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The Downsides to Digital Distribution
The gaming industry's ongoing shift from physical media to direct downloads has made buying new titles much more convenient, and in some cases cheaper. However, as this article in The Escapist notes, there are downsides as well, such as an increased dependence on console makers and the inability to sell your used games. Quoting:
"Microsoft and Sony might end up charging publishers an arm and a leg to enable game downloads, especially as they gain more and more control over distribution. Think about it: What if, 10 years from now, 50 percent of software sales for Microsoft's latest console come through Xbox Live? Or, in an even scarier scenario for consumers, what if there is no physical media drive at all, and everything goes through Xbox Live? Sony's marriage to the Blu-ray format ensures its continued support of game discs, but Microsoft has no such restrictions. They could cut console production costs and take control over the entire supply chain in one fell swoop. There would be zero room for publishers to negotiate anything in such a de facto monopoly. The perfect comparison is Wal-Mart. As the world's largest retailer, Wal-Mart is able to demand pretty much whatever it wants of suppliers because it grants access to such large numbers of consumers."
and simultaneously abandon all customers without high speed internet access. For the sake of a DVD/Bluray drive? It's not going to happen.
Or, in an even scarier scenario for consumers, what if there is no physical media drive at all, and everything goes through Xbox Live? Sony's marriage to the Blu-ray format ensures its continued support of game discs, but Microsoft has no such restrictions.
That "something" being the handheld market. Sony is going to do pretty much exactly as this describes with the PSP (despite their "marriage" to UMD), so there's no need to make hypothetical arguments; we can simply see what happens there in a few years.
microsoft and sony decide what games already are allowed to be produced. they can't charge too much because if they don't have enough good games, then no one will want the console.
I declare: 2015 will be the year of the Linux video game console!
With games like networked FreeCiv, custom content versions based on the open source Quake II engine, and Snake who needs the evil, proprietary XBox Live?
On the other hand... for anybody who didn't realize that Microsoft *invested* $4-8 Billion on the original Xbox to claim the $40-80 Billion "home entertainment market" in the future... shame on you.
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If they had an actual monopoly, do you think the prices would still be low?
Umm... no, it's not. Because of Walmart's bizarre moralizing policies, many creative endeavors end up being curtailed and censored to see the shelves at Walmart. I mean, they censor all the music in their stores! And they don't even always warn you that the album has bleeps! Meanwhile, 10 feet away you can buy the unrated version of Natural Born Killers. I don't get it...
To the haters: You can't win. If you mod me down, I shall become more powerful than you could possibly imagine
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As someone who bought two copies of Portal (one standalone, then as part of the Orange Box) and got pissed at the Steam for not letting me give one of the copies away, I sympathize with this. I've already decided that I won't buy stuff on Steam any more unless (like for Portal 2 and HL Episode 3) there's no other source.
They're already at the mercy of the holder of the key for signing games. Unless they want their release restricted to homebrew / modchipped consoles, there would be no difference.
but as a consumer Wal Mart's monopoly is a good thing for me.
Wal-Mart's monopoly is a good thing if you are only interested in cheap imported garbage that breaks down within a year. If you are interested in something better then you'll have to go elsewhere. Hopefully the "elsewhere" didn't close it's doors trying to compete with your friendly slave-labor (from the factory in China to the poor bastard here at home making min wage with no health benefits) depot.....
I want peace on earth and goodwill toward man.
We are the United States Government! We don't do that sort of thing.
With Wal Mart prices are LOWER. Maybe not for companies, but as a consumer Wal Mart's monopoly is a good thing for me.
That is a dangerously short-sighted view. Wal-Mart under charges, creating a false, diminished sense of monetary value of products. Consequently, either the product quality suffers, or the conditions under which the product is manufactured suffer (e.g., factory farms, slave labor).
Help fight poverty: Punch a poor person.
Don't game companies still need approval from Microsoft to distribute games in physical media? If so, how would moving to a downloads change that? You still need the same approval you did before.
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Of course people can say Marxist theory is insane, but the predominant economic theory is that everything is fine, markets correct themselves and all of that nonsense. So what is really more off-the-wall, the Marxists or the Panglossian head-in-the-sand economists of today who say everything is fine? This is from someone who has seen the US economy stagnating since 2000 (other than some slight growth in the mid-decade with the real estate bubble, which is currently popping).
x box live already charges outrageous amounts for games that came out 10+ years ago.
Some might claim that Disney charges outrageous amounts for films that came out 70 years ago. What makes you think the prices for rereleases on Xbox Live Marketplace and Wii Shop Channel are outrageous?
Consequently, both the product quality suffers and the conditions under which the product is manufactured suffer (e.g., factory farms, slave labor).
Fixed that for you :)
Fixed that for you :)
When life gives you crap, Make Crapade.
Sluggy Freelance.
Microsoft commandeer a market, forcing developers to use their proprietary tools and to cater only to their platform?
Yeah, like that will ever happen...
Funny may not give karma, but +5 Informative never made anyone snort coffee out their nose.
Probably - they've figured out that underpricing everyone out of the market will keep them unfathomably rich. If they raised them that would open the door to a new competitor rising up and spoiling the currently perfect scenario.
It's like in those old sword fighting movies when the hero is disarmed and the villain just for shits and giggles tosses him back a sword - and he inevitably regrets it. Wal-mart isn't stupid enough to keep tossing competitors back a sword by lowering their prices. They've found something that works and seem to be sticking with it.
"People who think they know everything are very annoying to those of us who do."-Mark Twain
STFU.
Fixed that for you :)
Fixed that for you :)
Fixed that for you :)
Capitalism has a tendency towards monopoly. This was pointed out by Marx in the 19th century, and expanded upon by Lenin
Ah, pointed out by leading thinkers who advocated & implemented the government having a monopoly over EVERYTHING.
Power tends to acquire more power. Better capitalistic power which tends to self-limit by still leaving people choices*, than governmental power which tends to literally kill the competition.
(* - You don't HAVE to buy at Wal-Mart. You CAN get internet access from other sources. You DON'T have to buy health insurance. Etc. ...vs., say, being heavily fined if you _don't_ participate in ObamaCare, or jailed if you try to start a First Class mail service.)
Can we get a "-1 Wrong" moderation option?
Personally, I'm fine with digital download replacing media. It is better for the environment and more efficient. I would expect the system to (a) let me sell my key to another person, and (b) let me re-download the data if I need to.
(a) will never happen. With any of the console manufacturers, unless Gamestop decides to make a console, then maybe. (b) might if you're lucky, but think how many hours you will waste re-downloading games when your Xbox720 inevitably breaks.
Another thing that digital downloads will put a stop to is: taking a game over to a friend's house to play. Sure, you could give him your Xbox Live login (or PSN) but that's linked to your credit card. How much do you trust your friend? Also, you'd have to coordinate with your friend the day before, or wait hours for the game to download to his console. And that's if he has enough room on his hard drive. And let's not forget the move towards metered broadband...your friend might not be so keen to download your game if it costs him money.
I wouldn't touch an all-digital distribution system. Convenience is one thing, but there are just too many aspects of console gaming that we take for granted that would disappear. It's bad for consumers.
(-1, Raw and Uncut is the only way to read)
If the claims in the article are anywhere close to reality, then I wonder why they didn't consider the effect on the actual development of games.
Think about companies like EA who rush timelines and overwork their employees already! Now all of a sudden they're presented with a situation where the digital media can be altered at any point by patches and upgrades, and they aren't limited to a "gold" copy of the game. Now, granted, many current games with CD's release patches to improve the flaws in the game, but imagine when all of a sudden greedy companies are given a license to release unfinished games? I could see a world where no one purchases new games for several months, just because it was released unpatched.
You can preach to me forever about how morally wrong it is to shop at walmart, but fact of the matter is, I can fill up a shopping cart for HALF at Walmart compared to any other grocery store. With trips going twice, even three times a month for a family, I am avoiding spending up to $600 a month just by shopping there. I'm sorry, but $600 a month is more value to me (and just about everyone else) than feeling good that I didn't indirectly support some sweat shop.
"When life gives you lemons, don't make lemonade. Make life take the lemons back!" -- Cave Johnson
Digital distribution is fine, as long as these guarantees are in place:
1) I can transfer my rights to the game to some 3rd party (ie, selling it on the 'used game market')
2) I can play the game without it needing to 'phone home' (so I can play it offline, and I can play it even if the activation servers go away).
3) I can play my game on any other device (eg, my wii breaks down and I buy a new one-- i should be able to play all my purchased games on the new one).
4) If the next generation console is backwards-compatible, I can transfer all my old games onto it and play them there (again, hopefully this would work even if the old activation servers no longer exist).
wrap it all up in drm if you want, but it needs to walk and talk like physical media, including all the freedoms (rights) i have now with my physical media.
Capitalism has a tendency towards monopoly. This was pointed out by Marx in the 19th century, and expanded upon by Lenin 95 years ago [marxists.org]. T
I have a broader theory than that. Things tend towards shit over time. The longer the period of time, the greater the likelihood all will be shit. Finally that shit hits the fan, people get mad enough to do something about it, and they put together something that isn't shit; it might even be quite good. But then they relax and time goes on and things start going to shit again.
Capitalism sucks. Marx and his buddies saw that, tried to come up with a better idea. It turned to shit. Capitalism has had a few reversals thanks to the threat of socialism/communism but now that the threat has gone away, things are sliding to shit again.
Microsoft products suck. But some hippies and computer scientists tried coming up with a better idea and Microsoft said "Oh, shit." So they were able to actually reverse the shittification process of the 9x series and came up with Win2k. Brilliant. But then the slide towards shit resumed. Some people liked XP, some people hated it, but everyone hated Vista. W7, a reversal or a further slide down the shit chute? Only time will tell.
So, to somehow get back on topic. Company makes a game machine. It's great. Company gets greedier and graspy and ends up alienating customers, turning to shit. Eventually people won't want to use their shitty products anymore and they go away. Atari exists only as a brand name used by another company. Sega is a shadow of its former self. Nintendo remains but people argue as to whether they've declined or are stronger than ever. Certainly they don't dominate the market as they did in the NES/SNES era. Sony came onto the scene out of nowhere with the PSX, reigned supreme with the PS2, and became an also-ran with the PS3.
It's hard to say what the future will hold but I do think the console makers are lusting after digital distro. The only question is whether the market would bite. I thought Circuit City's Div-X would have been more popular than it was and was pleased when it failed. Will customers make the right choice here?
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Sell the spice to CHOAM
This Mahdi took Shaddam's Throne
The visibility of their product is what sells it, not just the cheaper price point than Sony's offering or their "household name" factor.
To most people, "Microsoft" is what you call Word/Outlook/Excel. "My Microsoft is broken," they'll tell you, then go off to drink a coffee with a name more complicated than "Word."
If Microsoft wishes to retain credibility as a console manufacturer, they either need to do some colossally big marketing of the idea of independence from physical media or they run the risk of falling behind on game sales - the bread and butter of the console gaming market.
Plus, come Christmas time, what is Grandma Mildred going to buy for the kids? A plastic card that they can use via the XBox's digital distribution system tied to mom and dad's credit card which the children or the parents would have to redeem for the nebulous concept of "Points" that the children can then decide how to distribute between the various XBLA offerings? Hell no, she's going to buy them "Wii Carnival Games" or some random racing or sports game for the PS3.
This is not to say that it's impossible to escape from the concept of retail software, only that they need to come up with an effective marketing tool to get people to start thinking of gaming as something that happens on the Internet, not in the home on the box plugged into the TV.
The land shall stone them with the bread of his son.
I've never been impressed with the concept of selling used games. I respect and think that that the right to do so is important, but given how incredibly crappy the return on one's investment is I've never even considered selling a game. Today's used video games are yesterday's baseball cards. I remember the exact same predatory purchasing behavior going on at my local mall in the 1980s. If it could happen without tarnishing our right to resell a game, I'd be more than happy to see this 'business' model fall apart.
Due to the above, I think people shouldn't focus so much on the used game sales and instead consider the net benefit that *might* be had if the physical distribution model went away altogether. First off, no more disc-based DRM schemes. Secondly, buying direct has the *possibility* of driving down prices. Obviously, if Sony, MS, et al decided en masse to keep game prices high they could do so, but they would at least have more flexibility by not being beholden to the retailers. If there's one lesson to be learned from the last several hundred years of product distribution, it's that there's always a better deal to be had by skipping the middleman.
If the publishers did decide to engage in price-fixing, there is a strong argument that could be brought against such behavior. Let's say that a game today sells for $50. Now, tomorrow the physical distribution model evaporates, we're all buying direct, and the publishers refuse to take advantage of the opportunity to undercut one another to gain a competitive advantage. This is obviously not free-market behavior, and the only question that would need to be asked is, "How can you claim to sell something for the same price as you did yesterday, when the distributor and retailer markup is gone?"
The answer to that question, of course, would depend on how strong the gaming publisher lobby is...
Considering that Christmas was a subversion of a pagan holiday, you really don't have much room to complain.
My sig can beat up your sig.
Wal-mart isn't stupid enough to keep tossing competitors back a sword by lowering their prices. They've found something that works and seem to be sticking with it.
Didn't you mean raising?
This comment is worded exactly as intended. Any application of lame "Fixed that for you" jokes will be "dealt with".
Irony bleeds.
That's not how monopolies work. If Wal-Mart had an *actual* monopoly, they *could* raise their prices because no one else would be there to undercut them.
In your analogy, it would be like the villain throwing a dead hero back his sword.
However, while Wal-Mart isn't a monopoly per se, it does have some monopolistic attributes which, while probably not illegal, are at least a bit concerning from the consumer's point of view. Wal-Mart is sufficiently large to make demands of suppliers, such as the movies and CDs are (or at least, were, I haven't looked into it recently) edited from their original versions and were no labeled as such. If you're opposed to RFID (personally, I'm not terribly concerned by them, but some are), Wal-Mart is instrumental in getting them into products. Similar happened with the bar code. Wal-Mart demanded all products have a bar code, and thus they became standard everywhere.
Finally, they bully their suppliers to such an extent that they often have to provide products at a price lower than they can afford or not be carried at all. While this generally means lower prices for the consumer, it forces manufacturers to cut costs and cut corners, often by lowering the quality of their products and shipping jobs overseas (e.g., to China). To me, this is the worst thing Wal-Mart does, and is the most invisible. We get products cheaper today by sending our jobs overseas, which sends wealth from the US to China, not to bolster the US economy, but to bolster Wal-Mart's profits. I'm not against profits at all, but there comes a point where someone's right to seek profit causes too much damage to the rest of us to be allowed.
You should consider "Wal-Mart is able to demand pretty much whatever it wants of suppliers" a little more. Wal-Mart demands what IT wants of suppliers, not what the consumer may need or want.
Specifically, Wal-Mart writes the specs on items, such as computers, lawnmowers, etc, that they want to buy. Often times, the specs are lower quality than the supplier might wish to offer. Briggs & Stratton suffers from this. Briggs builds some very high quality engines, but Wal-Mart doesn't want to pay for that quality. Wal-Mart wants an engine that can be reasonably expected to last one season, under moderate use. And, that is exactly what Wal-Mart gets. Wal-Mart puts a price tag on these lawn mowers, allowing you to compare them to lawn mowers that APPEAR to be similar, and allowing you to believe that you are getting the same product at 1/2 or 2/3 of the price.
It just ain't so.
If you want a good quality lawnmower that is going to last as many as 5 years, with a minimum of maintenance, you will purchase your mower from a reputable lawn care equipment dealer. Yes, it will likely have a Briggs engine that looks almost like the one Wal-Mart offers - but if you strip it down, you WILL find differences. A lot of differences.
Ditto with computers, and any other high dollar items.
"Windows is like the faint smell of piss in a subway: it's there, and there's nothing you can do about it." - Charlie Br
By the time it gets here, it is unloaded, sorted, placed into a pick-to-light lane (PTL), blah blah blah (see here.) All to the tune of 0.22 USD per pair of shorts or 7.04 USD per box.
It is shipped out, taken to a Wal-Mart DSDC (which is also the name of their software for handling this, fun!), sent to a Wal-Mart via whatever method, and then some lacky getting paid around 9.00 USD an hour places it on a rack for your greasy hands to purchase.
Wal-Mart sells the standard sizes at 10.00 USD last I checked and plus-sizes at 12.00 USD. That would equal 320.00 USD per box for regular size and 384.00 USD per plus-size. Adding what I can see, 8.20 USD has been spent to get it out the door to Wal-Mart. That leave them 311.80 USD for regular sizes and 375.80 for plus-sizes to spend to get it to their store.
I do not know how much is spent getting through the Wal-Mart Network of warehouses, but I doubt that it is over 100.00 USD. I am sure you can see how much is left in profit.
But that is neither here nor there.
either the product quality suffers
Oh please, that is a wonderfully large understatement! I do remember a day where thirty-six cuts were released by the vendor QC department because Wal-Mart demanded that the products be at their stores, now. However, if someone notices that the product is faulty then Wal-Mart blames the vendor because they told them to "get the product in the store, now" not "send us crappy clothes outside of spec."
It is a fun game that Wal-Mart plays with their vendors. At any rate the vendor went bankrupt, the 3PL dropped the account, and I went on to find a better job.
No one said that anything had to be fair, might as well be professionally unfair while you are at it.
Yes, many manufacturers fall into this trap. Walmart demands a particular price point for "Brandname A Model X". The company that makes that product can't make a profit on "Brandname A Model X' at that price point, so, in order to get it into Walmart, they create a version of Model X that is not up to the normal quality standard of Model X that they sell only to Walmart. The consumer has heard good things about Model X. They see it at Walmart for significantly less than anywhere else, so they buy it there. The Model X they bought wears out/fails sooner then they think it should. This consumer decides that Brandname A is overrated and won't buy it ever again.
I worked for a company that made the correct decision when put into that situation. The company I worked for (let's call it A & Sons) was a small local manufacturer of a food product in high regional demand. A large regional distributor to restaurants asked A & Sons to sell them the equivalent of their then total production at a 15% discount over what they then sold it for. A & Sons was in a position to ramp up their production to meet this additional demand. But when they ran the numbers, they realized that they could not meet the proposed price point without reducing the quality of their ingredients. They told the distributor that they could provide that quantity for slight discount over the price they normally charged but not 15%.
The distributor went with one of their competitors. A & Sons is still going strong, the competitor is out of business.
The truth is that all men having power ought to be mistrusted. James Madison
One thing that I really dislike about capitalism is the concept of the race to the bottom. I don't blame the system; I blame the consumers. If you always focus on the cheapest price, you get what the airlines are delivering to us now. Less leg room, poorer service, hidden fees - which is essentially the race to the bottom. If it were not for government oversight (something not typically found in pure capitalism) - we would likely be seeing more planes dropping from the skies - as maintenance is a huge cost to the airlines.
I work with top PC OEMs in product design and market competition scenarios. It is exceptionally frustrating to see how entities like Best Buy make up for the gap in PC sales profits. For the most part, Best Buy (I am picking on them, but they are not the only ones) will sell computers at cost, or sometimes below cost. They order machines which hit a price point (say $499 USD), with a decent processor, but crap parts and low RAM amounts. Because of the volume, there is a lot of competition for an OEM to meet the price point and move machines. Often, they themselves do this at cost, and bridge the gap with 'bundled software' - or trial crapware.
So here is the rub - the OEM is counting on the trial software for profits, and they may make $1 for every app they preinstall, and an additional $5 if the user activates (or purchases) the software. Best Buy, on the other hand, intentionally sold a machine with less RAM than it should have. The machine, therefore, runs slow with the crapware and the lack of memory. Time for an upgrade! Sell the user a couple of sticks of overpriced memory, and charge them $99 for a tech to install the memory (5 minute job) and uninstall the trial software (5 min job, as this can be scripted). That $99 + aftermarket memory is a great place for Best Buy to make their profits on the PC sale - that, and extended warranties and huge markup on cables/printer cartridges. However, part of this process is to remove the software that the OEM is counting on to make their gap.
Again, this isn't the fault of capitalism; but having consumers fixate on the price creates these situations. From my perspective, capitalism is where all parties have created win-win situations; where the buyer pays a fair price for the goods provided by the seller. As soon as the buyer fixates only on the price (such as the situation Walmart creates), then we lose the win-win deal, and likely end up with compromises that negatively impact the buyer long run.
I work for Walmart and am treated far better than the mom and pop shops I worked prior. No family run stores where inbred family members call the shots and change store policy to suit them. How many mom and pop stores pay their employees profit sharing and match stock purchases at 15%? There have been many associates that I have worked with, who left the store complaining about Walmart this or that, only to reapply wanting to come back. It is not a perfect company, no company is. All companies do what they can legally to minimize costs and increase revenue. They all do. Walmart is better at it. Criminalize efficiency! Don't like Walmart, that is fine! It is your choice! Shop where you like. Just don't tell me and others where to shop. Don't blow smoke about things you know nothing about.
Have you comparison shopped lately? I buy from Wal-Mart less and less because I've noticed something lately: they're not so cheap anymore on a lot of stuff. Shop around. You may be surprised what you find.
Many 'monopolistic attributes' die. Wal-Mart demanded music companies stop selling to iTunes, and they were ignored. Wal-Mart fills their store with cheap junk, so people switch to Target. Wal-Mart demands lower prices and the cheaper products end up with higher return rates and product failures, which also lead to increased legal and insurance costs.
Many manufacturers choose not to sell their products through Wal-mart while many others have their own oligopolies that Wal-Mart has to contend with, such as car batteries and name-brand pharmaceuticals.
The shipping of jobs to China is not a Wal-Mart issue nor even a China issue, it is a U.S. immigration policy and labor policy issue. For over a century the U.S. was the destination for opportunity and freedom from oppression. Immigrants would come here to seek better lives for themselves or for their children. They would come here with no skills, empty stomachs, and a strong desire to make the world a better place for themselves and others. They would work terrible hours for terrible wages in poor conditions. They saved every penny they made and lived in poverty so they could afford to send their children to good schools and better colleges. On the backs of their eager labor, entrepreneurs would make millions, employ thousands, and establish and expand schools, churches, and other not-for-profit organizations. The Smithsonian, Harvard, Stanford, Carnegie-Mellon, Howard Hughes Medical Institution are just a few of the largest and most prestigious, with countless small and mid-size organizations created by them that make daily differences in people's lives.
But today only 10,000 people who are do not have direct relatives are allowed to entry into the U.S. Even if you have a direct relative, it is still not an easy or fast process to gain citizenship. Wage laws make hiring people a significant risk with large tax liabilities and insurance payments attached to hiring. Minimum wages make it impossible to hire unskilled labor and maintain a profit. These policies mean that we are not going to make very many things that people want to purchase.
Wal-Mart cannot be held to blame for this policy for many reasons, not the least of which is that they are doing what every company in every industry in the U.S. is doing. Go to just about any non-Wal-Mart store, online and offline, and you'll find many of the products are made in China. Design a product and figure out how much it is going to cost and how many you have to sell to make a profit, and you'll quickly decide that the U.S. is not a smart choice for your manufacturing needs.
To get an even better feel, take a look at how many products are made in the U.S. China is the nation that we have the largest trade-deficit with, but it is not the only one. In fact, there are no countries with which we have a notable trade surplus. If special tariffs were created just for Chinese imports, companies would quickly move to Taiwan, Thailand, Singapore, India, South Korea, Eastern Europe, etc.
However, believe it or not, nobody enjoys doing business with China. If fact, everyone hates it. There is an 8-11 hour time difference. Simple questions take a day to get a response to. When there are warranty issues, it's hard to deal with when the supplier is in another country. The payment terms are awful, long lead times make forecasting a constant nightmare, and high minimum order quantities give headaches and nightmares to executives everywhere.
This problem is not about preference, it is about market forces. Wealth is leaving this nation at an astonishing rate and we are only doing things to increase that rate.
I once took an excursion to Reddit, and later HN. Unlimited up/down voting sucks when dealing with a hive-mind.
>>>And until then- you suffer from the effects of the current monopolist.
Riiiiight because there are no other places for us to shop then Walmart (cough - Target, Kmart, Meiers, Sears, Boscovs, ...). Pu-leeze if you're going to make an argument, don't make it so easy to refute. There is simply no justification for having government (a far, far worse evil than walmart) to interfere and try to break-up the company.
You need to watch this Penn & Teller video (yes all 25 minutes):
http://www.youtube.com/watch?v=1ZfoNZd_HEk
Walmart Hatred is Bullshit
"I disapprove of what you say, but I will defend to the death your right to say it." - historian Evelyn Beatrice Hall