Valve's Gabe Newell On Piracy: It's Not a Pricing Problem 466
New submitter silentbrad writes with a followup to our discussion this morning about Ubisoft's claims of overwhelming game piracy. An article at IGN quotes a different point of view from Gabe Newell, CEO of Valve:
"In general, we think there is a fundamental misconception about piracy. Piracy is almost always a service problem and not a pricing problem. For example, if a pirate offers a product anywhere in the world, 24 x 7, purchasable from the convenience of your personal computer, and the legal provider says the product is region-locked, will come to your country 3 months after the U.S. release, and can only be purchased at a brick and mortar store, then the pirate's service is more valuable. Most DRM solutions diminish the value of the product by either directly restricting a customers use or by creating uncertainty."
The quote was taken from an interview at The Cambridge Student Online, in which Newell speaks to a few other subjects, such as creating games for multiple platforms and e-sports.
Too true (Score:5, Interesting)
I was about to buy a copy of GTA IV on Steam during the sale they've got going. With credit card in hand, I found out in some reviews that the PC version requires Games for Windows Live for saving and installs SecuROM. Dealbreaker right there and I never purchased.
Pricing is a factor too .... (Score:4, Interesting)
When the pricing of a software package gets to be too outrageous (not in terms of value but simply compared to how much cash one has on hand), then pricing becomes a significant issue as well. For example, a graphical WYSIWYG HTML editor, a graphics editor, a text layout tool, a math package, etc. each for $400 makes it quite difficult to afford the software. Most people are willing to lay down some sizeable dough for one program but, when you need to lay out $400 for your office package and 10 others each of which will need upgrades for $200 in several years it gets to be an investment that is not very workable.
OTOH, if the same software were available 24/7 for immediate download (with no support unless paid for) for a much reduced price -- say $50, the quantities sold will be much higher and the software company can reduce its costs by eliminating Best Buy and a host of other stores that take 50% off the top anyway. Additionally, there is no packaging, manuals, DVDs, etc. that need to be printed / burned nor shipping. The costs for the software company will go down and their sales will go up. I might be even tempted to try software that I wouldn't ordinarily buy simply because the software is not cost prohibitive.
The Apple Appstore is really a good example of this. Yes, the software is underpriced compared to an office package on your office PC but it does drive home that you don't need to charge $40 for a game and you can do it for a $1.00 instead -- a 40 fold price reduction. Oh, yea, Angry Birds has about 500 Million downloads now .... If Photoshop were $10 - $20 and available for instant download, I suspect that Adobe could make a lot more than they do. Especially when they double charge you by printing the "manual" in book form and then your having to buy it from the Last Bookstore in America.....
More lies from gabe... (Score:3, Interesting)
... sorry but pricing is a major issue. How this man cannot say that it is't when games go on sale for 75% off on his site frequently seems ludicrous. The big things effecting modern games are:
1) Game quality
2) DRM
3) Buyers avoiding paying more then $15-20 for DRM laden crap they don't own.
Lots of people avoid buying games entirely because of DRM and low game quality. There are those of us who buy games at extremely deep discounts (5-15$ at most) on steam because of DRM we refuse to pay full price for DRM infested games that we don't own but we do want to support PC developers and have few alternatives since many small developers release on steam.
Gabe has done a lot of marketing to brainwash people and get people to thinking he's a good guy but he's not, if he was the good guy games would deprecate their DRM after a year and the exe's unhooked from steam. The purpose of steam is to datamine users for 'business reasons' and he's putting this massive spin his datamining operation. This means more metrics driven game development as if we didn't have this enough of this alread with the constant clones every year.
Re:Hmmm (Score:5, Interesting)
You're right it's not their responsibility to do that. But not for the reason that you think, they've unleashed this pox upon the gaming community, but it isn't their responsibility because their responsibility is purely to the shareholders.
Just like how there's no guarantee that they won't at some future time take everybody's games away or require a subscription to access them.
Corporate suicide is not in the best interest of the shareholders. And if you read the article, (Asking a lot I know) you will find Gabe saying that actually serving your customers IS in the best interest of the shareholders.
benefit to others (Score:2, Interesting)
Corporate suicide is not in the best interest of the shareholders. And if you read the article, (Asking a lot I know) you will find Gabe saying that actually serving your customers IS in the best interest of the shareholders.
No one prospers unless he renders benefit to others.
-- Tadao Yoshida, founder YKK zippers
Re:Of course it's a service problem... (Score:5, Interesting)
I agree completely.
Check this out.... I played bf2 so seriously and competitively that my clan has won a world championship (TGL 8v8). My clan, including me, has been awaiting bf3 for years. It recently came out, and I still don't own it.... they require you dl and install EA's clone of steam and run it alongsde the game, and then the server browser uses an external web browser...... uhhhh.. no.
I won't accept that trash. Game looks awesome, and I very highly anticipated it (having spent thousands of hours on the predecessors)..... but they're asking too much of me. I will pay an extra $5 on the price if that mde them happy, but in truth they want more from me than I'm willing to give.
I know I'm not the only one to hold out.
Re:Hmmm (Score:5, Interesting)
I smell the EA fiasco in your comment.
Valve got pissed off because of EA's DLC store for bioware games.
EA retaliated by pulling crysis 2 and any future releases not set in contract.
now we have origin. which sucks, but we can't play BF3 without it.
Steam is losing customers at a slow trickle.
I would rather use steam.
Re:Hmmm (Score:5, Interesting)
The reason is that multinational retailers, etc set their prices based on an exchange rate at a specific date, and then don't tend to change it based on the fluctuation of currency exchange rates. This is even more obvious for books in North America - most publishers use the same print for US & Canada, and on paperbacks they list MSRP as something like "$9.95 US, $13.95 CA". That was true in about 1990, but it's $1 US : $0.95 CA today!
In 2009, $1 AUS = $0.60 US Today it's almost 1:1. $80-90 AUS for a game that's $60 US wasn't too bad in 2009, but now it *seems* horrible in comparison.
On the up side, the Australian dollar is kicking ass against most foreign currencies right now, so Australian travelers are getting great deals these days.
It's not like there was 40% deflation in the Australian currency, though, so you no one is going to be too sympathetic. Software may be weirdly priced, but other physical imports should be cheaper. Probably not the best for the domestic tourism industry, though...
Re:Finally somebody understanding piracy (Score:4, Interesting)
Business models aren't even that much of a factor. A trivial case in point -- there are lots of cult TV programs out on DVD in Britain that cannot be obtained anywhere else because of region locking and formatting -- and will never be made available anywhere else. That is not a business model, unless bleeding small markets dry then deliberately killing them is a business model. To me, that's simple perversity.
The US is more... interesting... in that respect. Disney, for example, have released DVDs of some of their US television shows ONLY overseas and not within the US at all (or, when they have, only under extreme pressure and half a decade after everywhere else). Again, what kind of business model is that? It's a blatant attempt to kill a market, which is no business practice I am willing to recognize as a model of anything (except perhaps a Death Star).
My pirate years (Score:4, Interesting)
From my personal experience, I'd say piracy is a pricing AND a service problem. During my student years, I pirated almost every game except a select few I absolutely wanted to have. 50€ was alot of money for me, and downloading something from the internet was more comfortable than getting a copy from a store and sticking the CD in every time I wanted to play. I didn't have Steam back then.
Now I'm using Steam and have a job. I've probably spent around 200-300€ on games this year, taking up many of the special discount offers on Steam, even buying games "legit" that I have pirated CDs lying around. Steam makes it easy, and now that I have the money, I don't think twice about spending 20€ on a game every month or so. From this experience I'd say that piracy has nothing todo with greed, bad intent or trickery. It's just plain lazyness and circumstance. And DRM is a waste of time that only makes things worse for paying customers.
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Re:Hmmm (Score:5, Interesting)
This is a good reason to stick with Steam, and a good chunk of the reason why I refuse to go elsewhere anymore. The remainder had to so with the availability of indie games. Let's face it, there are a lot of indie developers who sell games through Steam and sometimes Steam alone.
Origin? No thanks, not with its horribly invasive nature, and the fact that it's an EA product. Screw that.
I'd like to see the poster you were replying to show statistics backing up his claim that Steam is losing customers in a "slow trickle," but I think he's simply repeating what he's been told. If anything, Steam is probably gaining sales. Every holiday, I buy up a bunch of game packs for family and friends as virtual stocking stuffers. I know I'm not alone.
Re:Hmmm (Score:3, Interesting)
Valve Software is not a corporation. Yes, the name is "Valve Corporation", but they are not actually incorporated under the law. They are an LLC.
Re:Hmmm (Score:5, Interesting)
Re:Hmmm (Score:5, Interesting)
Steam is losing customers at a slow trickle.
[Citation Needed]
Age (Score:3, Interesting)
Comment removed (Score:5, Interesting)