How Console Piracy Affects Gaming

Thanks to GameSpy for posting a three-part article discussing the problems of pirated console games, and the steps being taken to combat the problem. The article talks to IDSA boss Doug Lowenstein, and suggests that "..console piracy is a worldwide industry, as multi-national as wireless telephones or McDonalds hamburgers.", also contrasting the piracy problems of the major manufacturers: "Nintendo's piracy problems are more localized than those of Sony and Microsoft. While GameCube piracy has not been a problem, Game Boy piracy, on the other hand, has proliferated."

Comments

Profit source

[DrWho520]

One thing to remember in all of this is where these companies get their profits. Profit is not made on selling systems, but on selling and licensing games. The X-Box costs about $300-400 a pop to produce (don't quote me on that). MS loses money on each X-Box they sell. I do not know about Sony or Nintendo, but they may sell at or below cost as well. You have probably read the business philosophy, "Give away the razors, sell the hell out of the blades." They give away the consoles and sell the games. Nobody pirates the consoles, they pirate the games, and that's where the profit comes from.