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Sony vs Modchips
Cryptnotic writes "Sony
has decided to instigate legal action against companies distributing two new Playstation 2 modchips, the Messiah and the NEO4. Sony has previously ignored modchip makers who made products which were only capable of playing CD-R copies of games. These new modchips, however, have legitimate uses, such as playing original import games or out-of-region DVD's. Aparrantly this is what has angered Sony." If I could read Kanji I'd probably care a bit more ;)
- The only reason I would buy, or make, a chip would be to play legally-bought imports, because:
- Some PAL conversions suck.
- Some games never even get released here! (ala Tsugunai)
- The ever-present release/conversion delay.
- Prices
- I wouldn't, but with this in mind, and a chip installed, other people might be more tempted to buy illegal or counterfeit copies, since they already have the chip to run them.
- (So) buy basically forcing me to chip my playstation to play legally[1] imported games, they may well have increased piracy... Ooops.
[1] My PS2 is legally bought, my imports (would be) legally bought, all my games and peripherals are Sony branded, yet I cannot play games I legally buy. The same stupid situation exists with DVDs.Thats all very well but both of the modchip suppliers mentioned in the article were based in the UK. Now it may have escaped my notice but I don't think we've had any precedent layed down over the DMCA ;)
You really should read actsofgord, which explains this nicely. There are two sorts of modchips: the ones that defeat copy protection, and the ones that defeat region protection. The latter are what we're talking about; the only use for them is playing legitimate, bought-and-paid-for games from different regions.
There is only one reason to have region "protection", and that's simply control. The only thing I can see this gains for companies is by letting them use this artificial monopoly to increase the price in certain regions. Technological controls keep them from importing. This is not a copyright-protection issue. It is only an issue of control and artificial price inflation.
I have a PS2 (not to mention lots of peripherals and 15 legitimate games I paid full price for, not to mention the load of legitimate PSX games I also bought), and I love the games, and I'd love to import stuff. Sony's wanting to rip another $400+ out of me for an import PS2 is just pure greed. They lost against Bleem, I hope they lose here, too.
I love the games. I want the games. But this is ridiculous.
Don't think of it as a flame---it's more like an argument that does 3d6 fire damage
You'd be much better off encouraging people to buy PS2s and use them solely as DVD players - Sony subsidises the consoles quite heavily.
Cartels that artificially control prices and distribution may be legal, but many people, myself included, believe that they are wrong. Slavery, prohibition, and preventing women from voting were all legal once in the U.S.
And there are plenty of instances where "copy protection" causes problems for legitimate users. I've had many rented VHS tapes with Macrovision where the tracking was screwed up. Some of my games require me to have a CD in the drive even though I installed everything on the hard disk. I do not copy these things. I paid for them legitimately.
-Kevin
I mean, geez, if Sony doesn't want me hacking up it's [sic] boxes, why did it _sell_ them to me? Come on Sony, ligthen up!
Now that's rich. "I mean, geez, if Pac Bell doesn't want me phone phreaking, why did they _sell_ me a phone line? Come on, Pac Bell, lighten up!".
FYI: Sony doesn't make money off the boxes, they make money off sold games.
Modchip = #1 way to enable piracy for the masses = immense loss of profit for Sony AND game developers AND publishers. And since I'm in that group, I can say that Sony, by trying to get rid of modchips, promotes security for my very job.
It doesn't make any sense. Modchips help sales of the psx and ps2..why kill them? I doubt sony is under any legal obligation to make sure that the hardware they SELL to people is being used for legitamte purposes (ie. for playing properly-regioned DVDs). shouldn't it be the responsibility of the movie makers to go after these dvd playing chips?
Bzzt. There's no law that prevents you from importing software that is otherwise legal.
Except the EULA printed on the back of the box: "Licensed for use only with products bearing the PlayStation logo and [NTSC|U/C] designation." Any other use violates the patents on the PlayStation hardware.
even if they are subject to licenses, which is certainly fairly doubtful
The console licenses are more explicit than PC software EULAs, as the terms for consoles and games are printed right on the back of the package, next to the UPC symbol, as opposed to being hidden inside the shrinkwrapped box like PC software licenses.
the validity of the licenses themselves are in doubt
Even that doesn't prevent Sony from abusing the legal system, filing frivolous lawsuits against small businesses in order to run up the small businesses' legal bills. The legal system is broken, and Congress has shown itself to be too bought to fix it.
Will I retire or break 10K?
...especially if it is HARDWARE!
If a "mod chip" is all that it takes to play "pirated" software, maybe they need to take a look at their copy protection scheme...
My question is whether the "regional issue" involves pricing or something else? Are titles selling at a price commensurate with the local economy? Would Sony LOSE money if these titles were imported through the "grey market" ? Or are they trying to protect the distribution infrastructure of various countries?
Imagine the implications if a company like Sony used virtually NO copyprotection and sold an item at a reasonable price... might not the sheer increase in volume of sales off-set the marginal effects of piracy? People have a finite amount of money they spend on games, music, movies, whatever... and the price merely determines HOW MANY of these items you actually purchase (for a relatively honest consumer). The same companies receive the same amounts of money (it's not like there are that many companies involved).
Whenever people talk about how much money is LOST to piracy, I always am left thinking that the money was never there in the first place- that those "pirates" would never have purchased the item anyway... so protection does more to piss off honest consumers than to increase revenue. How many ordinary people actually take the time or effort to mod a console (or overclock a PC) ?
Finally, if this regional protection issue gets out of hand, we'll all be purchasing items that will eventually only play on one machine.
Those that suggest you "dance like no one is watching" really want to see you make a complete fool of yourself.
Actually, this is a case of things happening exactly how Sony wants. Here's how I see it:
Up until now, Sony has had a tough time with modchips. Each time a new one is released, they release a new way of detecting the modchip to game developers. Game developers add this check, and that modchip is defeated.
Every time a modchip is defeated, the end-user has to upgrade their modchip. Now if every user has to upgrade every time they get a new game, how often do you think it's going to be before the end-user finally gets ticked off at upgrading, and just switches to buying legit copies?
Additionally, think about this; newer games can detect old modchips. So if you have an old modchip, you can't play newer games, even if you buy them legit. Now you're forced to choose between modchip and legit.
This is what Sony's counting on; people "wasting" so much money on modchip upgrades that they go straight. If you can't buy a modchip and have it last, then you may as well not buy the modchip, right?
Enter the Messiah and NEO4. (the latter potentially; I'm not sure if it works the same way) The Messiah is a one-time upgrade that fixes your PS2 for the lifetime of the system. From what I understand, they've placed the chip in such a place that newer Sony games can't easily detect it's presence.
Sony can no longer rely on people getting tired of upgrading modchips--now they have a problem. This is where the DMCA comes in.
Arguably, this is how Sony wanted it all along. Sue them back into the stone age, using their newly-bought DMCA. Of course, they could've used this tactic at any time, but the ability to piss off pirates with a constant "upgrade your modchip" routine probably greatly amused/satisfied the people at Sony. Now that they're no longer able to do that, they'll use the more expensive--yet reliable--method of just suing them into the ground.
It's been in Sony's best interests to wait to sue, btw, because there now exists legal prescedent for using the DMCA. Before, it could've been hairy..
The DMCA carries a "prohibition on circumvention of technological measures that control access to copyrighted works," which would almost certainly apply to modchips.
Therefore, the use of such devices is not "legitimate" or legal. Period.
I'm not in favor of the law, but it is the law.
I survived the Dick Cheney Presidency 7 to 9 AM 7-21-07
God damnit, where the fuck do people get these idiotic ideas!? Import games illegal? out of region DVDs illegal? WTF?! Despite what you might think, and what I'm sure the RIAA and MPAA would love, the law does not exist solely to increase corporate profits.
autopr0n is like, down and stuff.
The "blast processing" argument was to show how people will often believe something if they hear it enough times. Who knows how many things I believe to be true simply because they are outside my realm of immediate knowledge. Though for this debate, I do believe I am very much in right.
I would agree that the console market has gotten very expensive to produce a console. The days of when everyone went down to RadioShack, bought some parts, and sold it as a console are now pretty much over.
If memory serves, from 1993 to 1994 we had 14 consoles introduced into the market (Jaguar, 3DO, PlayStation, Saturn, CD-32, NeoGeoCD, PC-FX, 32X, hmm.... memory failure). Well, I have the number 14 in my head. Anyway, there were a lot of consoles coming out in the early 90's. And all were pretty much off the shelf parts.
The PlayStation pretty much ended that era. Suddenly Sony wasn't playing by the rules, and this gave them a huge advantage. Further, SGI wanted to sell their console idea and they floated it around, and eventually Nintendo picked it up and packaged it as the N64. (old interviews in Next Gen magazine with SGI said they offered it to Sega, but Sega declined).
Anyway, that takes us to today. For a console to have a shot, it's got to be bleeding edge. It's got to make us stand up and go "damn that's pretty". To do that costs a lot money.
Nintendo, MS, and Sony all spent a lot of money on their consoles before the first one were made. How much? A hell of a lot more money than I have.
Then we enter the production phase. MS and Nintendo have outsourced for all their parts. It is by far a cheaper way to do things, though it costs more in the long run.
Sony on the other hand is walking into this console generation with all hands saying they will win. They can afford to spend billions building facilities to make PS2 parts, and that they did. Over $2B!
Now, let's go do some math.
Let's assume that the cost of a PS2 if $300US. We'll also pretend that Sony sets all sorts of records. They'll hit 100M sales by the end of 2004, and a billion games by then too.
Assuming they hit a billion games by then, they will have earned $6 billion in royalties. That is the magic number. $6B.
Now, from this $6B, we take away the $2B they have already spent on new facilities. THat leaves $4B. Ok, $4B in the bank.
Next, advertising. Sony spend over half a billion annually on PlayStation brand promotions. We'll round down to $2B for the sake of argument. That leaves $2B in the bank.
Ok, Sony is now sitting at $2B in the bank after a 4 year worldwide record run of the PS2. And that's assuming the machine is a breakeven.
Right now the PS2 is $240US in Japan. Now Japan, and $280US in Europe. Let's say all three regions sell equally, that brings a mean price of $273 per console. That would mean Sony is losing $27 per console now. Assuming we keep this loss average over the course of the life of the console, that would be 2.7B.
Sony just lost $700M assuming the PS2 is a breakeven at $300. And that still doesn't cover what Sony spent actually designing the machine up.
Let's go better! Let's say the popular price of $350 is the cost. So Sony is losing $77 be console on average. Assuming this was the average for the life of the console, Sony would have just lost $5.7B.
Hell, assuming that Sony is losing $77 per console now, even if they were to reduce the cost of the machine every month by $10 a month, Sony would still never post a profit from the PS2, assuming Sony sticks to regularly scheduled price drops of the retail price.
And this still doesn't factor in how the PS2 cost more to design as Sony designed all the parts in it.
The financial arguement that Sony is losing money does not make sense. With Nintendo and MS it does, because they have outsourced. They didn't spend an extra $2B+ up front. Instead they are paying a premium to use someone elses parts and to use someone elses facilties to build their machines.
Which brings us back to the stock fraud arguement. It does not make sense that Sony would hide not only losses from the PS2 from investers to gain a marketshare in which they will continue to lose money, but to then pay dividends on that money they claimed? That further pushes up the loses.
Further, according to Sony's quarterly stock filing, they have $7.6B in cash and cash equivelants on hand. That just isn't enough to carry the kind of losses that everyone is expecting the PS2 to lose.
It also states Sony spent $2B in that quarter on cost of goods as well as advertising and other such ongoing expenses during that quarter in the SCE department. Sony sold 4.62M PS2's and they also also sold 2.37M PS1's.
Assuming we go with the $80 for PS1's ($189M), and $300 for PS2's ($1.407B), that brings a total of $1.596B. Then we add in things like advertising ($100M+ to we're at $1.7B), wages (assuming SCE has only 5000 employees, that would be $100M a month). And boom. We're already at the total money spent without adding in extra things like phone calls, rent, electricity, travel expenses, cost on extra things like controllers, etc, etc. And this is assuming the PS2 is sold at cost!
The cash argument does not make sense either in the long term or the short term.
As for my view on the XBox and GC, it's simple market and consumer buying patterns at work. There has been no change in the level of support the PS2 has, and consumers have no compelling reason to forgo buying a PS2 to buy any of the other two consoles.
It's possible to like something and be critical of it. I'm just being a realist. Further, the PS2 still continues to dominate the GC and Xbox on daily sales. As such, the PS2 will continue to get the most games, and by default the most consumers. It's a vicious cycle.
And as it now stands, I don't see how MS or Nintendo can overthrow the PS2 juggernaught.
As for the site, just for you I'll get on my ass and do an update by Thursday. Just because I love you! I'll bring on the funny!
I'm not sure about your analysis of the economics of the PS2, so I'll accept them as likely to be true. However, I don't believe in your assertion that the PS2 is garaunteed to dominate. I think you are forgetting about just how much most developers despise the PS2 (allegedly, of course).
The way I can see SONY losing its console crown is through a developer migration to the XBox and GC, two system deisgned to be developer friendly. If the majority of developers migrate to either of these platforms as their primary target, that relegates the PS2 to second fiddle status which will make it less desireable in the eyes of gamers.
The reason I can see developers migrating to the GC or Xbox is because the can maximize profits per unit sold on those platforms. If they are easier platforms to develop on, then developers will take advantage of the reduced production times which means much less expense which in turn means greater profit margins.
Sure, they can go for the high grosses of the PS2, but what if they decide to go for higher margins? Knowing that by concentrating their development efforts on the GC and XBox they will attract more gamers to those platforms. This will eventually mean high gross AND high margins. Win/win for the developers if they switch now.
I'm not saying that they'll simply abandon the PS2, because that would be insane (with it's exceptional installed base). However I can see them relegating it to the status of a porting platfom. The porting duties being handed off to other development houses.
It may be a less likely possibility than PS2 dominance, but I think that it makes the future a lot less certain than you seem to indicate.
-- kwashiorkor --
Leaps in Logic
should not be confused with
Jumping to Conclusions.