In 2000/1 at Codemasters I was involved in the marketing of an excellent fantasy combat game for the PC called Severance Blade of Darkness, from the Spanish developer Rebel Act Studios, which launched to some fantastic reviews and accolades. The game soon found it’s way on to millions of keen game player’s PCs, it became popular with mod makers and attracted a cult following. Yet we sold very few of the game. Nearly every player was using a pirated copy downloaded from the internet. So Rebel Act got no royalties and went bust. And the PC community deprived itself of future great games from this talented studio.
So it came as no surprise to me to read that the PC game Riccochet Infinity has a piracy rate of 92%. Quite simply, if you are a publisher of PC games, it is best to regard all potential customers as thieves. Not just ordinary thieves, but skilled and crafty thieves who will apply a lot of knowledge and work to stealing your game. In fact there are people who work in the games industry who crack the protection on games for a hobby. Just how stupid can you get?
We live in an age were many millions of people get away with stealing (6 million in the UK alone) . And they think nothing of it. They get all their entertainment for free. They download games, music and films at will. They use a technology called bit torrent on peer to peer networks to steal anything and everything that they want. To give you an idea of the scale of the problem, 80% of all internet traffic is now torrents.
It is difficult to make a PC game these days and get your money back. So now there are obviously a lot less PC games made, the PC gamer has destroyed the market by not paying for something he uses.
What has happened on PC has also happened on PSP, so very few games are now being written for it. The DS is just going the same way. It can happen to any gaming platform. Once it is cracked most people will not pay for games, they would rather steal. It happened to Playstation One and it could happen to Xbox 360 or Playstation 3. A multi billion global market could just disappear in a matter of months.
So it is nice to see that the British Government have got it right for once. The only way to stop torrents is with the help of the ISPs. So the government want IP thieves to receive a three stage warning from their ISPs. The last stage of which involves cutting their internet connection. And really this is the only way forward.
If torrents aren’t stopped then the recorded music industry and the movie industry are dead. With nobody paying for their entertainment there will be no money for that entertainment to be made. It is that simple. With games we have access to technologies such as server based gaming which should be 100% thief-proof. It needs to be.
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I don’t think illegal downloads and reselling makes any difference to developers. Both are channels in which there is no value to extract for the original creator. So why is one receiving so much attention and the other not?
Both of those issues can be solved without Starforce, or similar hideous implements, by adding consumable value to the original title. Unreal included custom unlockable characters, for example.
The media consumer is moving towards a two-stage mindset; some media, which you’re likely not to have bought anyway, is consumed for free. Other media you go out of your way to support and gladly pay extra to be considered a supporter. Indeed, you could argue that consumers have always had this view, but the one-fee-for-all mindset of traditional publishers have prevented both from getting what they want.
Why, for example, did people buy the 9-disc special edition of LotR when it could always be downloaded online? The regular editions, however, did not sell very well, and were probably downloaded in droves.
We need to understand that the cat has been let out of the bag and the development model is changing. We can no longer release a single player game and expect everyone to buy it. We can, however, get consumers involved in our development, by extensive on-site reporting (think bungie.net) where the purchase is seen as a ticket in to a community.
We need to personalize the product, add loads of consumable value, include lots of online extra elements and consider the disc itself a way for a consumer to show his allegiance.
Anything else if fighting the tide.
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But this level of community involvement is not always a value for players. In fact, when you get out from the 3D hardcore helm like Bungie’s games, most casual games players don’t mind for online and community features at all. And the advertising model simply does not generate enough revenue to make quality casual games. It must sell units, it’s that simple.
Even if players see some value on online features, it’s also not always possible for small and indie developers to sustain it.
I wrote and article a while ago explaining how piracy broke the once-prosperous Brazilian game console industry. Yes, unlike China and India, we once had a legal and growing console market. But piracy destroyed it, and 100% of console games and 94% of PC games are now pirated here. I believe it’s an indisputable real-life example for those who claim piracy is not a big issue because “people wouldn’t buy anyway”:
http://texpine.com/2008/02/15/how-piracy-can-break-an-industry-the-brazilian-case/
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Oh yes, the thing on Torrents – not only Torrents but also share sites, eMule and P2P networks, IRC DCC. They all should be object of discussion. The principle behind them is actually very good, it fosters the freedom of information and speech.
But it’s quite obvious right now people abused it enormously. The vast majority of traffic on these networks are pirated content, no questions about it. Music was just the beginning – games, videos, books, comics and general software. Every single form of digital content and art is pirated.
In Brazil, the whole thing is so out of control that one says he’s going do “download” something, rest assured it will be a pirated copy.
And I know banning p2p networks, share sites and IRC DCC won’t solve the problem – one can always put on FTPs and share on blogs. But for certain it would help enormously!
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The question always comes down to “how many pirates would have bought the game if they could not pirate it”. The article about Riccochet analyses different actions taken to reduce piracy and their results, and it shows that “for every 1,000 pirated copies [they] eliminated, [they] created 1 additional sale”.
It feels like it is not really worth the effort, but I wonder how this observation made on a low-budget casual game relates to AAA titles.
I think AAA games tend to gain more sales when piracy is not an option. Because of the media coverage of AAA games, players want *this* game, one way or another. On the low-budget casual games side, players tend to browse for games, find one they like, look for a warez version… and if they don’t find it, they just resume on browsing for another one.
As for myself, I have to confess I’ve hurt Severance sales too. When I first saw it, I thought “cool game, gonna buy when the price drops”. And I bought it a few months ago, for $2… (still a cool game, btw) I wonder how many people do that, and I can’t honestly tell if I would have bought it full price knowing I could not find it cheaper later.
Nintendo seems to have some kind of a “buy now full price, or never” attitude. I wonder how well that performs.
One thing is for sure, the future of big budget single-player PC games is darker than ever.
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The pirated game cds in the market ringing the heavy loss to the internet game markating
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Man, if you’re the one in the picture, you look like the italian tv star Claudio Lippi. No joking. Check it out by yourself:
http://www.radiowebitalia.it/img/archivio/m1054.jpg
Nice blog anyway.
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I think this is so wrong. There is no stealing involved in downloading movies or music for free: it’s just the market economy at play here. Instead you want again to protect the so called intellectual property rights of the industry. But these are monopoly rights and monopolies are always bad for consumers. One can stimulate creativity in other ways however – no government sanctioned monopoly is needed for that. After being screwed for years it’s rather nice that consumers are finally striking back. The end of the music industry will not be the end of music. The same goes for books: see http://techdirt.com/articles/20080218/004601276.shtml, so why would it be different for games?
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I really don’t think turning to ISPs or the government will solve anything. As was mentioned, “The cat is out of the bag,” there will always be people who pirate. I almost wonder if anti-piracy measures have made people pirate even more? I know I have gone to piracy sites to crack legitimate games I have purchased because I didn’t want to always have the cd in the computer; so now that I have cracked a purchased game the barrier to crack a pirated game is much lower. You cannot treat your customers like the enemy. I will use Steam and Stardock Central as a perfect example of this, Stardock does not even use copy protection and yet they have been in business for over a decade. Piracy is tragic, but it’s a reality. It’s time to find a better way instead of making your customers angry.
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With all due respect, there’s a startling amount of things in this article stated as clear empirical fact that well, they’re not. Some are at best naive, at worst propaganda.
Quoting Russ’ figure of 92% whilst ignoring the rest of the points he makes with regards to conversion rates and sales is disingenuous at best. The article goes to great lengths to indicate that the benefits of blocking piracy resulted in a 1 in 1000 sale conversion. A fact happily ignored in the rhetoric of this piece.
I’m not writing off the effects of piracy here, but overstating it’s effect and playing the worst case scenario card does little favours. Nor, I fear – does painting every potential customer as a criminal.
I can’t think of one successful business model short of those used by perhaps loan sharks that relies on criminalising or treating your customers with such levels of disdain.
To cover some of the inaccuracies:
“We live in an age were many millions of people get away with stealing (6 million in the UK alone)”
That leaves, at rough estimate – around 56 million people NOT pirating if your figures are to be believed (and I’d like to see some citation for this figure, it seems awfully, awfully spurious in origin).
You’re seriously condoning criminalising 56 million people, a vast majority, on the actions of a few? This is the business model you propose?
“They use a technology called bit torrent on peer to peer networks to steal anything and everything that they want. To give you an idea of the scale of the problem, 80% of all internet traffic is now torrents.”
If torrents account for 80% of internet traffic then how does streaming video account for 36%? The figure makes absolutely no sense in real terms. Can we have some empirical facts please to back this figure up? Preferably from a non partisan source?
“It is difficult to make a PC game these days and get your money back. So now there are obviously a lot less PC games made, the PC gamer has destroyed the market by not paying for something he uses.”
The unwillingness to share even the slightest culpability in a shrinking PC game market worries me. Sure, you can argue that piracy made publishers risk averse – but I’m hard pressed to think of a scenario where major players in the movie industry, the music industry or the games industry have been anything but in a long, long time. The last game I can think of that seemed even remotely “risky” that sank a company was Bandersnatch – and even then I’m sure you’d agree that folly played an equally large part in the equation.
I’m sure piracy may play a part in the demise of PC gaming, but it is not in any way solely responsible. At least a portion of the blame must land at the studio and publishers doors and those who greenlight and redlight projects, demand that creative folk hand over their works and idea’s in perpetuity, and those whose work regimes would be classed as “less than stellar”.
It’s nowhere near as black and white as you’re attempting to paint here. Placing the onus for ones own industry mistakes on the user would seem an unwise tactic to me.
“If torrents aren’t stopped then the recorded music industry and the movie industry are dead.”
The music industry signed it’s own demise long before torrents were even a gleam in the eye of the internet. A refusal to progress, to adapt and a policy of stifling change and valuing IP over an artist did this. Not torrents. Watching the games industry follow its lead is saddening in one sense, but given the motivation that it gives the Indie scene – advantageous on the other.
For reference, there’s an interesting article published on The Times with regards to A&R policy and behaviour within one of the major players in the music industry.
http://entertainment.timesonline.co.uk/tol/arts_and_entertainment/music/article3370224.ece
A damn site more telling than any amount of rhetoric with regards to the evils of piracy and torrents.
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I think Brendan is 100% correct ‘Piracy is tragic, but it’s a reality’.
Piracy is not something new. Infact, some of my Dad’s old LP’s have warnings on them telling people that copying music to tape is illegal and killing the music industry.
I remember when the Amiga was out, our local market was full of stalls selling copied games (£2 a game with 1 disk, £2 for 2 disks and so on).
I do think it’s a shame that with the complexity of games nowadays it means even small start up companies need millions of pounds of investment just to get their nose into the market.
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I think WildTangent has a wonderful idea. They will be establishing a free game network known as “Orb”. The system takes a typical household PC and turns it into a console system more powerful than any currently on the market. Apparently when a gamer wants to play a title they will be exposed to one advertisement before their game session starts. This will help eliminate piracy and also keeps developers and advertisers happy. Not to mention the boost PC gaming will get in it’s never ending batttle with the console.
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Hello Bruce, I am glad that I have an occasion to discuss this problem and give my opinion as a consumer to a professional, especially considering your position on the way entertainment should be delivered and secured from illegal copying. What I think appalling about your statement is the part where you advocate for systematically considering users as thieves!! This is not proactive thinking. The fact that the article you mention states only one legal purchase for every THOUSAND (!) pirated games were won back (and you not even quoting it) is telling of your ill-will to better apprehend the problems at stake. But then you are perfectly right, piracy IS robbery. But that it is the reason for studios “going bust”, I doubt, as far as the particular case dealt with in that article is concerned. Anyway confort and private copy should be allowed. It’s OK for me to pay for a game, but I feel offended by your statement that because I enjoy your work, whether I pay or not, I am a thief… why I’d be a dickhead if I ever pay again then!!! I suggest you read the article written by Rob Fahey for gameindustry.biz ”User Friendly”, it suggests that aggravated piracy rate is due to the paranoid, hysterical, insults made to people who bought their games/music/DVD, by forcing them to watch a pointless trailer about how you are a villain, a pirate, although you’re watching the trailer cause you’ve bought the stupid DVD in the first place. Sony making wipeout users pay for DLC in the end because of piracy infuriated those who bought the UMD, me included. I do not like to have my music DRMed. The mistrust is pointless, for though I do not know how you can win back your audience (lower prices! lower prices! lower prices!) you sure seem to make a good job of loosing what little remains.
The professionals who spend their time cracking security measures also do a great job of teaching people how to crack their PSPs and dump games, download music illegally. So industries should have been worrying about them not ever caring to learn to download since they got such a great experience… but then we got DRMs. And why shift back to legal stuff then? People aren’t stupid. I call iTunes a thief when they pretend to sell you part of the rights, but then they are merely selling you a product that is limited in time (ipods and usb keys do need to be formatted OR replaced from time to time – god knows they are disposable stuff).
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In all actuality, I think there is a certain folly to our ways in both respects. We the consumer, will, like the over zealous farmers who over tilled there land, destroy the very thing that feeds us due to an ignorance of this fragile balance. However, it is also the failure of the industry to foresee human nature acting out as it would if it had the chance. Piracy and the Internet is that chance, and human nature is doing exactly as it would. Following the path of least (cheapest) resistance.
The technology is better, the games are more diverse, and the market is larger, however, this alone will not force more sales. It only increases spending on reduced revenue.
Alternative measures must be taken, we the consumers need to actually purchase a little more, lest we forget that the our new phone, our internet, the life we live is in debited to capitalism and consumerism. Which we must respect instead of distain, and respect is the keyword. Communism was not interested in making entertaining games for the greatness of the people. Do we think it would?
We can see what is happening and must allow ourselves, as consumers, to attempt to aid the market we wish to see flourish. If we want more and better games we must respect the market and give people their dues. Else wise, all those amazing programmers and game designers will be working on developing the next Excel 10.0 as the business sector are the only people still playing (paying) by the rules and thus introducing capital to their budding farm. They are investing in what they want, we as gamers should do the same.
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Hello, from where I can download it ?
the full version please