because today, around 12 noon, we have 2.0.1 that was published.
As you've probably heard during the first part of today's presentation, during this meeting, after the premiere of the main game of Cyberpunk 2077, we drastically changed our approach to production and to development of our product. Phantom Liberty is the first game produced in the new methodology. I know it's an expansion, but it's a huge expansion, so like we've already said, this is comparable to a standalone game. This has given us a more holistic approach to production and to design. We are more aware of where we are at a given point, and the most tangible effect and a sign of success is that the game was fully playable months before the premiere. What were the consequences?
Well, first of all, we could focus on polishing some elements of the game, removing critical bugs, critical errors, and also on coordinating the work of different teams. At the end of the work, there's post-production, and one of the stages of post-production is something that starts just after finishing the plot. It's localization. As you know, the game is available in 19 languages, of which we have 10 languages with full casts of actors with voice-over, and this is something that happens at the end of the creation of the game. So when this situation in production is more stable, then of course, the quality of the translation is higher. Of course, post-production never has enough time. They always have to work in a rush.
And then we also have cooperation with the production teams, the teams that worked on the game, and their cooperation with sales and promotion. Like I said, we were very aware of the high quality of the product we were about to deliver, and that gamers would get. Let me focus on what we learned in the process, but let's go back to The Witcher first. As we developed The Witcher's IP, we achieved. We reached a number of milestones in the studio. First of all, we defined what a modern RPG is, because this is the core business of our company. During the premiere, and while working on Wild Hunt, we linked two things, two aspects of the game that theoretically could not be linked, or one might think so.
So the deep narration and storytelling, and an open world, it was, it was far from being easy and banal. Maybe I'm not being modest, but we have set a high bar, a standard, and we also have a very nice visual layout, a very nice visual design, and Paweł mentioned it. As you know, open world games are extremely complex. They require modern technological solutions. I'm going to go back to that when I'm going to speak about our cooperation with NVIDIA. When working on Phantom Liberty, we came very close to dynamic games of the FPP and first-person shooter games. Of course, we are specialized in storytelling games, in RPGs, but we also had to learn a lot about new solutions. We had to gain new skills, especially around gameplay. Gameplay is how the player interacts with various game elements and what drives their enjoyment.
While working on this release, we had to come up with and develop many complex gameplay mechanisms. First of all, developing the city vertically and horizontally, a perpetually active one, simulating traffic for a city that never sleeps, as well as many aspects related to UX design. That is, most of the equipment we have in the games, such as vehicles or weapons, have-
... almost real functionalities. What's also essential to me is that in the first-person mode, designing players' interactions with the game requires millisecond range of precision. That's also a lot of knowledge that we've acquired. But generally speaking, I'm convinced that when one develops immersive role-playing games, the experience transfers very well to any genre. When working on Phantom Liberty, we've cooperated with the largest market technology providers. Paweł has talked a lot about our cooperation with NVIDIA, but actually, what we came up with was a rendering model that is unique. Many industry experts believe Phantom Liberty to be the best-looking and the most technologically complex title out there on the market right now.
We set a new benchmark for the industry, and when talking about technology, over the course of the transformation, we decided to change the engine to Unreal Engine 5, and with all thoughts, I want to stress this was not the least path of resistance. This was a consequence of us wishing to work with Epic engineers to adjust their engine to meet our needs. We are a company that has creativity at its core, not just developing arts, locations, and quests, but also as our attitude to development, tools and processes, as well as technological solutions accompanying all that.
We believe that at the core of this engine, we have so many interesting solutions that would have taken years for us to implement, and we want to build on that to add our innovative solutions on top of that engine, while maintaining various types of insider knowledge that we keep at our studio. The next thing that we developed was consolidating a team aimed to collect telemetric data and analyze it. In the future, this will help us take more conscious game design and feature design choices. Another essential matter for us is that our games and our worlds and their impact on the popular culture. Michał Nowakowski is going to tell you more about that later, but what I wanted to signal is that our games are not our ultimate purpose.
What we want to develop is IP and the worlds that impact the popular culture. And here, again, I wanted to reference back the world of music. When developing The Witcher, we developed a benchmark on what a fantasy game was supposed to sound like. Again, in Cyberpunk, we have dozens of songs by various artists that are now very popular in streaming services. All these things constitute knowledge that we're going to reuse in our future projects. And now, commenting on the future, we always stressed the immense potential of Cyberpunk that we want to build on. This is one of our three IPs, apart from Witcher and Hadar. We're going to hear more about Hadar today.
As a result, we decided not to develop any more add-ons for Cyberpunk 2077, but rather to start designing a full sequel to the game under the Project Orion code name. This project is on a conceptual design level right now, and it's going to be designed by a team of veterans who were responsible for fine-tuning Cyberpunk 2077 and designing Phantom Liberty. We're going to work out of North America, Vancouver and Boston locations. Team leadership are already there, and late in 2024, we're going to work with teams comprising several dozen people, while as a target, half of the developers are going to work out of northern U.S. and another half of, out of Poland. This is it from me. Now let me invite Michał Nowakowski to tell us more about the future of our franchise. Thank you.
Thanks, Adam, and good afternoon, everyone. It's a pleasure seeing you in this semi-dark room, but still. Just like Adam said, I'll do my best to discuss the future of the Cyberpunk franchise. Namely, what is outside of the game, as we've heard a lot about the game itself already. What do we understand as the franchise? It's the brand and how we shape it outside of the core game. Let me stress again, whenever you consider us, you think of us as game developers. That's true, but that's not the full truth. We want to be popular culture developers, with games at the core of all that development. True, but we want to be even more bold in moving beyond just that.
In particular, in terms of revenue streams, obviously, these various areas are not equal in weight, but they are all more than relevant because of their fan base impact and a way for us to communicate with our fan base. When talking about Cyberpunk 2077, it's even more relevant, given that for this brand, we own all fields we have used, use now, and will continue to use to further grow our franchise, and that's one of our strategic objectives. We discussed that in our strategic update in October last year, if I'm correct. One of our most recent moves outside of the game was Cyberpunk: Edgerunners. This project idea dates back to 2017, when we were discussing entering the cinematic field.
In order not to bite on more than we can chew, we decided to move into animation and the anime genre, because Cyberpunk, in general, used to be linked very closely to the Japanese animation. That's why in 2017 and 2018, we started working with the Japanese Studio Trigger, which culminated in the 2022 release of the Edgerunners series on the Netflix platform. This, combined with the Edgerunners update, that is the 1.6 patch, drove our sales in Q3 2022, and also brought us a new wave of fans. Just like I mentioned, though, Edgerunners is not our only move beyond our core and into the franchise world. Our franchise wheel, that we discussed in that strategic update in October 2022, has more.
There have been efforts before the release, during and after the release, and we're going to see even more in the time between the Phantom Liberty release and the Project Orion release, the sequel to Cyberpunk 2077. We aim to continue on that note. We learned a lot already, and we continue with our learning. We believe, however, we're able to be even more effective and impactful. Here you have many examples of what we achieved already. That is music, the physical release, but also the streaming platform releases, a book by Rafał Kosik. No random stuff, the comic books, Big City Dreams in particular, with Bartosz Sztybor and Krzysztof Ostrowski as the artists and the Hugo Awards nomination.
It's relevant in that for fantasy and sci-fi, the Hugo Awards are an equivalent to mainstream Oscars or Golden Globes, and this was the first-ever nomination for Polish artists. This has never happened before, and the awards are handed out at the Worldc on. We're very proud even with the nomination. Coming back to our merch, we had gaming chairs, shoes, cast iron car models, figurines, and many others. Where we felt we were the most impactful was actually the animation and the cinematic teams. We also aimed at feature movies, and some time ago, we already started working with a Hollywood-based producer company, Anonymous Content. They were involved in True Detective and Mr. Robot, but also Spotlight or The Revenant with Leonardo DiCaprio, an Academy Awards nominee.
They work with Garrett Kemble, David Levine, Adam Schwartz, the people involved in the Game of Thrones HBO series for the first few seasons, and that's the team that's gonna work with us also in our cinematic efforts aimed at a live-action format. There aren't many more details that will be available at this stage, so we need to ask for a bit more of patience, but we will share these details as they become available. My presentation time is slowly coming to an end, but let me share a cool number, too. You may have already done the addition in your heads, but let's share that nonetheless. Adam mentioned that our sales for the main game, Cyberpunk 2077, was 25 million copies, not including 3 million copies for the expansion.
If you add that to our other sales, mainly in The Witcher franchise, that's a total of over 100 million copies of our games sold. We're very proud with that number, and we hope to grow it even more in the coming years with you as witnesses. This is it from me, but now let me invite Adam Kiciński to the stage.
I'm very happy standing to a number with so many zeros at the end, but actually, our reason for being is different than just the numbers. It's to enrich popular culture. It's to tell stories to remember. It's to tell stories that will stay with our players for years and enrich their lives. That's our reason for being. The numbers only confirm if we're on the right path to there, and actually, they are pretty good in doing so.
I can remember this path from the very start. I joined a company my brother, Michał Kiciński, started together with Marcin Iwiński. I was the first employee, and back then, we imported boxed version of games, CD games from the West. If we were successful, we were able to sell several dozen copies of a single title. Then we became a local publisher, and our localization of Baldur's Gate sold 18 million copies. I'm sorry, 18,000 copies. Of course, I need to, like, scale back to that past. Then we started developing the first Witcher game, and we were dreaming about selling 1 million copies, but we thought that number was unattainable. We reached that one year after the first release, and now we're at 100 million copies of games CD Projekt Red sold out of what we produced, and that's stunning.
It seems we have a reproducible pattern for success. Each game we put on the market, each expansion we put on the market succeeded. It's not an easy fix, but we know what we want, and implementing that creates a solid base for future growth. It's also a moment for reflection. Next year, I will have been with CD Projekt for 30 years, and I decided to apply for a supervisory board position. To enter the supervisory board at the start of 2025, I will remain on the management board for another year and three months, but the first transformative step is that in the next three months, I will shift to Chief Strategy Officer position and will again have a joint CEO position.
That's cool because, we've had that for many years, and Adam Kiciński and Michał Nowakowski are going to jointly adopt the CEO position. Congratulations. Congratulations!
... Congratulations. Okay, we both have our mics. I don't think we need the remote control. Let's keep it short and sweet. After this announcement of by that we've just heard about this story, there's not much to add. This is a huge challenge for both of us. I hope this is going to be fun, but this is also, of course, an obligation that we have towards our team throughout the world, towards the gamers who will buy our games and play our games, but also, of course, towards the investors. We never forget about them. In the company, we will simply be continuing what is nice in the company, what we like in it, but we also have huge ambitions. We want to reach new summits, and we want to get there.
I encourage you to follow us, to follow what we do in creating and shaping pop culture in the future, and I hope we meet at next conferences. This is not time to present our policy or our strategy. The time will come to do that. Maybe we haven't been so long; we haven't been here 30 years, but 20-something. We are also some of the builders of the foundations of this company. I want to promise you that, in spite of this change, the foundations, the main principles behind CD Projekt's reputation will be maintained. We will be fair. We will be fair to business, to gamers. We will create very deep, mature, immersive games. Quality will always remain the most important for us.
All our business decisions, all our artistic decisions will be based on these principles, and I hope we will give you a shitload of entertainment. This is my objective, and this is Michał's objective. This change is natural or supernatural. Adam and Michał have been in charge of CD Projek Red for years. The studio now has grown so much that it's almost the whole business of CD Projekt, so basically this is a continuation of something that started years ago. This is a fully natural change, and the company remains entrusted to good, the best hands available. Thank you very much. And now time for a Q&A. Piotr will join us. Perhaps there will be some financial questions.
Well, this is a given. Yes, we already have a financial question. We'll go to it.
We already have a number of questions that come from our online participants, so let's split this part. So if you want to ask a question first on site, please go ahead.
Maria Mickiewicz-Hutt. Two questions, financial questions. The first one is about the coefficient of conversion, so the 15% for the expansion. In The Witcher, the best expansions had 20%-25% even, but this is during the whole life cycle of the product. The question is, what was the coefficient for The Witcher expansions after one week? This is going to be a nice benchmark for us. And the marketing budget, PLN 95 million. You mentioned PLN 95 million in communication budget. The majority probably is Q3, but I wanted to ask you about what part of the expenditure was incurred until Q2.
How much have we already seen in the results, and how much goes to Q2, Q3? The first question first. We tried to get that information about sales of expansion, of Witcher expansions after one week. After seven or eight years, it was impossible to mine it out. Most of the reports we get are granulated by month, so we are unable to compare it by week. The 20% that you mentioned is a figure I remember very well. We were very proud of it. We were proud after a few months. As far as I remember, this was after releasing the Game of the Year version that also had both expansions, and this was, I think, half a year, six months after the second expansion. There was only six months before expansion one and expansion two. It's very difficult to compare.
What's a good perspective to rate the scale of the success of the expansion in relation to the number of main games. So 15% after seven days or so is a nice achievement. What part of the expenditures about the expansion related to the expansion was incurred until the end of Q2? We haven't yet reported this. It didn't burden the result because it was part, it was visible in the balance sheet as development budget that we don't break down into other parts. Yes, the next question now. There are two questions... HSBC. Two, well, the first probably was short. What are your estimates? What is the estimate of the management board for the next premieres of the next games of CD Projekt? And the second question, you mentioned that Phantom Liberty should become a long seller.
What will be the marketing investments related to maintaining the sales? When will the company stop supporting Phantom Liberty in terms of marketing expenditures? Could you please compare it also to the expenditures of the expansions to Witcher 3?
Well, the short answer is, we are not giving you yet any dates for the releases. I mean, it's not time yet, but this is usually at the beginning of a marketing campaign, and none of the coming games are at that stage yet. The marketing campaign, the majority of the marketing campaign, happens around the premiere, then in Q3 in September, and probably a few weeks after the premiere, so in October. At the same time, this is where the majority of the budget will be spent. The budget is PLN 95 million.
Now, support of communication with the gamers, just like in the case of The Witcher, we will be active for years. We want to be active in all the products that accompany our activity, and also all the works, all the other. So the movies, et cetera, so everything that is connected to the franchise.
Emil Popowski, PKO. I congratulate you on those figures. It's nice to hear. A question about a product, I didn't hear what product? And the second question is about production. You said the Polaris is in pre-production. Does production last four years? I mean, a similar game to Polaris, how long would it take? And another question about the costs.
I remember during the annual conference, you said you had increased remuneration by 27%, and there was supposed to be a similar increase this year. What are the plans for next year? I think the budgets will have to go up. The first question, what was the first- The Game of the Year. The Game of the Year. What plans do you have about Game of the Year?
Okay. Now, in terms of a new edition, collective edition, we don't know the name yet, but when the time comes, we'll let you know. Well, with Witcher 3, it took some time to do it, but we don't want to compare it because, perhaps we will adopt a new approach, a different approach than in The Witcher.
You don't have to compare it to The Witcher until we release the full edition. We do have some intentions, but it's not yet time to discuss them. Second question was about Polaris. It's a very good question about how long we are going to produce Polaris. It's not that easy to calculate, and we are not yet divulging any dates.
The third question, I also asked about an increase in remuneration. You said you increased them by 27% in 2022, and what is the way ahead? We didn't guide or we didn't divulge any information about any plans about raises. For now, we have nothing to add. Let me add one thing.
This year, thanks to a vote during the general assembly, we have a new share option, stock option, plan, and it's going to be used as an element of the remuneration policy and the raising, raise policy. It concerns 200 people in the company, and in the remuneration mix, this is also going to be, there's going to be an option package, too. Generally offer, and you, mentioned building pop culture, and you stressed Edgerunners. This was also something that, that basically was driving the sales of Cyberpunk.
Do you have any more plans here?
Yes, we do have plans. That's why we are starting operating with Anonymous Content. We want things to happen. A lot is happening. A lot is planned.
Trigger was in 2018, but it started in 2022, so for a number of years we did not speak about this because it wasn't ready. There are plans. We'd rather keep quiet until there is something to speak about, until there is really something to discuss, some concrete announcements. When the time comes, we'll tell you. I know I keep repeating it, but yes, the general direction is this, to go this way. This is strategically important for us. What's also important is that Trigger, our partner, has certain rules for announcing projects, and we have to be compliant with this.
A pytanie live action jeszcze? Live action question: How long does it take to finish such a project?
There is no simple recipe about how long. We were here...
Now even before we looked through a number of scripts, we were considering them, but this had to be stopped due to the authors' strike in Hollywood. As you know, the strike is over, so we can now go back to reading some scripts.
Some concrete steps have been taken, but we can't yet tell you who is going to do what at what time. Usually, it takes years. It's not something that is going to happen overnight. So I have a question to Piotr Nielubowicz, probably.
Could you please elaborate on the depreciation scheme for Phantom Liberty? How does it compare to the previous depreciation approaches you had?
In The Witcher, we had a completely different methodology, namely, we didn't adopt a scheme of depreciation, but this was done on a current manner.
We depreciated the expenditures towards the income. Now, we have adopted a new methodology that follows the current MSRs, and we have to foresee the future sales and then make an average, simplify, and based on the forecast, we have to adapt the distribution of our depreciation amount. What I can say is with we have Q3, Q4 with 20%, the remaining 60% will be depreciated within five years. It's unlike for Cyberpunk, we have now better visibility. After the premiere, without the proper quality of data about monetization of Cyberpunk, we adopted a flat distribution. Now, we think this distribution should be decreasing, year by year. How it's going to decrease, what is going to be the inclination angle of this curve? Well, it depends on Phantom Liberty, and we will adapt the model, for the next month or quarters.
Let me go back to the motivational, the incentive program. In the B part, you have your objective for 2023-2026. From today's perspective, after the reception of this expansion, do you think this is a very ambitious, ambitious, or rather achievable objective, PLN 2 million, blood? I think, yes, we always have ve ry ambitious objectives, and this one is no exception. Did you want to add something? No. Tomasz Adach. Tomasz Adach?
I wanted to ask about your current view on how long the marketing campaigns for your games should be. I know you change your mind, sometimes longer, sometimes shorter. For Cyberpunk in 2018, when there was the beep, famous beep, it was 2018, and then almost three years after that, at the end of 2020, came Cyberpunk and the premiere. What...
How do you see it now for Polaris? How, how early are we going to start?
I want to correct one thing. The tweet, the X, the beep, it wasn't the beginning of the marketing campaign, it was a, an information campaign. The marketing campaign for us is actual actions with money spent, that are meant at presenting the product and the game to the gamers. PR campaign information, of course, that happens earlier. We want to inform our gamers about what we do, what we are doing, what we are working on. I'm not going to give you a date for Polaris or Orion, a point in time, but this is going to start earlier than the marketing campaign itself. If you call it a marketing campaign, it's fine, but for us it isn't.
The real marketing campaign, the promotion, when we push money, when we spend money on promoting the game, there isn't one good answer in our view for every project. But for a new game-
Irrespective of whether it has previous part or no, it should be more or less one year, not more. So when we started the actual, the real campaign of Cyberpunk, we didn't know about the delay, obviously, so it wasn't intended in this way, obviously. But around one year, this is how long it takes to promote one game. It doesn't have to be 12 months. It's not exact science. It can be 9 months with an expansion. This is slightly shorter. As our stream's almost over, let me take one of the online questions about something Adam mentioned already: Can we estimate the size of the team to be working on Orion? And do we assume that an average team member is going to earn significantly more than the current average remuneration paid to developers at CD Projekt?
The latter is related to the averages and also to us, the developing our North American studio, right? Well, answering the first, we don't know yet. It's a part of our transformation. We want to work in effective teams, and large teams are not necessarily the most effective. We will also shift to a model involving a lot of contractual work, contract-based work, so it's difficult to discuss the size of the core team. We will take these decisions towards the end of 2024, when we'll be way more advanced in working on pre-production, on the game concept. As to your second question, well, it's a natural consequence of teams working out of Europe versus North America, with North American market being more costly as compared to Europe, Eastern Europe in particular. The averages will obviously go up. Now the last question.
A brief follow-up to the marketing campaign question, but now for information campaign. With Cyberpunk, you showed the first materials back in 2013, if I'm correct. Now, looking at the new coming projects, are you also able to show us something very early on, or would you rather wait much longer with this sort of information?
Well, let me give you a convoluted answer. When talking about 2013, we did the reveal as we thought we were going to produce earlier. If we knew it was going to be delayed, we would probably have held on to the materials longer. Now, when talking about when we are going to show you stuff, we'll show you stuff when we have cool stuff to show off, and when the circumstances are right, so that we don't do a reveal at a random moment.
We have to build up to that to get adequate response. But first and foremost of all, we need to have a value that we want to showcase and present to the players. The situation back then was very unique in terms of circumstances. We were known for our Witcher production already, and we knew we had a huge marketing and promotional campaign for Witcher 3 ahead of us, so we decided to notify players about the next upcoming project, because on the occasion of The Witcher 3 campaign, we wanted to promote this next direction we were going to take. Thank you. Thank you so much. Thanks. And now a brief invitation from me. Please move to our main building, just next door, the less official part, or even a celebratory glass of something to celebrate the 100 million is going to happen there.
I also heard that some of you would enjoy a tour of our studio. I will be more than happy to be a guide for those of you who share that wish.