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Game Piracy Results in Lower Prices?
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.
come from competition, not piracy.
When anger rises, think of the consequences.
Confucius (551 BC - 479 BC)
Looks like every should have a good new years resolution this year heh.
Give the government another reason to go to war with china, why don't you.
Piracy lowers prices? The RIAA is gonna be PISSED!
i think that piracy will actually help to sell more. i prefer to have a original boxed game with manuals and stuff than a pirated cd... only if the price is too high.. i'll get the pirated version.
Even if game costs 2$ you can still find release of it on warez sites and p2p networks.
They are pusing down the price to combat the pirated games that's available cheaply, thus puttinng on the cost elsewhere ie. the western world, buy yourself some clue
Well of course more people will consider buying it if the prices are lower the same way they consider not buying when the prices are higher...
and uncontrollable here in the US, it would push the prices down. Most piracy here in the US is of PC games...not exactly the same can of worms, or political situation. Clif
clifgriffin > blog
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.
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!!
I imagine this sort of thing would be considered in the US and other countries were pirated games as widespread as they are in China.
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
>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?
Ever hear of profiteering? 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.
and only capitalism details that IP and copyright are capital goods. Sure, they might make some concessions to attract investment but ultimately if it suits China they'll tear up any agreement to recognise Western-derived copyright. This is how it's always been.
Piracy effectively becomes "exercise of the People's right to pool and share resources".
"It's not your information. It's information about you" - John Ford, Vice President, Equifax
Seriously, though, I prefer to support companies financially when they write a good game for an OS I like. Companies like that should be encouraged.
You are not the customer.
I have never been told that priacy raises prices (exception: pitating ships might raise the price of its cargo in its destination, but still reduce it elsewhere.). If someone told me that piracy raised prices, I would just laugh at him.
lol@CowboyNeal
Don't waste your vote! Vote for whoever you want, unless you live in a swing state it won't matter anyways
China is still a Socialist Nation. Any mention to US companies to lower prices, and they will automaticaly point out that China is not a capitalist nation. Which is pretty far from the truth when you look at their economy. But the argument will still stand, and will stand for a while since the opponents will have less media exposure due to lack of funding. And our prices stay just as they are, most consumers will never even hear about the prices in China if the capitalistic companies here can help it.
Vote for new mod!!! Score:-2,Imbecile
Piracy is whats lowering the price of music CDs accross the country. Piracy is what keeps Microsoft from selling Windows for over $500 a copy to college students. Its piracy that controls a monopoly and prevents the company from setting the price. Please support P2P and piracy so that we can force these monopolys to work via supply and demand. I'll never buy another RIAA CD, but I know alot of people would if they were $5 each
People don't exist to serve systems, systems exist to serve people.
A pirate has come to mean something too cuddly and innocuous. In fact, the loose use of the term to describe otherwise ordinary people engaging in distribution of material copyrighted by others has done much to diminish the proud tradition of "pirate".
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
I think to a certain point, piracy can drive the price of games up. However, if piracy reaches a point where it's so widespread ( IIRC, it's a lot worse in China than here ), then the only thing left to do is lower the prices. It's sort of like an upside down parabola, shifted up and to the right.
The pirated music CD's from China also has CD cover and the lyric booklet. Yeah, it may not be as high quality and artistic as the original music CD cover and booklet, but do you think the mindless teen pop followers care?
Likewise, for those who download games off kazaa, would they care if the pirated game has no manual, or only a black/white photocopied manual?
And why would you want to pay $50 extra just for the pretty box and manual anyway?
I went to see the matrix revolutions which had all those special effects and then some for under $10. Games ARE over priced for sure, because movies cost more to make than games. Music is ridiculously over priced at $20 a CD when they cost less than $1 to make. A good game costs a few million to make and easily makes millions of dollars back if it sells a million copies at $10 a copy. 10x1 million = 10 million dollars, if the game took 3 million to make, thats a nice profit margin.
People don't exist to serve systems, systems exist to serve people.
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?
You are told what you believe.
One of the problems with games and movies today is that the production values are too high .. the risk inherent in rampant piracy should dictate that (if producers of content assume piracy will always exist) you manage the risk by lowering production values and making the product able to compete with piracy on a price point level.
"Old man yells at systemd"
They are not talking about downloading games. They are talking about stores sell bootleg copies. Not only does the consumer get in on piracy in China but retailers, distributers, and manufactures too.
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.
Yeah, look how well the campaign has gone in Iraq.
This shows that they CAN afford to make game prices cheaper. I was led to believe that almost every last penny is going into developing and distributing the product where there is very little profit. This shows that they actually have the power to make games cheaper. So the question now is, 'Why don't they?'
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.
DUH!
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!
------ Curiosity killed the cat. {satisfaction brought it back | it didn't die ignorant | lack of it is killing mankind
does anybody know of academic studies on software piracy? I'd be interested in reading some if people had some pointers.
When console games were cartidges the cost was much higher than CDs. Now you can buy console games for 10 bucks. Piracy is a good price control/ceiling. Go above the ceiling and people pirate, price it just right and people pay. Same applies with music and movies.
People don't exist to serve systems, systems exist to serve people.
In an effort to get China away from Linux, they have attempted to lower prices or simply look the other way when it comes to piracy. It's a good strategy in the shortrun, but I'm not sure it will work in the long haul. What's interesting is that when dealing with China, it's more like a negotiation where here in the US, a company will try to enforce the law, even if it has to be very oppressive.
4) They are 1.2+ billion and laughing at you.
I say, fight off the chinese threat now when they're still weak
God thanks the chinese are by no means weak and they'll keep the US from taking over the world.
A little communism isn't bad when it prevents "american standards" in the world.
More importantly, think how much more expensive nike's will be without all that cheap chinese labor.. do you know what war with China would do to many of america's current businesses? There's a reason we haven't gone to war with china, and 'freedom' has nothing to do with it. -- vranash
PS2s' have been available in China for more than a year. PS2 games (english) are available for about $1 each at most computer game shops.
Getting a "Mod" chip installed for a PS2 is cheap and simple in China.
In regards to the piracy issue;
Most PC games are available (in chinese) for a lot less than half the price that you would get them in the states. Pirate versions are about 50 cents a CD.
pirated games (and other software) are widely spread here. even with punishments from fines to 5years of jail, pirates continue to support us in cheap copies. typical prices in poland:
:). dont judge people who live in much poorer parts of the world, ok? maybe at the end of century China will be richest part of the world, and we'll be pirating from them :).
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]
Oh, and 1.2+ billion doesn't matter much in the age of tactical nukes.
On the one hand, lower prices are good for the consumer. On the other hand, piracy doesn't put money in developers' pockets.
If people start to pirate YOUR software, are YOU willing to take a salary cut to compete with the pirates making money off of YOUR software?
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 listened to their accountants instead.
------ The best brain training is now totally free : )
Yeah, you cowboys of america keep threatening the world with your red, white and blue and the military chic.
I just wonder how many WTC's you have left?
Modding this down will not make the WTC unhappen.
mod parent up, somebody
Ever since growing up in the 1980s I have heard the game producers (then for the Amiga) claim that with less piracy they would sell more games and thus be able to sell them at a lower price.
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.
Pingular is a known karma whore troll
One only needs to read Sir Haxalot's (the same person, different accuont) Journal to see that what I am saying is true.
This has been seen before...and many debates already took place because of this...
...thats what has been always happening...the games that are more succefull are usually more expensive
Yes piracy lowers prices...
Simple...If there was no piracy then prices would go up since people had no chance than buying the game... thats also why console games are more expencive then pc games... the fact is, if a company can still sell well by putting prices up it will do so. But not only in pc games but also in the music industry this is the case...So much that companys are trying to spice up theyre music cd so that it becomes more attractive to buy it...
Eighter we like or not, piracy is also competition... Ilegal competition, but still competition.
Claiming that by selling more the game prices will get lower isnt the case...because if the company can sell more while maintaining the same price it will do so.
In fact
Surely the price in China and other places has just as much to do with what people can actually afford to spend? If you're making $10 a week you can't spare more than a couple of dollars a month to buy a game, whereas if you're earning $5,000 a month, $50 isn't all that much.
Sounds a lot like Sony is testing the waters in China, to see if it might be possible to make some money over there, and also because they don't want to lose mind share to Nintendo who announced they are going to sell a special GameCube in China. (Article does not state how it is special, but it's certainly harder to copy the smaller GameCube discs than the regular-sized PS2 discs.) Both companies could very easily pull out after a year if things are not profitable.
I think the bigger story is that Sony is going to try and work with Chinese software developers. Right now, you write a game in China, and you're not going to make any money. You'll probably end up in the hole and living in a cardboard box. I don't know how successful Nintendo and Sony can be, but if they can start to reverse the selfishness of Chinese people then that would be great.
One factor might be piracy. But another is that Chinese people have less money than people in more westernized countries.
There is pressure on both the supply and demand side: Supply of Chinese money is low. Demand is also low because they can get the product elsewhere for less.
It's a perfect formula for low prices.
Farmers have been selling oranges for centuries while at the same time anyone equipped with a single orange could grow their own tree.
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.
China will have a large homebrew game community? I could see this happening.
WTC happened because the anti-christian extremism was allowed (by the "tolerant" Clintonistas!) to fester in the moral fabric of our nation. We've been fighting back since 9/11 and I can guarantee you that another WTC will never happen on US soil. We stand united.
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.
45 5F E1 04 22 CA 29 C4 93 3F 95 05 2B 79 2A B2
I really wish some of you pro-piracy folks would work really hard on something that you care about for a long time and then have it stolen by thousands of people. Maybe then you'd wake up and smell what you're shoveling.
_/\ - Sturgeon's Law: 90% of everything is crud.
High prices creat piracy. It can be plotted on a cartesian coord plane. The price on the y axis, and the number of people buying on the x axis. As the price goes down, more people will be able to afford and therefore, buy stuff. This is what the idea of a sale is; you normally sell your pants at $100, if you sell them for $90 demand will increase and if it's during a busy season, you'll move more merchandise and therefore, creat a higher profit than you could before.
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.
Candy-Coated Knowledge
Your radical ideas about legal routes to egalitarianism have already occured to others.
I think that yes, in this case, the prices are lower due to piracy, but maybe not for the reason most people think. It's not "fair" competition and while perhaps Sony and Nintendo will raise prices or compensate for it in other countries, I think the actual approach is akin to dumping.
Sony and Nintendo are dumping their product, likely below cost given this is a completely new market, to gain mind share, compete against each other, and establish their supply chains and business partners in mainland China.
Once things are set up, and only if they can find enough people to purchase non-pirated software, then they will break out the economic calculators to figure out at what price point they can both continue pulling people away from stealing and maximize their profit.
[And all you idiots who are going to yell at me "copyright infringement not stealing", I use stealing in the ethical sense. Yes, sometimes I define things according to my ethics, and not the dictionary. Great how I have to put in this little disclaimer.]
-h-
Americans don't even know what piracy is when compared to china and other third world countries. Where I live you can get pirate games in DVD format for about U$3. The games come from china, imagine how cheap those games are there. An original game in here costs nearly the same as the minimum wage! It's obvious why piracy is so widespread. Companies should realise that it's better to make little money than no money at all. People wouldn't buy pirate games if the prices were lower, people do want to support game developers but at current prices it is just not an option. I, for one, have about 20 PS2 games, none original and I know I'm not the only one, in fact the only original games people have here are the ones that comes bundled with the console.
Games are priced at a level the market dictates. (i.e. as high as consumers are able and willing to pay.) Average incomes are much lower in China than the other territories. Piracy is not the influential factor here. What's better for Sony and their content providers, to make a few (hundred) thousand legitimate sales and erode the argument that piracy and imports are the only way consumers in the territory can get the games, or let the pirates have their way and make no money there at all?
As to the story's assumption that Chinese consumers will just buy pirated games for their official PS2s, well, I suppose in many cases they will, but bear in mind that the Chinese region PS2 hardware will probably have different protection mechanisms, at the very least requiring new circumvention methods to be developed. And the officially released software is actually translated into Chinese, which is an additional incentive to go legit.
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In China they have stores that sell pirated "silver" disks. Look around the web for DVD Silvers and you can see what the problem is.
In countries like the US you need to purchase a console, find someone to mod it, and then rent/borrow/download and burn copies of the games.
In China, you buy a console and have it pre-modified, or modified while you wait (you can do that in the US, but it's not nearly as common), and then you can go purchase pirated disks for $5 a disk or so.
The problem with pirating in China isn't that there are people downloading and burning games, it's that there is a whole production sector for them. Disk duplicating facilities produce the copies, they are then distributed to stores, and stores then sell them. Law enforcement does try to combat the piracy; however, it can be as bad as shutting down a store and conficating the goods, and another store will then open across town selling the same things.
So no pirated in China does not normally equal free.
The game Sony is probably releasing over there are really old games. Games where the developer has already made back their development costs and profited. Games where the publisher has already made back their marketing cost and profited. The only costs of selling these old hits will be manufacturing and distribution. All revenue greater than that cost will be pure profit because the US, Japan and Europe have already paid for all of those other 1 time costs. Because of this they can afford to drop the prices like a rock.
The GeekNights podcast is going strong. Listen!
I've for the most part given up games like you did, but now I can't just go out and pick up one of the latest games on a whim: there's no way I could run it. When you're not playing games, although your desire for better performance doesn't stop, it certainly goes in another direction -- towards dual CPUs, RAID arrays, and copious amounts of RAM.
:)
This has lead me to consider buying myself, on not much more than a whim, a console for Christmas.
We've always been told that pirate games push prices up
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.
Maw! Fire up the karma burner!
Of course, I am also way out of touch since I've not pirated any software since, maybe, Doom2. Which I've since bought. If I'm poor and fixin' for a new game I just hit happypenguin, and that tides me over for that week.
You are not the customer.
But then you have to pay for the recording costs, promotional costs, music videos, artist royalty, recording company profits etc.............
When you buy anything you're not just paying material costs, you have to pay for R&D, design etc...
You can sell goods only at so much as market is ready to pay. Who would've thought?
Game Manufacturers don't seem to be following a business model for Mass Marketing... They seem to prefer to use a model where they are priced as high as possible to maximize profit per copy rather than a model where profit comes from mass copies.
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.
Who needs WiFi when we can have Packet Over Sheep! http://datacomm.org/PoS-InternetDraft.txt
Personally, I think the single most effective "leverage" game makers have found in recent years to combat piracy is the creation of multiplayer titles that require a server-verified key in order to allow online play.
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. If it was as easy as just downloading a "warez" copy, I probably would have done so (justifying it in my mind as better than the alternative of contributing more funds to Blizzard). But alas, the "key generators" don't seem to make keys that their Battle.net server thinks are real, valid key codes. So to ensure I could play it against other people online, I had to go buy it.
That said, though, lowering game prices would certainly help improve sales and fight piracy. The people "cheap" enough to keep wasting time downloading programs they could buy for $10 or less aren't really the "target customer base" to begin with. Eventually, they'll go out and get jobs - and start realizing that "time is money". Then, they'll become customers for the reasonably priced game titles too.
I live in China. If you go to the electronics market, people practically drag you into their stores to buy DVDs and VCDs. All software you can possibly imagine, and movies usually 3 days out of the theater. Average price: USD$1 for a movie, up to $10 for a really big software set. And the chinese only sell things when they make money on them, of course. Don't give me that "communist" nonsense. Sure, the substructure of the country is commie, but at the street level and more it's free-wheeling capitalism. The reason it's so cheap is they are paying production costs ONLY, obviously. That's what pirates do. And absolutely NO-ONE in China will buy legit games if they are not only marginally more expensive than copies (like 10-15%)
Not sure where I'm going with this, but thought it might be interesting.
Might be corporate/capitalist propaganda. :.-(..
And then there's (softare) extortion, gouging and dumping.
BTW, I'm hoping for a price slash at the box office and/or a greater diversity of films from a greater diversity of actors, directors, producers (like you!), countries, etc. once film pirating gains some steam...
But then Hollywood makes me cry with those short anti-pirate pre-film tear-jerkers.
"The problem with super-heroes is that they come with super-villains."
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.
No electrons were harmed creating this post, though some may have been subjected to electrical and/or magnetic fields.
Holy shit, you just invented the demand curve! All hail!
Okay, doesn't look like this is being applied to the right entertainment market. I don't have a problem with game prices at all. There is generally a lot of creativity and work that goes into them, and the prices do fall after the item has been on the market for a while, even if it's still popular. That doesn't seem to happen with music or movies (or Microsoft software).
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.
Fred
"A fool and his freedom are soon parted"
-RMS
You'd hire your own programmers, write your own 3d engine, spend millions of dollars writing it, and release a piece of crap game which has good graphics. Look, people can license a good 3d engine, and theres many to choose from. There is no reason to write your own realtime 3d engine when theres a million companies trying to license them to you. Turbine licenses 3d engines, pay them and you can use their state of the art engine. Basically, you need the eye candy to sell the game, but the eye candy support in the API layer is shitty and nonstandard. It's tough, so you try to make tradeoffs that will let you sell well to the high end gamer market without losing too much of the casual gamer market, and deal with undiscovered hardware dependencies though patches. Eye candy alone does not sell games. Quake does not sell because of eye candy, the game looks ugly, its in a closed in area, its dark, it sells because its a shooting game that people like. Look I could find an open source 3d engine, and hire programmers to make a game out of that. I admit the engine wouldnt be as good as an expensive licensed engine but i'm proving to you there are ways to save money. If you are doing a big budget 3D game you can afford a horde of testers with a sufficiently broad variety of test hardware to detect _most_ of the major issues up front, but this requires a substantial budget. You pay one or two testers, then you offer a demo or announce on your website you are looking for beta testers and let the world test it for free. You do not have to pay alot of beta testers.
People don't exist to serve systems, systems exist to serve people.
If you don't believe that illegal copying is just like kidnaping and murder, you might prefer not to use the word ``piracy'' to describe it.
No GNU has been Hurd during the making of this comment.
Blizzard games routinely sell over 5 million copies. Blizzard routinely makes 100 million or so from just about every game they sell. This is revenue, the direct profits may be more like 30 million, but that 30 million does add up. Ask EA.
People don't exist to serve systems, systems exist to serve people.
turn down free money, but they are frequently non-linear in how they try to profit. Hence offers for "free" goods/services, etc.
Games ARE over priced for sure, because movies cost more to make than games. Music is ridiculously over priced at $20 a CD
Unlike music and games, movies have a theatrical exhibition window before they are distributed in copies to the public. Unlike CDs, which give you nearly unlimited plays, and video games, which give you nearly unlimited plays until your console breaks and has been discontinued, the $8 for The Matrix Revolutions is to see it once. Yes, some movies are distributed in copies to the public without having been theatrically exhibited, but these "direct to video" movies typically are low-budget movies which do not appeal to people who prefer to watch Shiny Things(tm).
If I were sony in this case I would probably re-work the PS 2 and use a different encryption scheme so that regular disks wouldn't work on the chinese platform to prevent outside games from being pirated in to the market, I'd of course do this not telling anyone what I had done until it was too late and set a warrenty period so short it makes the worlds smallest midget look like an f'n giant so they are locked into the platform then release games at low prices to discourage piracy, why buy somthing that might not work if for a few more dollars (say like 5 or so) you can get the real thing.
But then again, that would be an enourmous amount of work for sony to manage and unless they changed the hardware considerably them crafty chinese would break the shackles in a matter of weeks if not days after launch.
Oht well, thats my 2cents.
Seems to me Blizzards games continue to get more complicated. Go to a store and see Starcraft sell for 10 bucks. Starcraft made Blizzard a fortune, I'm talking hundreds of millions of dollars. 5 million copies of starcraft sold, and maybe a million copies of Broodwar. Warcraft 2 sold over a million copies and people purchased the addon. Diablo 2 sold millions, Warcraft 3 sold millions, and the addon sold more millions. Blizzard is spending a fortune on WOW, but all of the games before World of Warcraft did not cost alot of money to make, did not have fancy 3d graphics, and made Blizzard a fortune. The formula is simple, make good games and you'll make a fortune, make bad games and you go bankrupt. Sega spent a fortune on games like Shenmue, but guess which game made Sega the most money? Sonic Adventure! Not Shenmue!
People don't exist to serve systems, systems exist to serve people.
The model has nothing to do with it. People usually go see movies once or twice so a movie even if you see it twice makes less than a game. If you rent a movie it makes less than a game. Only rich people or hardcore fans actually buy movies. Game companies have multiple profit streams as well. Blizzard made money from battlenet, they also will make money charging $10 a month for world of warcraft, Blizzard makes money selling their engine for world of warcraft to other companies. Blizzard makes money via patents on the Diablo skill system which was used in Asheronscall and other games.
People don't exist to serve systems, systems exist to serve people.
Writing real-time 3D apps is nothing like writing other kinds of desktop software.
Then write real-time 2D apps. You can usually count on having enough OpenGL power to get a sprite display running on any Windows desktop machine in the last four years.
Give me a nice standardized console any day
OK. Here's your GameCube. (Tepples hands Fnkmaster a black GameCube console.) Figure out how to program for it. No, Nintendo won't let you have an SDK until you have made a name for yourself in the PC game market. What we need is a standardized gaming platform with an open specification.
Such a practice scheme has been around for a while in Russia. Some publishers are wise enough to sell PC games for as low as 10$ per boxed version and 5-6$ per cd only (compare to 2-3$ for a pirated cd). And the most interesting part is that people do actually buy these licensed products. I guess if Sony gets their prices right, Chinese people will buy their products.
paying software development jobs for open source projects are non-existant and its much cheaper to get free labor than to pay for software development.
Amazing how many people label one company or another as being greedy but those same people would not want their own job/company to be judged greedy since it would hurt their paycheck.
Generally I would agree with you on piracy of copies of software and media that is single-source and significantly more expensive than it should be. In a system without viable competition, piracy is a compelling form of competition as a market reality. It can be argued that it's piracy which keeps people from examining alternatives, thereby continuing the monopoly.
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
The ______ Agenda
People usually go see movies once or twice so a movie even if you see it twice makes less than a game.
Tickets for four people to see a movie cost $24. A new release game rental costs $5 for one night. Now what's overpriced?
I am in China right now working, I bought a ps2 here and have over 200 games. I bought them all in China. So for people who think the Chinese dont have ps2's are wrong, they have been here for as long as in america, just not officially launched here.
I'm saying that the existence of non-material, non-intrinsically-scarce, copyrighted works challenges the very idea of property.
Land is scarce. Real property is how governments recognize this scarcity. Likewise, artistic labor capable of producing original works is scarce. Copyright is how governments recognize this scarcity.
Will I retire or break 10K?
Japan is a member and is not supposed to sell products for different prices in different markets. I see some problems coming up for Japan.
Yes they do dub the voice acting. For example, was Metal Gear Solid (U) spoken in Japanese? No, it was dubbed into English for the North American market.
1) Routine torture of prisoners.
2) No chance of a fair trial - ever.
3) Government imposed murder of the unborn children.
4) Crackdown on Christians.
Sounds like you are describing that freedom loving Guantanamo bay not China
torture of prisoners ? check
no chance of a fair trial ever ? check
Crackdown on Christians ? s/Christian/Islam/ check
Government imposed murder of the unborn children ? check
yeah sounds like you are living in a great free country, maybe a mirror is whats needed before condemming other countries political systems
By the way, does any one know if OCR programs for Chinese characters really exist?
Google says yes.
Well here in mexico normal game development is cheap, unfortunatelly you have the quality -> education (not experience) factor: there is no game industry here and there is no educated game development personel so as a bisnessman u are obligated to get outside international talent; and that is expensive.
Reg salary for a coder in US is about 44 grand.... now pirate games here in mexico are about 10 buks a pop... the math just doesn't work; the only way we can get a game out is getting an engine and then making it work with our game in mexico; also the problem with competing with a 10 buk a pop market is that while they release and flood the markets with millions of free copies of gta or gt4 we struggle to make our game for a year and a half and w/o serious pr investment it will be forgotten way before its released.
I hope sony is not following sega's biz footsteps of loosing tons of money in an effort to theoretically control the market...
As far as an open console in concerned; that will never happen because it will destroy industry profits in the sense that now anyone can get in... the only one who would make money would be the hw vendors.
Uhh... free?
I really wish some of you pro-piracy folks would work really hard on something that you care about for a long time and then have it stolen by thousands of people.
Ask any maintainer of a high-profile Free Software package. They "work really hard on something that [they] care about for a long time and then have it stolen [sic] by thousands of people."
I can guarantee you that another WTC will never happen on US soil.
I'd feel a lot better if your guarantee were for three years, but you don't state any terms.
Asshat.
There are some major misconceptions spread on this site in the name of basic economics. Often, the arguments are a partial application of economics, creating misleading conclusions.
.. but the cost does not differ for 100,001 compared to 100,000). Marginal cost is the pure production cost, the incremental cost of pressing and retailing an additional copy of the game.
... this is the famous P=MC result.
... this is what people usually refer when they say that they need to earn a reasonable rate of return on their capital ... they need to earn enough to cover the f ixed cost and the opportunity cost associated with sinking the fixed cost in this endeavor as opposed to another.
... although it does happen to a much lesser extent in the form of generics).
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.
What "economical" (sic) theory are you citing?
It seems to me like you are flouting the most fundamental LAW in economics: the Law of Supply and Demand. Quake 3 was priced high because there was an extremely high demand for it and ID Software was, through copyright law and the fact that few other companies could produce like-quality games, able to control supply.
It seems to me like you're implying that Quake 3 should be priced lower because there is a higher demand for it. I'm sorry, but you should learn a little economics before you pawn off your babblings as economic theory.
Hey,
Sorry about the tone of my first response. Itchy trigger finger today I guess, possibly on both of us.
I think we're on the same page as far as the nature of economics, and you bring up some good points along those lines. Perhaps where we disagree is in how drastic the change is in how copyrighted works are viewed and being handled (and what that means), if China's ongoing changes are only economic growth or if some sort of fundamental change in their economy is going on as well, and what the best model for ideas / copyrighted works is.
Where I'm coming from:
I'd assert that many formal, systemic methods of modeling (how I personally see economics- sort of 'rigid', though as you say that's probably just how I've been introduced to it) lose relevence during times of fundamental, systemic change.
Where I'm coming from as far as 'copyrighted works aren't necessarilly property' is that there are many ways to view copyrighted works. One way is the approach most of the Western governments have seemingly taken, that ideas=property. I'd say that, though that's a valid approach, it may not be the best, as ideas are non-material, non-intrinsically-scarce items; in fact, they don't have much in common at all with what's conventionally deemed 'property' and perhaps the approach of, for instance, Richard Dawkins and his 'memes' might be a more meaningful, predictive, and non-oppressive way to look at ideas (I'm not pointing the 'oppression' finger at you or Economics in general, but rather at some of the economic models most Western governments have chosen to impliment).
Respectfully,
Raindance
It might look that way, that piracy creates lower prices, but that just cannot be true, long term. Piracy destroys value or, in other words, reduces the incentive to produce. I am a consumer, I want others to produce. They must be rewarded, sometimes (often?) the required reward is financial. I wish slashdotters (including CowboyNeal) did not seem to be advocating piracy. Let us rather advocate a free market. While arguing for amendment or scrapping laws such as DMCA; while arguing that eventually Mickey Mouse must become public property let us not be seen to advocate theft.
Paul Beardsell
When physical media is cheap, there's no guaranteed return on anything which can easily be transmitted via that media. This has to do with rarity value... information isn't rare unless you hold a gun to the head of everyone who might tell someone else.
People like physical media. Books, newspapers, CDs, DVDs... are all nice things to own. Most people feel they convey a status or a convenience.
Software, on the other hand, has been fighting a losing battle forever. Trying to ban other people from using even basic algorithms in their own code, on the grounds it can somehow be said to be property. Unless you're happy with a society in which people can point the aforementioned word and shout "But that's my secret magic word! He can't use it too!" the only viable model is one in which people are paid for support and maintenance of code. Because people will produce code which benefits themselves, and this effect spreads.
Ph-nglui mglw'nafh Gates M'dna wgah'nagl fhtagn.
In a world of oligopolies and monopolies, piracy acts as measure of competition, and therefore is necessary, and not as "evil" and "dangerous" as the BSA and the like wants you to think!
Of course piracy pushes the price down. I guess most corporate leaders haven't thought this through. There is always a black market, and it grows in proportion to the price of the legitimate goods. Any company raising their prices to recoup profits "lost" to the black market is insane.
Seems there are a lot of insane companies out there.
It's funny how easily we buy into their story about evil pirating driving up prices. It's _their_ job to figure out how many people will buy a product at a given price, then spend less than that on developing the product.
Cheers.
All those engineers are working for free?
OSS does not try to extract value from duplication because duplication itself has zero cost.
That fact hardly means that no one is being paid; it's simply a rational business move which accomodates reality.
In the next 20 years there will be more money in OSS than in traditional commercial software. The big players who aren't in denial are already preparing for this future.
Pretty soon, we'll see if Microsoft's treasure chest is big enough to trump inevitability...
So does slavery - it drives down the prices and increases quality of living. Speaking of which - how enormously motivated do you think programmers will work if the guy with the worst performance is shot at the end of the month?
Better living through crime... it's a dream that could come true for all of us! Yeah!
THis is just a guess, but I would think that the games that SOny is throwing over to China are titles that have already made back their overheads and turned respectable profits in the Europeon, Japanese and North American markets. Sending them to China is just bonus money. For this reason they can afford to let them go for costs very close to what the pirates are (Arrrr!) going to charge.
THis is a foot in the door tactic anyway. by establishing a legit user base, Sony probably hopes that they may in the future be able to send newer software and hardware into the open arms of consumers hungry for the latest releases.
I don't think piracy hurts as much as the RIAA, MPAA and the software moguls claim it does, but think about it for a second, If I can sell your product for material cost alone, and your company has to foot the dev costs who is going to be able to offer the better deal? Every copy I sell is a copy you won't sell. I sell enough and you can no longer recover expenses, and its chapter 11 time for you. Lower your prices all you want, but as a blood thirsty pirate I can always undercut you.
On Wall Street they say "buy low, sell high" On the pad we say, "buy high, sell high" Isn't that somehow better?
It's a cons-piracy.
In many countries, video game companies/MPAA/RIAA can get the government to arrest & prosecute companies who make illegal copies and sell them.
In China, many of the copying companies are run by high ranking government and military officials. So they won't get prosecuted. If you can't use the law, if you want to stay in that market, you have to drop your prices to compete.
Of course, you could just abandon the market. Adobe doesn't make Chinese versions of photoshop any more. It isn't worth the programmers' time - the sales will be so low due to copying.
This is nothing new: Licenced materials had been sold for very low prices in China (including Hong Kong) in order to compete with priated materials, for many years.
/competes with/ pirated music. Sure, at the end of the day it's really a sales driver for the iPod, but consider the take-rate, I say it's working pretty well.
Movies, for instance, or often released in the theater and as VCDs--on the same day--in order to combat black market VCDs taped from the theater. They are both VCDs: Both very affordable, no DRM either way, except these are high quality, and you get some nice printed materials along with it. So which one are you going to buy? Most folks I know over there don't bother with the priated stuff anymore. This is very, very effective combined with occasional raids of known pirate operations. Sure, you could do the dishonorable thing and make copies of your original VCD for your friends, but the movie houses would much prefer you rather than a movie pirarcy operation doing the work, for obvious reasons.
Now look at iTMS: Steve Job said explicitly in the keynote that iTMS
The revolution has begun.
Now, don't hold your breath waiting for cheap PS2/XBOX games any time soon in the US. There aren't really any competition against the licensed materials here.
I find this article interesting as a beginning student of economics. I've learned that cost doesn't determine price, price determines cost. Price is determined by the buyer (short of monopolies). Sony knows that they cannot charge the same prices in China that they charge in the US, Japan, or Europe so they must lower them. Piracy is credited for this policy but I suspect that low income is really the factor and was the catalyst for piracy. It is doubtful that Sony will lower prices significantly in the US. If the prices are lowered significantly, they will need to sell many more copies to cover their costs and attempt to make a profit. It is precisely because of the relatively high prices that we see astronomical development budgets for games. Since we (Japan, US, and Europe) pay the higher prices we will bear the cost of development for new games (as someone else here already suggested). The prices they set in China are enough to cover their costs of distribution and translation and turn some kind of profit.
It remains to be seen how this strategy will turn out. Will it turn very little profit and thus just encourage porting of US and Japanese games. Or will they sell enough to make an attractive profit that encourages original development?
Someone raised the issue of greed. Greed works both ways, for the buyer and seller. In general, companies try to sell as much as they can for as high a price as they can, buyers (individuals and companies) try to buy as much as they can for as low a price as they can. The reason for buyers wanting to buy at the lowest possible price is so they may buy more of the same product or more of another. Is this not greed as well?
I'll second this. When I buy a game, I don't think of it as getting a cd, jewel case, manual, etc. I think of it as getting a key for multiplayer.
The interesting thing to watch now is Valve's Steam system. I think they're trying to make an Everquest-type subscription model out of their Half-Life sequel. The next "leverage" might be real-time DRM authentication that requires an active subscription. That's something to chew on.
"God is a comedian playing to an audience too afraid to laugh." -Voltaire
That is exactly my point.
Because software companies control the supply they also control the price and they have no incentive to lower prices for a popular product. Why in the world should they do that?
I am not saying that Quake 3 should be priced lower, that is for ID Software to decide how they price their products. Hell, I even bought it when it came out, played it a lot, and felt that I got my money's worth.
I am just saying that increased sales of software won't make the prices go down. On the contrary, high sales of a game would imply to the company that the price of the product was actually right since it sold a lot. And thus, it would be an incentive to price coming products at the same level (or maybe even higher?).
You say I am babbling away but it seems to me that this is an easy way for you to not answer the important question: Will bigger sales of computer games lower prices? What do you think?
Why was this modded down (overrated)? The motherfucker should be meta modded but cannot be.
UNDER/OVER RATINGS ARE A CRIME UPON ALL HUMANIY.
There is no reason to pirate stuff. If a game is $50, well that's a lot of money to a lot of people. There is great incentive to try and find a free version. However for only a couple bucks, why bother? It's more hassle to try and get a free version than to just buy it legit, and the money doesn't matter much.
Plus most people, all things being euqal, like being legit. They'd rather be completely legal, and also get the real CD and box and such.
Now don't get me wrong, there will always be people that copy software, no matter how low the cost, but the lower the price, the more people that will buy it.
let's pretend there's no piracy whatsoever. how many games are you going to sell to a population that has a vastly lower per capita than the current markets? that combined with economy of scales, and, yes piracy. it's not a one-sided issue.
Games are a monopoly product, you price them to get the largest profit the market will let you, and differently in each market. Chinese buying power is not yet on parity with US ones (or even UK) so the prices must be lower.
Next you need to prevent grey market imports (region code etc) and then you finally have to find an excuse so that the other customers carry on buying the product and don't feel aggreived
Piracy is IMHO the excuse, nothing more, to explain to US and EU customers why they are paying vastly more for the same games. Just like Americans being ripped off with drug and school text book prices, and EU people with DVD pricing.
According to one of my Econ profs, M$ has been doing this for years- a copy of WinXP is available in China for anywhere from 24.95 to 50 bucks. That way, less people are forced to turn to piracy, and Gates turns a profit, albeit a smaller one, in Asia, where piracy is most rampant.
Gentlemen, you can't fight in here! This is the War Room!
the iQue was not a version of the Gamecube. It was a new console that played old N64 and SNES games. The flash cards was inserted directly into the controller, with no 'console', per se. Here and Here contain articles on the iQue. The controller also is remarkably reminiscent of an xbox controller. Thought someone might be interested.
The Braying and Neighing of Barnyard Animals Follows.
I thought PS2 game discs used a proprietary encoding format, making them impossible to copy on regular CD/DVD writers... am I mistaken?
"Freedom means freedom for everybody" -- Dick Cheney
What movie has ever sold 100 million tickets? Name one movie? So 100 million people go to see movies and 100 million people buy games, looks comparable on paper. Movies on the otherhand have hundres of thousands of screens to show on, and that's _before_ you take it to DVD to squeeze every last dollar out. (Not to mention off to HBO, Pay-per-view, airplanes, then the networks, then on to syndication on TBS.) Most movies will eventually break even through video, DVD sales, merchendizing and TV rights. Most games fail because once you sell it, that's it. So you have to take the $50 up front from the much smaller market. Only hardcore fans buy DVDs now. Theres a revenue stream for internet gaming and MMORPGs for games thats comparable to the HBO/PPV revenue stream of movies. Game prices have come down due to piracy of the CD format. What is your point? You havent stated anything that everyone doesnt already know.
People don't exist to serve systems, systems exist to serve people.
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. First the retailer can be completely taken out of the picture. Blizzard and other companies sell directly to customers via the net. 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. There are hundreds of millions of gamers. I'd say in the USA most people do play games. I'd also say that in the world people are starting to spend more money on games than on movies. Korea spends a fortune on games. So does Japan. The problem is not that the gaming industry is not profitable. Sega went around spending a fortune on game development and lost money, when they finally started selling their games for reasonable prices and finally decided to make sequels and reuse game engines it was too late. Dreamcast died because Sega used a flawed business model. Their model was to spend as much money to make the best game possible without even thinking about the profitability of the game. Sega would have had a successful system and would have made a fortune if every game they released were a Sonic based game or a Sega sports game. In the gaming industry innovation often hurts profitability so you want to make the same game over and over again. Warcraft 1, Warcraft 2, Diablo, Starcraft, Diablo 2, Warcraft 3, Starcraft Ghost, World of Warcraft, Starcraft 2, Diablo 3, etc. You make sequel after sequel, the first game you break even, the sequel you aim to profit.
People don't exist to serve systems, systems exist to serve people.
How could piracy make the price rise when the price is going to rise anyway? The goal of a company is to raise the price of products, the goal of the consumer is to lower the price. Piracy is our tool to fight monopolies.
People don't exist to serve systems, systems exist to serve people.
"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?"
They've pushed game prices in China down. I'm sure these global compaines are making that money up by chargingus more.
At any rate, I'm wishing the iQue was released over here as well. That, or maybe (if Hell has frozen over) Nintendo's "not a console and not a handheld" release coming up is a downloadable ROM service for GCN.
Inkjet cartridges? Hell, my in-laws just blew about two-thirds of the annual spending power of the average person in East Timor on one printer (HP 2410xi for $220), replacement cartridges (~$70 for 2 tricolor and one black + ~$30 for the photo cartridge with freebie 4"x6" photo paper) and $20 after rebate for 100 sheets of glossy Kodak photo paper (second from top grade).
/. and the figures from ET stuck in my head as my family and I enjoyed thanksgiving.
Total is $220+70+30+20+taxes = ~$360... According to the CIA world fact book ET's per capita spending power is $500.
Ok, I guess that it would make more sense to compare against PRC figures, but hey, this is
Mare privacy results in lowered pants!
Finally, an economically beneficial application of piracy as a profit-saving device. Yes!
a year or so ago (or whenever return to castle wolfenstein came out) activision had a cheap version of rtcw for sale in china. it came to ~10$ or something. anyway they gave you a disc and a number to call to register the disc and to obtain a cdkey that allows you to play online. a friend of mine who has friends over there picked up a few copies over there and send us the keys worked fine (online) for us over here in north america. as far as i know these keys are not pirated as ive never had a key conflict nor has the auth system for rtcw been cracked
It seems like most games that are released are full of bugs and don't work. They do little or no testing and let their customers do their testing.
Madden 2004 is a good example. I bought it yesterday and no matter what I do, I can't get it to work. Their webpage and documentation are worthless. Their excuse for the problem I'm having is that I don't meet the min. hardware specs.-bullcrap! I have a P4 2.6 with a 9800 pro and 768MB of RAM? How can this not meet specs?
I can't return the game because it's opened. I'll just have to wait 6 months to a year for the correct patch to come out so I can actually play the game.
Besides what has the price of games in China have to do with any of this?
" Likewise, artistic labor capable of producing original works is scarce. " Wrong. A lot of people have artistic talent, far more than the market can support. You can only afford to buy so many CDs, or watch so many movies. Its the competition between that talent and the monopoly on that talent which creates the illusion of scarce artistic labor market. This same illusion existed in the tech industry, of the scarce tech labor market and this was used to support outsourcing. Well guess what? Now we are losing our jobs because of oursourcing and companies are increasing profits. There is no shortage of artistic or technical labor, there is no shortage of music. There is enough music for each of us to listen to a new song every day for the rest of our entire lives. There is no shortage of movies, none of us have seen every single good movie. There are enough good and even great movies for us all to watch a new movie every day for the rest of our lives and be entertained. These movies may not have been made last year or even in this decade but the more movies we create the less new movies we need to create. Maybe if we made old movies free we would not need to pay millions of dollars to create new movies. In japan they do not spend millions of dollars on movies, the anime industry was created to save money while creating high quality movies. We could do that in the USA, we do not need 100 versions of the matrix, or 200 star wars clones.
People don't exist to serve systems, systems exist to serve people.
My friends and me bought a PS2 just two month ago in Shanghai. It came premodded (without saying so) at 1500,- RMB ($170, 155 EUR).
Games are widely available as pirated DVD copies, both US and japanese. A copied DVD comes at 8,- RMB ($1) and there are maybe 150 different games you can buy right in the shop on the street.
So, I am wondering what all this fuzz about "Sony introducing PS2 in China" is all about.
X-box? That's CLEARLY based on the N64 layout. Just because it has curves in certain places doesn't make it an X-box based controller.
Becuase of this, it is the citizens of the US who pay the entire cost of drug research, leading to significantly higher costs.
Wrong. The citizens of the US pay more than that (roughly double) towards the costs of the marketing to which they (and their doctors) are subjected. Interestingly enough, Canada has laws limiting this as well as the prices. The Canadian health care system would be at a greater risk if more Americans buy their drugs from Canada (less time for doctors and pharmacists to serve Canadians) than anything else.
Also, a lot of money can be saved by trying cheaper off-patent generic drugs (which can often be more effective to boot - hydrochlorothiazide is a few bucks year yet has more best evidence for preventing heart attacks and strokes than some drugs that cost dollars a day) first instead of whatever the drug-rep whore convinced their doctor to prescribe.
just because you make a game doesn't mean I'll line your pockets with gold....get over yourselves
"Water comes out of the sky for free. When it's bottled it's a $5 billion industry."
Yes, all because of perceived value. If I say, "here is a 5$ orange" you will laugh at me and walk away. However, if this is an orange you think will make it so you can eat all you want without worrying about your weight, you might think that 5$ is too low of a price.
Same thing with the water. You can get water from a tap, but it's not filtered or purified by reverse osmosis or from the Alps in France, is it? That's what you pay for -- what you value the item at.
I'm surprised more people don't understand this.
--
Internet Explorer (n): Another bug -- that is, a feature that can't be turned off -- in Windows.
The people that are paying crackheads to get sterilized are a private group....
Tim
Omnia vestra castrorum habetur nobis.
piracy comes down to simple economics: if someone can't afford something, they won't buy it. Likewise, if they can get it in another fashion for less (off the street or via download), with a similar enough product to make it worthwhile, they'll do that too.
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
~/ssh slashdot.org ssh: connect to host slashdot.org port 22: too many beers
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.
I won't argue that games are too expensive, given how things work today. But, you guessed it, I would argue that how things work today isn't at all optimal.
;+)
Here's the punch line: Too many games get made. It's that simple. Too many games get made for which publishers front the money. Because too many games get made, many (most?) of them fail in the marketplace, and the publishers are out the money on those projects. So, they have to charge enough on the other titles to make up for that.
I don't begrudge anyone the $20-$50+ USD$ I slap down for a great game. But I absolutely detest doing that for a title that sucks. The result? I won't even buy a game (unless it's off the discount rack) without having played it first. I won't touch it, it won't happen, forget it. But then, that drives up costs further though online distribution costs, advertising, etc.
So, I guess what I'm saying here is that game publishers should only produce great games, and not mere market knockoffs designed to cash in on some fad theme. I want to have enough confidence in the industry (or at least a given publisher/developer) to know that I can buy a given game sight unseen because I know it will rock my world. Period.
But now I know I'm dreaming.
Please mod this post only if you think others should/n't read this. I have enough ego^H^H^Hkarma. Thanks!
Case in point: Battlefield 1942. It was released over a year ago at $50 a copy in your typical mass retail outlet (Best Buy, CompUSA, etc.). A typical game will drop in price a couple months after release a few bucks, then again a couple months later, etc. But because it sold so damned well, Battlefield 1942 just received its first price break of about $10 at these same outlets less than a month ago, and I suspect that is more of a result of the impending release of a new Battlefield 1942 boxed set than due to any sort of nonsense regarding increased sales leading to lower prices.
The stores and perhaps EA simply realized that people were continuing to buy the game at the original price, so they didn't bother to lower it until absolutely necessary as a means of promoting new sales. It is all about taking people for as much as you can squeeze them for. While more idealistic pursuits like love and peace may take precedence at an individual level, material wealth appears to be the most important thing to humanity as a whole. You can either accept it and try to fight for a piece of the pie or you can cling to idealism and be one of the used.
Call me Mistress Cleo, but the cards say that the answer to that is, "Yes".
--- I'm going sane in a crazy world.
"Got it for a song" used to mean that the price was extremely low.
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.
IANAL, and I am regurgitating what I've read on Slashdot, but I believe copyright violations give triple damages, so even with your logic, your 20 songs may cost $60.
Compare that to the RIAA estimating that providing access to thousands of songs has a value of many millions of dollars, but the settlements are in the $2,000 to $20,000 range. Even if you posted 20 songs on your free website, the penalty should be less than $1000.
I prefer to think of any posting of songs as distributing under the radio business model. Their rate is $0.08 per play. Subsidies on recording media are supposed to make up for those who tape the songs from the radio. Sharing 1,000 songs should be worth about $80. The question is how to count one "play", since songs on the internet are available whenever someone looks for them, rather than waiting for a radio station to play it (if ever in our ClearChannel dominated world.) How long can a song be shared to count as one play? I think it should be by number of downloads rather than time-oriented. How many people hear one "play" on the radio? Estimate that, then charge $0.08 for that number of downloads. (And give up quickly when realizing the tracking system costs much more than any gains from enforcing it.)
Another question is whether a song is worth more or less because it is rare. Is the unpopular song worth more because it is harder to find? Is it worth less because few people want to hear it? In the old world, an unpopular song was difficult to find, so the price went up for those few people who wanted it after the overstock was sold at drastic discounts. Now only one person needs to keep it available for anybody to find it.
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I have written and recorded songs. I expect them to be popular, but I have not released them. When I started in the late 80s, I decided that the music industry was too controlled. Now I have difficulty believing it is possible to profit from them. That does not stop me from writing and recording, since it is something I enjoy, and something that I must do. I will probably release them on a website for free someday. If they do become popular, then I can profit from performances.
The value of music has always been low. Only by controlling the distribution channels could money be made. All the actions of the RIAA and the discussions about copyrights are the last gasps of a failing business model.
I spend my life entertaining my brain.
we need incentives for artists and others to PRODUCE. Often the best incentive is financial. I don't program, e.g., just for the love of it.
The problem is usually the reverse: how to choose from all the music being produced. Artists will keep creating because that is what they do. Much of their production will be disliked by the majority of people, but the artists still produce it because THEY like it, even if it is only the act of creation.
I write music because I like to write it. I am different from most artists because I do not need acclaim from the masses; I am happy when a friend asks me to play a song again.
- Most artists want to share their music with everybody, and want to be told their work is good. That is why they sign ridiculous contracts to get their music out. When they get screwed, their big complaint is not that they did not get the money, but that the distribution company kept the rights to the music so they cannot try to distribute it themselves.
The same principle applies to software, although it rarely counts as entertainment. I write software because I enjoy it. The entire open source community proves that people will write software because they enjoy it.
- I started programming in the 80s by writing games. I had an audience of a few hundred people who enjoyed them. I did not attempt to make any moeny from them. My compensation was the enjoyment of the experience, plus some acclaim from my audience.
- I prefer to write software that can make a difference in the world. Now I write for large corporations who benefit from my work and are willing to pay for it. Even so, they rarely pay more than a small portion of what the software is worth to them. We charged about $100K for a program that eliminated about 30 $40,000/yr jobs. The ROI for the first year was >1200%, and they have now been using it for 3 years with no additional charges.
- I program even when I don't have paying work. I may profit from these programs someday, but I do it for the enjoyable experience as much as the possible financial rewards.
Would you really stop programming just because nobody else wanted your work?
I spend my life entertaining my brain.
Getting rid of piracy by eliminating the main reason for piracy? Why, thats just crazy enough to work!
I think you have these backwards. Microsoft has slipped release dates at least as often as any open source project. And if you think there's no deadline in open source, just try to add a feature for the 2.6 kernel now.
"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)"
Most employees can leave most companies with a 2-week notice. What are you talking about?
Look at all the morons who flunked economics!
Did it occoure to anyone qouting economics that if the price is too low most compaies will not produce those goods and services? And those that do will be very low quality (i.e. those budget games that cost $10.00 and usually have review with scores less then 10%).
Sure you could save some cash, but the trade off might not be worth it. Just how well would you like doom 3 if they just skip stuff in order to produce it at a very low price? Would you complain about all the bugs and glitchs they missed due to not doing extensive play testing in order to keep the cost down?
Then again, can't say I am surprised, this fits in with the "They are t3h evil corperations, and thus their stuff should be free!" attitude here one slashdot.