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Study Claims Point-of-Sale Activation Could Generate Billions In Revenue
Late last year we discussed news that the Entertainment Merchants Association was pondering a plan to develop technology that requires games and movies to be "activated" when they are sold at retail outlets, primarily to reduce theft and piracy. Now, the EMA claims a study they commissioned has indicated that employing such a system for video games, DVDs, and Blu-ray products would generate an additional $6 billion in revenues each year. Critics of the idea are skeptical about the numbers, pointing out that the majority of game piracy comes from downloading PC games, which this plan won't even affect. There are other problems as well: "In order for benefit denial to work, the EMA would presumably require the three major consoles to have some sort of activation verification function to ensure that games were legally purchased. It will be interesting to see if Nintendo, Sony, and Microsoft agree to that. There is also a lucrative market for used video games to consider. After some gamers complete a title, they sell it back to the retailer. How will benefit denial handle that situation?"
This is about stopping used games sales, nothing more, nothing less
You know, they could make an additional six billion by creating games people actually want to play in the first place.
And what about the sales lost because of annoying the *customer*? Greedy idiots.
There is also a lucrative market for used video games to consider. After some gamers complete a title, they sell it back to the retailer. How will benefit denial handle that situation?"
It won't handle that situation, because it's exactly the one they're really trying to stop. Illicit copying on consoles is a lot more difficult than PCs; it's always possible, but you're cutting out a big chunk of the potential copying going on if it requires a soldering iron to get it done. Publishers can afford to completely ignore illicit copying on consoles.
However, they can use "piracy" as a rallying cry to put in measures to kill the used game market.
Not a typewriter
How can you ever know how many pirates would ever purchase your product? I do think that piracy is hurting these companies, but they can't keep making the assumption that there's a goldmine of potential customers out there if only they figure out a way to make acquiring their products even more difficult. I'm pissed off enough with the way my HDMI connections constantly flake out or introduce annoying delays into my home theater setup. Now, how are people like my Luddite parents going to react to yet another hurdle? Content providers need to do some serious soul searching to see how many people they're deterring as opposed to the numbers they think they'll draw in from the shadows.
I swear to God...I swear to God! That is NOT how you treat your human!
... they figure out a way around the "I won't buy it" problem. The sales lost to "I won't buy it" and "I don't know you exist" and "I'm not really interested in your game" and "How much? You have got to be kidding" and "No, I won't buy you that game - you just had your birthday and Christmas is 5 months away" and "I really need to pay the rent - I can't buy that game right now" and "I'll just take a walk instead" and "Wow - that sounds like a great book - I'll buy that instead of that game" vastly outnumber the number of sales lost to piracy. Give people a reason to buy the game, and they will do so, should they be so inclined. Give people more reasons not to buy the game and they will gladly comply as well.
The big retailers won't stand for the slowdown at checkout this would cause. Various schemes like this have been proposed before, and Wal-Mart isn't interested.
If everybody who wants activation at checkout, from cell phones to gift cards to videos, gets together and standardizes on a system, maybe.
This is just another example how big media is trying to circumvent the right of first sale. They would prefer that you aren't purchasing the product, but rather a non-transferable license to use the product. This effort must be thwarted at all costs, or pretty soon we won't be able to "own" anything...
Sometimes, real fast is almost as good as real-time.
I realize my perspective on what the value of something is might be a little strange, but I hold that it is quite logical.
I don't buy diamonds primarily because of the blood and scandal associated with them, but also because of the resale value problem. "Used diamonds" sell for SIGNIFICANTLY less than "New diamonds." Why is that? The real and true value of diamonds must be closer to that of used diamonds than that of new. I also don't buy "new cars" for the same reason. There is a huge loss in price between the two states of new and used and it's not equal to or less than the value of the use I get from it in my opinion. Therefore new cars represent a big waste of money and is a bad investment... same as diamonds.
How does this reflect on the topic? Simple. This "activated at POS" notion serves only to limit or kill the resale potential for a single title. They seek to control not only the copyright, but also the access to the media. And without the possibility of being able to resell the games or music or movies one has purchased, you are looking at an even greater disparity between the first sale price and the resale value. When they decide a title is no longer available or eligible for activation, the owner's purchase becomes completely worthless. (And let's say a game activation was tied to an XBOX Live or similar account system and for whatever reason, the XBOX Live account is no longer available and the same person needs to create another account... will he be able to take his game activations over to the new account? I DOUBT IT. This could mean the loss of several hundred or possibly more than thousands of dollars of first owner cost at the discretion of the policy of the hosts of the accounts used to manage activations.) This is a step worse than the "DRM nightmares" that people have encountered when DRM content providers shut down servers or their servers fail or their data is somehow lost or corrupted resulting in the loss of access to content that the user legally paid for.
This is yet another way in which the public domain becomes a casualty of the greed of copyrighted content owners. We seriously need to crank up the volume when it comes to expressing the loss of the public domain to legislators. Large parts of our history and culture have been lost forever already due to the way copyright is abusing the public's good faith. (Yes, I said good faith because MOST consumers don't infringe on copyrights... MOST don't have a clue as to how they can even do it.)
It's about stopping the pirates from getting the game much earlier than it's retail release date. Some studies have indicated that there is a good 10% extra to be had if you manage to have your 1st 3 days of release without a pirate version available. People who might have bought, but went for a pirate copy instead because they couldn't be bothered to drive into town for example. Most of the pre-release pirate games come from retail, where games may have been shipped to store anything up to 2 weeks before the street date. Employee's of games stores who have ties to scene release groups will purchase or borrow a pre-release game, upload it to the group who will crack it if necessary and then upload it to a private FTP where they hope to win points for being the 1st group to release. From there the game will be disseminated via the usual channels like torrents, usenet, rapidshare (aparently much to the disaproval of The Scene, who just do this to see who can get there 1st). Basicly for years the carefully craftd release scheduals and marketing plans of huge media companies have been screwed up by a bunch of teenagers having an e-penis waving contest. It's nothing new though, it's been happening for 20+ years and has it's roots in dial-up BBS'. There's a scene for virtually everything, not just games. Albums, singles, vinyl DJ promo's, DVD, Blu-ray, PC Apps, Mac apps, Music Production sample packs, they all have their own scene and their own set of groups that are fighting to be the 1st to get a pirate copy on the internet. This is where piracy comes from, not terrorism, not organised crime, just a bunch of teens playing a game against each other.
On the subject of the used market, publishers will be shooting themselves in the feet if they want to go ahead with killing the used market. It's estimated that a substantial number of new game buyers partially fund their games buying through trading in their old titles. So the loss of the used market will more than likely have a negative effect on new sales close to the value of
I think that peple need to realize that there is simply not an infinite amount of money in the ecconomy and that somwhere you reach a point where no more sales can be made until more cash flows back to the pockets of your customers. However, if you keep the money moving around fast enough, it can seem like there's an infinite amount of it.
I only buy pepper spray that's been tested on anti-vivisectionists.