Game Piracy Results in Lower Prices? 453
meejahor writes "The BBC reports that Sony will soon launch the PlayStation 2 in China, following Nintendo's lead with the GameCube. Most interesting about the story is the news that, because of widespread piracy in China, PS2 games 'will cost far less than they do in the US or the UK, but still be slightly more than pirated discs.' We've always been told that pirate games push prices up, but doesn't this news suggest that piracy in China has in fact pushed prices down? The story also notes that 'only two or three games will be available at launch' which seems crazy considering the likelihood that people will pirate imported games instead of waiting for them to be released officially." While the Chinese launch of PS2 has been known for a while, the pricing of Chinese games is pretty interesting, given their long history of piracy. I imagine this sort of thing would be considered in the U.S. and other countries were pirated games as widespread as they are in China.
Lower prices (Score:4, Insightful)
Re:Lower prices (Score:5, Insightful)
Re:Lower prices (Score:5, Insightful)
The idea behind economic solutions to piracy is to make the technical challenge of pirating the games so difficult that it is both easier/cheaper to buy the game from the legitimate manufacturer. This can be done via copy protection and product activation, but these anti-piracy measures have technical countermeasures which, once discovered, return the advantage to the pirates once more.
However, if the cost of the pirated game is not a great deal cheaper than the cost of the legit copy, then it makes sense to just buy the game and forget about pirating it. This kills piracy as a business model.
Of course, if the anti-piracy technologies hamper the legitimate purchaser's ability to, for example, play the game or make backup copies of the media, then from a consumer standpoint it may still make sense to make use of piracy.
So the pirate's tools may yet have some legitimate uses even for players who bought legit copies. Ironically, it's for the very techniques the manufacturers use to deter piracy!
Re:Lower prices (Score:3, Insightful)
Nothing to do with piracy (Score:5, Interesting)
Next you need to prevent grey market imports (region code etc) and then you finally have to find an excuse so that the other customers carry on buying the product and don't feel aggreived
Piracy is IMHO the excuse, nothing more, to explain to US and EU customers why they are paying vastly more for the same games. Just like Americans being ripped off with drug and school text book prices, and EU people with DVD pricing.
Re:Nothing to do with piracy (Score:3, Insightful)
Re:Nothing to do with piracy (Score:3, Informative)
Actually, this is called price discrimination and it's common business practice throughout the US and the world. Other forms of price discrimination which you may be familiar with are coupons and senior discounts. All business sell at whatever price the consumer will pay, which is why Americans get "ripped off" on text books.
Re:Nothing to do with piracy (Score:3, Insightful)
Price discrimination is, for example, when a movie theater charges different prices for different ages. This, to me, is different from the above case...
Sivaram V
Re:Lower prices (Score:3, Interesting)
Still waiting... :-P
Didn't a lot of people call it the "Internet revolution"? I wonder why they'd do that?
Re:Lower prices (Score:3, Insightful)
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Re:Lower prices (Score:4, Insightful)
Re:Lower prices (Score:4, Interesting)
Speak to any economist and they will tell you that Microsoft isn't a monopoly because it can only charge about 1/16th of the monopoly price of Windows. Why? Because piracy undermines its monopoly position and therefore acts as competition.
The same applies with games. The greater the extent of piracy, the more price elastic is demand and so consumers are more willing to switch from the legal to illegal alternative. Thus in countries with a high acceptance of piracy, the "legal premium" of paying for the official product is small, and companies can only charge a price a little higher than the blackmarket pirates charge.
Re:Lower prices (Score:5, Insightful)
What the original poster meant was that piracy is competition, not that the competition commits piracy (there's a difference). Just the basic fact games in china will sell for less is proof that piracy IS competition.
Re:Lower prices (Score:5, Insightful)
After all, the SRP for a game in US is higher than the average monthly salary in most of China - or in much of Latin America, for that matter. You might think that would mean the game companies would simply give up on those areas, but insofar as the marginal costs of a game are virtually negligible, there's real reasons why they might not want to.
It's a tricky situation for game developers, who want to access the economy of scale on those other markets while still protecting the high mark-ups in cash-rich countries like the US and Japan.
Re:Lower prices (Score:3, Interesting)
However, it's OK for U.S. movie and media producers to sell their products overseas at prices that American consumers can only dream of?
Re:Lower prices (Score:3, Insightful)
Re:Lower prices (Score:5, Insightful)
Re:Lower prices (Score:5, Insightful)
It's easy to do the math. The only way out if you want cheaper games is to accept simpler games. Look at toonshading on the Gamecube - or games as simple and fun as ZooCube, Super Monkey Ball etc.
If you want a life-like Star Wars : KotOR - expect to pay a _lot_ for that pleasure. Development takes time, and costs a lot of money.
Re:Lower prices (Score:3, Insightful)
One thing that beef's me though about netplay games is that you can't make your own server. If I pay 80$ for an xbox game I should be allowed to make my own server so Idon't have to play with the asshat 12 yr olds that are going to whoop my ass anyways
Tom
Re:Lower prices (Score:5, Informative)
The graphics might be what sells a game, but it's not what keeps people playing it.
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Re:Lower prices (Score:2, Informative)
Is there any way openness could be less efficient than closed?
Re:Lower prices (Score:5, Insightful)
>Is there any way openness could be less efficient than closed?
Set timelines. (Closed: I can set a deadline and everyone will work towards that goal. Open: Its done when its done.)
Definite commitment to the project. (Closed: people have alot invested to make sure that the project is a sucess. Open: I can leave the project at a drop of a hat and have very little repercussions)
Startup (closed: I just have to convince upper management that people should be working on my project. Open: I have to convince everyone that they should work on it)
Re:Lower prices (Score:3, Interesting)
I didn't play games for the a bout six years when I was running Linux only. Then, out of a whim, I bought and installed Ghost Recon and was completely blown away by the experience. I just could not believe how immersive a game could be.
If anything, that - and experimenting with user created GR scenarious with abyssmal voice-acting and scenarios - taught me that sometimes it just is worth paying fo
Re:Yeah right. The matrix revolutions, $8 (Score:2)
But then, why would I expect a slashdotter to understand a business....
Re:Yeah right. The matrix revolutions, $8 (Score:5, Informative)
As for whether publishers and distributers take a bigger cut in the gaming business than the movie business, that's a toughie - I don't know enough to say for sure. But a successful movie might take in 50-100 million dollars so there is more to go around. However, retail chains get much more favorable terms for PC games than for DVD movies, simply because return rates and compatibility issues are massive. Publishers have to deal with support issues, which are also massive.
Try writing a 3D game, which has to run on EVERYBODY'S PC and compare to doing some animations in Maya, which just have to look good from one angle and get rendered once. Not dissing on the Matrix or other heavy-FX movies, but it's really a hell of a lot of work to support and distribute a modern 3D PC game.
This, of course, is why nobody really wants to develop for the flooded PC market and why the console market exists, if you are well capitalized and can afford to hire the right people, get all the SDKs and negotiate good terms.
Re:Lower prices (Score:2)
Re:Lower prices (Score:4, Insightful)
Re:Lower prices (Score:5, Interesting)
The creators are greedy for profit, their excuse of jacking up prices because of piracy is bull! If they can sell a $5 item for $500, and people will pay, why not?
The consumers likewise are greedy, afterall the best things in life are free, their excuse of stealing because of high cost is bull! If It is worth $50 and you sell it for $25, and they can get it for free with little effort and without getting in trouble with the law, they will do it guilty free!
Greed is the problem, has been with us since the beginning of time, and it is not going away, anytime soon, so wishful thinking.
Re:Lower prices (Score:5, Insightful)
The consumers likewise are greedy, afterall the best things in life are free, their excuse of stealing because of high cost is bull! If It is worth $50 and you sell it for $25, and they can get it for free with little effort and without getting in trouble with the law, they will do it guilty free!
Yes, both sides a greedy for their own gain. The principle is, however, tht there is some agreeable middle ground where supply and demand meet nicely.
Currently either side is busy pushing the extremes. The publishers keep pushing prices up, and the consumers keep balking and pirating. Someone needs to take a step back, realise this is a self perpetuating cycle, and agree to step into the middle ground. It looks like this is what is happening in China. Sony may make a loss having to sell their games a little below cost, but the people might decide it's worth spending the few dollars extra to get a proper version of the game. Eventually, hopefully a balance can then be struck.
Jedidiah
Re:Lower prices (Score:5, Insightful)
"No, lower prices do come from rampant copyright-infringement, RTFU",
It seems you're trying to apply canned economic theory to this situation. Is that a good idea? I'd assert that:
1. What people call 'intellectual property' breaks canned or conventional economic theory, and that
2. China, in particular, is hardly the playground of Western Economic Theory.
RD
Re:Lower prices (Score:5, Insightful)
1. "Economic theory is very happy with property rights... property in the abstract including IP, your house, the local park or the outback."
You missed my point, friend. I'm saying that the existence of non-material, non-intrinsically-scarce, copyrighted works challenges the very idea of property.
2. "This is the same 'Western Economic theory' that came up with Marxism (err, Marx was the economist in question) which led to consumism [I believe you meant communism- RD] etc... and that China in its communist heydey, the USSR etc employed orthodox economic theory just as the FED or EU does today."
Perhaps my point is that Classical Economics, as the above poster appeared to be using, has difficulty during periods of transition- doubly applicable to China, as both China itself and the items we're talking about, copyrighted works, are undergoing significant change. If this was a long-established, unchanging-in-nature market item in an economy and system not undergoing rapid evolutionary change, I'd give you your point. As is, I withhold it.
I appreciated your comment on the nature of economics. For your first and last snide comments, however, STFU Troll.
RD
Re:Lower prices (Score:5, Interesting)
Re:Lower prices (Score:3, Insightful)
PC developers do not pay to make a licensed game, are not charged royalties per copy, and do not need special equipment to burn and test their product. Developing for the PS2, as an example, requires a license from Sony, royalties to be paid to Sony, and a PS2 developer's kit.
Re:Lower prices come from lower production values (Score:2)
Re:Lower prices (Score:3, Insightful)
Re:Lower prices (Score:2)
Re:Lower prices (Score:2)
lower prices (Score:5, Interesting)
Re:lower prices (Score:2)
Re:lower prices (Score:5, Insightful)
It's a bit of a smack in the face to the rest of the world though. Play by the rules, stay legitmate, get shafted (price-wise). Pirate to your heart's content, get discounts. Nice.
Re:lower prices (Score:3, Insightful)
Re:lower prices (Score:3, Insightful)
It's one thing to get the crap kicked out of you by the police for sitting at the wrong end of the lunch counter, it's
Re:lower prices (Score:5, Interesting)
Well, maybe someone should :-) (perhaps a mass of a thousand college students? I'm sure that would at least make a splash in the press...).
But I'd be quite happy to get slapped with a tort for violating copyright. I would go to court to fight it, probably lose, then happily pay the fine. Can I look "sympathetic"? Maybe, maybe not: I'm just a college student downloading the music he can't hear over the radio, because I don't have a radio and I can't find a good webcasting radio station I like; downloading to the tune of maybe twenty songs. The way I figure, if I lose I'm out a whole $20 (if that's the cost of downloading those 20 songs off iTunes legitimately) - I believe I could argue (in a civil court) that that's the value of the songs. And it would make for a rather entertaining story: "student sued for listening to music you're listening to on the radio right now". I feel that the potential punishment to me (getting hit with that tort) is worth the statement I'd be making - even if only to a small-time local newspaper.
I'm not saying copyrights are completely wrong, and I won't advocate ignoring them without cause. But I will break the parts of the law I feel are wrong, and I am prepared for the costs of that belief. I ain't Gandhi and I ain't trying to go to jail, but I am not going to roll over and let a monopoly dictate how much I have to pay for music I can hear over the radio for free. That price is for market forces (e.g. iTunes) to determine.
Re:lower prices (Score:5, Interesting)
It worked for music. Thanks to Napster and other P2P systems, I can legally get virtually all of the music I'm interested in for $.99/song or $9.99/album at iTunes. Beats the old days of Record & Tape Traders, Waxie Maxies, and the incredibly price-bloated Tower Records.
Re:lower prices (Score:3, Insightful)
I've seen pictures of markets in china lined with pirated CDs and other such material. Games included. If someone in China can buy a Pirated game fo 2$ (US), as compared to 50$ (US) they will no doubt buy it for 2, even if it is pirated. I myself wi
It will not change anything (Score:3, Interesting)
Re:It will not change anything (Score:3, Insightful)
You are miss interperating "piracy" (Score:2)
Re: piracy and countermeasures (Score:3, Insightful)
To be perfectly honest about it, that's what made me go out and purchase both Warcraft 3 and the Frozen Throne expansion. I really have a problem with Blizzard's legal attack on people creating freeware alternatives to their "Battle.net" servers, yet I was really looking forward to playing WC3
what an idot (Score:5, Insightful)
Re:what an idot (Score:2, Interesting)
Re:what an idot (Score:2, Informative)
Re:what an idot (Score:2, Insightful)
Re:what an idot (Score:3, Insightful)
While this makes the publisher sound like they've got a really sweet deal, a ton of games are indeed flops and don't make enough money to pay off the developers, marketing, and distribution efforts.
Re:what an idot (Score:3, Insightful)
All they have to do is translate a few games and they can pull in a bunch of cash. Sounds like a winning situation to me. In the old days that used to be hard, games didn't have a l
Re: (Score:2)
If Piracy of PS2 games was so rampant... (Score:2, Insightful)
Same differential pricing game as drugs (Score:5, Interesting)
Isn't this also the same rationale used for region coding with DVDs? They're sold in high piracy markets for much lower prices, which are still profitable for their makers, and the region coding protects their high margin markets from imports.
And the same is true for drugs and a host of other things sold overseas. Have the US/Japan/Europe make the real profit and subsidize low-margin (but not unprofitable) Third World markets. Use legislation to enforce this model. Profit!!
Re:Same differential pricing game as drugs (Score:5, Interesting)
And just like how local US governments are going to Canada for cheaper drugs, so will they import these games to the US.
Get ready to crack open that Manderin/English dictonary!
Re:Same differential pricing game as drugs (Score:3, Interesting)
Your Radical Ideas... (Score:4, Informative)
Re:Same differential pricing game as drugs (Score:3, Interesting)
Re:Same differential pricing game as drugs (Score:2)
If the Chinese market makes enough money for selling there to be profitable, then you can be sure that the overall margins are being propped up by extremely high margin sales in richer countries.
Um, no. Games in wealthy countries will be sold at the whatever price the market will buy them at. If they could raise the cost, as in your scenerio, they already would have, piracy or no piracy. Companies don't just turn down free money.
Lower prices? or litigation... (Score:2, Insightful)
Or you might just end up with a situation like the one in the music industry. Some sort of video game RIAA that is formed and then proceeds to try to regain control via lawsuits.
~gb
Profiteering (Score:4, Interesting)
>but doesn't this news suggest that piracy in China
>has in fact pushed prices down?
Ever hear of profiteering [reference.com]? It's easy to compete with pirates if your prices are bloated to begin with. In the bygone era, profiteering was a dirty, ugly word. Today it is heralded because it makes shareholders happy.
China is communist (Score:5, Insightful)
Piracy effectively becomes "exercise of the People's right to pool and share resources".
Re:China is communist (Score:5, Insightful)
The reason why China doesn't really recognise copyright and IP laws right now is because it doesn't suit their developing economy. Just like why they don't float their currency. If you look at the past history of Europe and America, when those economies were developing, they had very loose IP laws (or loose enforcement). For example British authors used to be totally pissed off with the very widespread and blatant piracy of their books in America. It was only when their economies were developed enough to actually make them think they have something worth protecting from new upstarts that they started getting concerned with copyright. Stealing IP from smuggling plants out of a country to pirating entertainment seems to be the common way for developing nations to get a step forwards...
Re:China is communist (Score:3, Insightful)
I'm always amazed when the Chinese think nothing of copying every program offered for sale in the USA. But, when I want a program that does Optical Character Recognition on Chinese characters and converts them to Unicode, and just ask for a free copy, they're just stunned and amazed that I would assume that they wo
Piracy is GOOD (Score:2, Interesting)
Competing with Monopolies (Score:5, Interesting)
But I'd like to point out here that most gaming companies don't make money. Large publishers, who are in the best position to be raking it in, are merely scraping by. Nintendo and Microsoft lost money last quarter. Gaming companies are not greedy monopolists keeping prices high because they want to milk their position. Game companies keep prices high because they are afraid of losing money.
A few gaming realities. %50 or more of a game's total sales will happen during the first two months of a game's release. This demand is relatively inflexible, and will not generally go up if you decrease the price. As they age, price becomes more of an issue for impulse purchases, though not generally for the people who have mentally chosen the game. As impulse purchase games are likely to be the "greatest hits," unless your game has some serious name recognition, it is in your best interest to sell to the choir who will purchase it at full or near full price.
Assuming the retailer takes half, and half of what remains goes to paying the developer, for cheap 2.5 million dollar game to break even it needs to take in 10 million overall, or 5 million in the first two months. 5 million dollars is 100,000 copies during the first two months, assuming $50 per copy. Compared to movie tickets that's somewhat small, but for the pool of gaming that's pretty large.
A given metropolitan area will have one to three game-specific stores where the cash registers ring every few minutes. They will also have music and mega stores where one can purchase games, but sitting down and watching that section for a day is like watching paint dry. On the other hand, there are at least 7 theaters here in boston, and those ticket counters almost always have a line. If you talk to your co-workers, the launch of Return of the King has entered public consciousness, but Metroid Prime barely registeres.
We're in a small pool, in other words. To stay afloat, game companies need to keep prices high. I would like to believe that lower prices would increase demand, but I have seen companies attempt to go down that route with little success. The fact of the matter is that most people don't play games: they feel they are a "waste of time," and "for kids." One could argue the hipocracy of clinging to the puritanical belief in a lack of wasted effort in a society where the average person watches 4 hours of television per day, but it is (I fear) the latter perception is the more insidious and will only be overcome in a herse.
But gaming companies to listen to sales. A few years back the Playstation 1 had a rigid price structure where every game was $50. Crash Bandicoot 2 was just released at $50, and as such SCEA decided to lower the price of the original to $45 as an experiment. The original Crash sold as well as Crash 2 that year, showing that indeed, price was an issue. From that we have our multi-tiered pricing system of today. Just in case you forget that it has been tried, there was (and remains) a rung on the pricing ladder below "greatest hits." Ball Breakers, and many other games were released at the $10 mark for the original Playstation. Yes, some of them were terrible, but some were rather good. Sadly, the increased sales didn't offset the decreased cost, and that experiment was largely abandoned.
If you want to send a message to publishers, buy games on the cheap. They have no way of knowing that someone just pirated a copy of Max Payne 2 in protest, but they could see a thriving market in used games as a sign that they should lower prices. If there is a hot game coming out for $55 dollars, and an older one that you really
Re:Piracy is GOOD (Score:5, Insightful)
The best way to make money has always been to make a whole lot of something. The somethings get cheaper over time, if for no reasons other than that technology marches along, and that the research costs will eventually taper off to virtual nothingness alongside the cost (and benefit) of production. Only a few people will save up their pennies and buy one thing that will last them a long time. They're distracted by loud noises and flashing lights, and they'll buy the cheap crap. Besides, if you're poor you probably live somewhere where nice shit is in serious danger of being jacked when you're gone for the weekend. I don't even have anything particularly nice (Just a bunch of medium-nice things) and a whole bunch of not worth stealing items that a junkie would probably run off with anyway, and I'm concerned about my belongings. Don't give me that look when I say Junkie, this is a town that both makes and takes an awful lot of speed.
Oh and stop bringing up Hitler. No one's getting out the Zyklon B. Commercial copyright violation surely deprives people of money and devalues their product, but the only reason they're upset about the latter is that it typically has little intrinsic value to begin with. They simply hype it up until it has spin value. Then they spin up the next thing and send it our way. They're treating us like pigs out for slop, and that's what we get, because we'll eat it... certainly this relationship works both ways.
There are basically two ways you can go to fight them. You can go both ways at once, too. One way is to produce or promote (either with effort or money) independent media. You can buy shareware games, you can buy indie CDs, etc etc. And you can be a "pirate". One way is legal, one way isn't. One way is clearly moral, one way is murkier, but there's really no proof that anyone's getting hurt. It seems to usually be a good thing for artists; there are exceptions I'm sure but they seem to be in the minority.
I think we can all agree that the saying about how people wouldn't buy the software anyway is about fifty percent bullshit. It's just easier to download music and not pay for it than it is to go to the store and find out your chosen music is out of fashion this week and they'd have to order it for you. The music industry has been promising us custom CDs for ages but they never have been able to agree on how to cooperate. Piracy has simply forced them to start selling music online, or be left behind. In this case it has driven progress; the technology has been there for some time, in fact it's a cheaper way to distribute music than making CDs in some central location and shipping them.
Assorted businesses are now having to come up with new things to charge for, new items to market. Technology does that. People want information to be free, and conciously or subconsciously, they work toward that end. There are notable exceptions who have discovered ways to make money off making it not free.
Naming conventions for piracy (Score:5, Funny)
From now on, all official BSA pronouncements will obide by a new naming scheme. Opponents of BSA will be referred to as "digital terrorists", "hackers", and "pedophiles", preferably in the same sentence
Piracy does lower inflated lower prices (Score:5, Interesting)
It's only for products that are correctly priced that prices will rise, because costs will rise enough that the company can't afford not to raise prices. For products which have previously held monopoly-like protection, piracy essentially serves as market competition. I'd tend to think that video games are a competitive enough market that this doesn't apply here -- chances are it's just going to raise the price of games in Western markets, and the revenue from China will just be treated as found money -- but there certainly are cases where we've seen piracy lower prices.
Money grubbing bastards (Score:4, Interesting)
And the most obvious answer is they're money grubbing bastards, which is why I'm happily pirating games. Prove me wrong and maybe I'll stop.
Re:Money grubbing bastards (Score:4, Insightful)
AS usual, control over the distribution channels is where the money's at. It's the 1600's in England all over again. Guess what law they created to break the monopoly that the distributors had over the profits from publishing
Re:Money grubbing bastards (Score:4, Insightful)
The problem comes in when you see how the costs are divided. A modern game will cost millions of dollars in one-time costs, but it costs maybe fifty cents per unit to actually duplicate the disc and produce the packaging. This means that, unless the game is popular beyond all belief, the one-time costs dominate, and so the game's price has to be set much higher than the per-unit cost in order to make money overall.
The thing is, once your one-time costs are paid for, they're done. No more worries. Introducing games into, say, China, comes with nearly no one-time costs. They have a bit of marketing to do, and they'll probably want to do a translation, but these are very cheap compared to the original production costs of the game. Since those have already been paid for by customers in Japan, the US, and Europe, you can sell the game at a much lower price, the per-unit cost plus a markup.
Pricing is a fundamental difficulty in industries like this, including software, music, film, and drugs, because in all of these industries the one-time costs are way higher than the per-unit costs. But the market doesn't like paying a large markup. People know that the $12 CD they just bought only cost 25 cents to make, and they don't like that.
All of these industries see pricing structures like this. You spend a lot of money to create a product, then sell it at a very large markup in your primary market, which consists of people used to paying higher prices. Once your one-time costs are paid off, you can sell the same product for a much lower price in your secondary markets, and continue to make a profit. This happens with software, drugs, and media.
It is not about piracy! (Score:5, Informative)
What next, Sony reduces the price of PS2 games in Africa by a factor of 100 compared with US! If a the average household income of a country in Africa and China is say $1000. How the heck do you think they are going to buy a $50 game? Be realistic. People pay rent in those countries for say $10-$15 a month. What in the world will justify them to pay $40-$50 for a game? It is not fair to charge them $50 and deprive them, at the same time, yall will feel it is not fair to charge you $50 and charge them $5.
This is all about what the market can afford. Even if there was no piracy, the prices will be far more cheaper, else they will only be selling 100 games a month. China has population, imagine if they can get to sell to 250,000,000 people at only $2. That's some major money right there!
Re:It is not about piracy! (Score:4, Insightful)
Academic studies of software piracy? (Score:2)
not only China, Eastern Europe too (Score:5, Interesting)
1 cd (game, productivity, OS - no difference): 2-3 euro.
1 cd (movies, mp3) - 1 euro.
licensed copy of windows XP - 100 euro.
licensed, localised, new PC game from upper shelf - 30 euro.
licensed game from bottom shelf - 12-15 euro.
ticket to the new hollywood movie - 3 euro.
new SF book - 8 euro
cost of hiring a room for student - 60 euro.
most people earn here about 250 euro monthly. (like math teacher, policemen, nurse...); best untergraduates can get 80-100 euro.
I suppose reality in China is much closer to ours, than yours
[sorry for my bad english]
Anyone remember Cartridges??? (Score:2)
Piracy is 100% the fault of the console manufacturers.
In an effort to save money over expensive-to-manufacture game cartridges, the industry moved to standard recordable media which had been "theft proofed" or reformatted for a specific console.
Historically copy-protection has always been defeatable and likely always will be unless a hardware component (or network aware system) is employed. Console manufacturers knew this well, and when they should have listened to the warnings of their engineers -- they
Re:Anyone remember Cartridges??? (Score:3, Informative)
The "more sales - lower price"-argument is flawed (Score:4, Interesting)
For me this has always been a flawed argument. It is economical theory: If somebody sells more of a product they will just reap the profits, not lower the prices to fix their profits at a certain (low) point. It is not like a company will go: "Damm, we are really selling a lot, lets lower to price so we don't earn too much money".
If more people bought original games it would only mean that game companies would earn more money, not that the prices on games would change. It would probably have the side effect, though, of more games being produced as more companies would be willing to enter an industry where there is profit to be gained.
As a real-world example we can just look at some of the PC top-sellers, like for example Quake 3. This game was relatively cheap to develop and everybody knew that it was gonna sell a shitload of copies. Does that mean it was sold at a lower price? Of course not, it just means that ID Software would earn more money.
We want it for FREEEEEE (Score:4, Interesting)
Water comes out of the sky for free. When it's bottled it's a $5 billion industry.
Piracy will have very little effect on the market.
Golden Times of 8-bit Atari (Score:5, Insightful)
Shortly after capitalism was introduced in Poland, many software companies emerged, producing games for most common computers - primarily 8-bit Atari. I was a lucky owner of one at that time, and I recall that times with some nostalgy.
Multitude of games was written. Some of them really exceptional. Spy Master, platform game with built-in 'DOS' in which you could launch mini-games from floppies you found thorough the game. Viki, a game with over 1000 rooms (on 64K RAM!), Barahir, really exceptional graphics, 'Dwie Wieze', gfx imported from Amiga, many, many more.
And the companies were pretty successful, despite the fact piracy was widespread and legal. How?
The games always did have some copy-protection scheme, but not uncrackable one. More skilled pirates did circumvent it. BUT the games were released at prices very comparable to the pirates. Usually one game costed the same as one disk (with 5 or so games) from a pirate. And people were buying them, because they were very available at affordable prices, and every Atari user held it as a point of honour to support the authors... Well, with exception: games that sucked
Time passed, Atari died and even best Atari games couldn't compete with Amigas and PCs. No local 'scene' for games for such appeared - all was either import or pirates.
Once originals prices suddenly rose from like, 3 zl (our prices) to 100 zl (western prices), sales suddenly died. Despite introduced anti-piracy law, piracy was more widespread than ever before. It just wasn't legal, small firms that made profit on it, just mafia sindicates. Hardly anybody buys originals nowadays. "We suffer from low sales because of piracy" claim the releasers and increase the prices more to increase profit from the few games they sell even more. And users, just pissed off, "How DARE they to demand such money for that", just buy pirated games instead.
And almost nobody remembers that selling and buying original games in Poland at one time was not only very comon, but quite profitable - and the key was LOW PRICES.
Makes good sense (Score:3, Insightful)
When prices are high, piracy/theft/ect are going to be high aswell. When prices are low, the same things are going to be low. Why do you think the p2p networks are so huge? Because people's opinions differ from buisnesses and the goverments , just about every one of them infact.
The really sad part about this is that if the trend continues with people thinking that piracy is ok, xyz gaming corp will creat an awesome game and nobody will buy it, and they'll go out of buisness instead of making new games. After the RIAA and MPAA are deceased, cd's are cheaply baught at $2 and $3 a cd with extra's and a movie is around $5 opening night. Will piracy decrease or will it continue to rise?
As for software, I'll agree as much with the next guy that when I go into a store and buy a software package and it sucks, I'm pissed and can't return it. As for games, there's a lot of cookie-cutting going on as there always has been in the computer industry. Doom came out, and then you got blake stone, duke nukem, etc. BF1942 came out, and now we've got mohaa and it's expansions, ET, call of duty. All of them are based off of the same engine (afaik) and all of them have similar gameplay.
My worries aren't the monumental failures when corperations spend millions building a cookie cutter game and loose millions. My worries are when xyz corp creats the super ultra neato game and puts it out and the overall reputation and respect for gaming softare is so low that nobody will buy it for fear that, even though there's hype in the magazines, hype in the stores, hype in the forums and hype in the news and even a good playable demo (which everyone knows is bribed because they'v been burned before) will xyz corp be able to make any money for making a truely excellent game? Will xyz corp go out of buisness?
Cartels like the riaa make a bad name for companies like xyz corp. The major reason people go out and buy anything is because they think it is good, well, if they're a thinking consumer.
Re:Makes good sense (Score:3, Interesting)
Perhaps the execs at XYZ should consider an alternative to spending tons of money on the development of "Neat-O" as a sealed product.
Instead, they could:
- Develop a detailed plan-pilot-concept of how "Neat-O" should look and play.
- Sell ten or so "Neat-O" original developer subscrip
Old Games (Score:5, Insightful)
We've always been told... (Score:3, Interesting)
A bunch of thieves (pirates) being lied to by a bunch of liars (publishers.) What's this "we" white man? I was never naive enough to believe what I have been "told" on this subject. What is said to discourage theft and what is done to sell products are two distinct matters.
but doesn't this news suggest that piracy in China has in fact pushed prices down?
This so called "news" suggests a lot of things, one of which is that publishers are attempting to establish themselves is a market on the hope that one day in the not too distant future that market will grow up and be worthwhile. It also suggests that, like the drug industry, there is a massive price differential between the US and everyone else. Of course, Chinese street vendors probably do not sell shelf space by the square centimeter, either. Much is suggested by this, and attributing all of it to the minor matter of thwarting piracy is either naive or dishonest.
Sounds like a breakthrough in economy (Score:3, Funny)
Mass Marketing (Score:3, Insightful)
Its this business model that fuels the majority of piracy in North America.. If a game were 25$ and I could walk and pick it up in 15 mins at the game store near by.. Or spend 1-2 days downloading it... I would rather pay the 25$ if the company/game had a good rep for playability.
Its hard to shell out 40-80$ for a game that may only have 2-3 days of playibility to it. That also fuels piracy... So they have a few obstices to overcome in that reguard.
Price comparisons direct from China (Score:5, Interesting)
Not sure where I'm going with this, but thought it might be interesting.
Charging more (Score:5, Insightful)
So Sony is raising the price of PlayStation 2 in China and lowering the price of the games.
I'll restate this for the reasoning impaired: They're taking their money upfront on the console, rather than later on the games.
Not applied to the right market (Score:5, Insightful)
Still, it's backwards. High prices encourage "piracy". And lowering the prices enough will make casual users of illegally copied material say, "hey, it's more convenient to just buy it." Of course, there still has to be some enforcement of copyright for this to work. I see hints of this happening in the music biz, but I've yet to see real price competition between labels. Thank heavens we are seeing a real-world example of this, and hopefully it will give the anti-entertainment-cartel crowd some ammunition.
A little knowledge is a dangerous thing (Score:3, Insightful)
For this article, the misleading economic argument is that piracy has lead to lower prices and that this is a justifiable result of piracy as competition.
First off, there are two basic types of costs driving the gaming industry: fixed and marginal. Fixed cost is the development and marketing cost incurred by Sony and the developers whose value roughly does not vary with the number of sales they make (obviously, the fixed cost differs if you plan to sell 1 million copies as opposed to 100
For most console games (if successful), the fixed cost are recovered during the initial sales in fully developed countries with defined property rights, namely U.S., Japan, and Western Europe. Economics shows that once fixed costs are recovered, competition can drive prices such that they reflect only marginal cost
However, at P=MC, fixed costs cannot be recovered. While P=MC may be a competitive outcome in the short-run, with the fixed costs of existing games already sunk, it is not a long-run equilibrium as no firm would continue to operate under the prospect of not fully recovering it's fixed cost. Note: the fixed cost is often referred to as "capital cost" in some popular press
Of course, this applies to other published products such as movies, books, CDs. This is why we see reduced prices for these items later on, after their initial release (bargain bin books/paperbacks, "budget price CDs," and second-run films): the idea here is that firms can charge closer to marginal price now because they had already largely recovered their fixed costs earlier with the more expensive first-run products.
So the lesson for console games and China? Sony and Nintendo are willing to charge lower prices in China precisely because they were able to charge higher prices in the U.S., Japan, Europe earlier. This is also the same reason why pharmaceuticals are (sometimes) willing to offer drugs to Africa at a much reduced price (they're much less worried about drug "piracy"
That said, are prices in these traditional publishing industries "too high" ? Absolutely. But let's use the right arguments instead of simply trying to legitimize piracy.
it comes down to simple economics (Score:3, Insightful)
For instance, if you make a single player game, and sell it in stores for $50, with the CD in a jewel case, no manual or game material (such as the books, maps, etc. that come with Baldur's Gate games), and just a couple pictures on the box, people have absolutely no motivation to purchase the game over pirating it. There's no functional difference, and there's hardly any perceived difference. The cost of finding it online (at most, several hours of searching online and then maybe a couple days downloading it - basically just your time to find it: say, 4 hours), or the cost of getting it from your friend or the guy down the street for a couple dollars, is negligable compared to the 50$ box price.
There are several things that companies can do to increase both revenue and sales. Part of the equation is lowering the price so the investment differential between a pirated copy and a legit copy is less. The other half of the equation is providing game content that doesn't suck.
Let's draw this scenario up in terms of the price of the product. On the 'buying legit' side, I would likely have to download a 200+Mb demo to find out if i like the game, play the demo, (and if I like it) go to the store, buy the game, come home, uninstall the demo, install the game, and (likely) play over the same exact part of the game that was available in the demo - and that's just not cool. I spend $50 of my money and invest (say) 3 hours of my time to get this game. I could also have just gone out and gotten the game and then been disappointed, and returned it, or not gotten the game at all after playing their wretched demo.
On the pirating side of things, I could see an add for a game, read a review or two, and then either ask a friend for the game, or search the web for a little while for the full version - obscenely easy. I might invest a total of 4 hours of active seeking in trying to get the game. I'll install it, and if I like it, I'll keep playing it. At this point, I have no desire to pay for it, since i already have it, and buying it offers me no added benefit (more times than not). If the game sucks (which is much more than likely nowadays) I'll simply remove it and have only lost (say) 5 or so hours of my time. This second approach is the one that seems to be the most common among gamers in my experience: they're a highly social group of folks amongst themselves, and getting an ISO or CD from a friend is much easier and a LOT cheaper than going to the store to buy it, and there's much more benefit.
Neither of these options seem terribly viable for the game producer, in my mind. Here are several options that, too me, seem to be much more viable - either by themselves or in combintion.
1) Sell the games for a lot less money - $15 or $20, or maybe even $10 seems reasonable to me for most of the games out there. I'm much more likely to go to the store and pick out a cheap game for the hell of it on a rainy Saturday than I am ot pick out a $40 or $50 game. I, as well as most gamers aren't diehard gamers, and aren't willing ot spend an arm and a leg for a game unless it warrants it.
2) Provide some sort of positive incentive to purchase the game. Note: the incentive must be positive! This means that throwing in some sort of 'required license key registration' into the installation process would not be a good idea. Instead, go the extra step (it's just a step, when you consider it, compared to the initial mile of actual development) and add some content into the box: maybe a sticker or two, maybe a poster, a nice game manual (whether the game needs it or not, if the game is good, people will read those manuals), and various other "we care about you" gestures. Adding in a license key requirement to get to the more significant part o
Where the money goes (Score:4, Interesting)
Here's one for all of y'all "games are overpriced!" folks.
First of all, a console game has three groups who'd like to have their share of the sale:
1. The developer, obviously. Ironically, the developer does the hardest work and gets the tiniest slice - by far.
2. The publisher. Takes the bulk of the money. I hate to see those greedy tie-wearing dipshits get rich off what developers make, but then again, publishers front the entire development costs. And you guys don't have the slightest idea how many projects do NOT get released. I have spent a total of more than three years working on projects that got scrapped. Just try to calculate how much money went down the drain there. So good projects have to pay for cancelled projects.
3. Sony/Nintendo/Microsoft. For every media produced, Sony (PS2) or Nintendo (GC) want a substantial (!) amount of money. The thing is, they make barely any money through the consoles (just think about how much you'd pay for a PC with that kind of processing power) - the real money lies in the sale of games. So here they are and open up their hands. Naturally, they want money for every CD *produced*, not *sold*. Once again, the publisher is the one sucking it up if a game doesn't sell well.
Yeah, games are expensive, but not overpriced.
Re:We need a face-off with china now (Score:2, Insightful)