Blitz Games Studios has closed 1UP, the indie publishing label it set up in 2008 to help small developers get their games to market, and is shifting focus to IndieCity, a new download service to launch this summer.
Speaking to Develop, 1UP producer Neil Holmes blamed the closure on a changing marketplace, with the dominance of Steam, and the "race to zero" forcing prices down elsewhere, meaning the initiative was no longer sustainable.
"What's changed is that the market seems to have shifted quite a lot in the way games are sold," he said. "Two years ago you could go through all of the portals and you could get business in all [of them].
"Now, if you go through Steam you can get good sales, and that’s about it; if you go through anywhere else you’re nowhere."
In three years, 1UP supported 30 games, published 15 and advised some 150 indie developers, but the decrease in prices over those two years - led by casual gaming portal Big Fish, but also greatly driven by 99¢ mobile apps - have led Blitz to the conclusion that 1UP is no longer sustainable.
"After Big Fish everybody else panicked and followed suit," Holmes said. "There's not really a sustainable business model today for a lot of the indie studios, which is such a shame because there's really so much creativity and so much great stuff that is in that area that just isn't being seen and isn't getting the exposure it should."
All of which would appear to be rather bad news for IndieCity, a distribution platform that is set to launch before summer is out and is part-funded by Blitz Games. Holmes, however, believes that IndieCity can succeed where 1UP failed.
In a post on the 1UP forum, he writes: "We've been helping to create something that will address the shortcomings of Blitz 1UP and provide indie developers with a platform where they stand a much fairer chance of success.
"We believe that IndieCity represents the solution to the digital distribution issues we've encountered during the lifetime of Blitz 1UP."
Set to launch before summer is out, IndieCity bills itself as a "one-stop shop for all things indie gaming," with an eye-catching 85/15 per cent revenue split, personalised recommendations, peer-to-peer software downloads, achievements and leaderboards and, in what is clearly a nod to Minecraft's success, IndieCity Underground.
That, IndieCity's Chris Swan told Indie Game Magazine, is "where developers first put their games, which can be at any stage of development and either given away for feedback or sold. We're calling this the Pay To Finish model, and believe it could be very successful for developers who want to get a community on board early and involve them in development."
IndieCity certainly seems to address many of the problems 1UP faced, but it will also face many of its own. Chief amongst those will be Steam's dominance, as reflected in the experience of Zeboyd Games, whose two indie RPGs grossed more in a week on Steam than in 18 months on Xbox Live Indie Games.