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Digital Distribution Numbers Speak To Health of PC Game Industry
An anonymous reader writes with this quote from PC Authority:
"Over the years many voices have declared PC gaming dead. We have seen developers abandon the platform for consoles, citing piracy as the cause. Game stores have slowly relegated PC games from prime shelf position to one tucked away in the back corner — even Microsoft dumped AAA PC game developers from the company. It seems, though, that the demise of the PC as a games platform has been exaggerated, because until very recently sales data ignored digital distribution, with the latest data released by US company NPD revealing that 48% of PC unit sales in the US in 2009 were digital. That translates to 21.3 million games downloaded in the US. Interestingly, although 48% of games were sold online, it only worked out as 36% of the revenue. This highlights the fact that it isn't just convenience that has PC gamers shopping online; it is also that games are generally cheaper than in stores."
The demise of the PC has been called for for at least 20 years now. I remember similar headlines in the early nineties, claiming that home computer gaming industry would be beaten to pulp by japanese consoles like the Sega Genesis or the Super Famicom, mainly because it would be impossible to pirate a cartridge.
Nowadays, we have a massive user base connected to a cheap digital distribution network, the Internet, with no vendor lock on. You need the right technology and strong commitment to take advantage of such a powerful platform: that's what Valve did with Steam and, seven years later, it's still a great success.
Hack your mind out of its sandbox.
Borderlands:
Amazon.com from a shifty third-party seller - $28 ( before shipping )
Steam - $30
Onlive, which charges you $5 per month AND eats your games when you quit, $40, if I recall correctly.
Mind=Blown
Until it is DRMed by a Steam-like system, the owner vanishes and your game is gone. Granted, some boxed games these days have bad DRM (EA), but the old-school copy protection is as good as not existing. I've got 15 year old games I can still play. I doubt the same would be true of most modern digital downloads in 15 years.
That said, there are some sensible digital download sites (gog.com and, from the sounds of it, gamersgate.com) that do give you the discount and the freedom/fair use.
Who'da thunked it - if people can get a game cheaper and quicker without leaving their house then they will! Next thing you know they'll be telling us that people go shopping in sales...
World of Warcraft > all console games combined.
For in politics, as in religion, it is equally absurd to aim at making proselytes by fire and sword. - Publius
Most of my game catalogue is on Steam these days
I remember when I signed up for the Steam service and paid for my first game - it was Half-Life 2, naturally
At the time, I thought it vastly different to the conventional model (and psychological security) of buying your games on CD / DVD at retail. I actually paused before committing to the order.... weighing up the pros and cons of online only distribution when I could just wander down to the store instead
Fast forward to today and, given the choice, I'll elect to buy a game via Steam over any other method. No expanding collection of physical media, no waiting in queues at retail stores where pushy assistants are trying to sell me wares I don't want and - one of my favourite points - no laborious installation processes and/or the need for a disc to be present in the drive to play the game.
I haven't even touched on the low price aspect of Steam which, except for some AAA new releases, sees software available for quite a bit less than in retail stores. I don't think I'm alone in seeing single games or multi-title packs priced at what could be said to be impulse buy pricing.
One thing I would like to know is how the revenue from a purchase via Steam is divided up. Knowing how small a percentage goes to the developer / publisher from conventional sales, I wonder how platforms such as Steam fare by comparison.
Does anyone have reasonably current figures for Valve's revenue and income? A 2005 Forbes story claimed that Valve had an income of 70 million with an operating profit of 55 million. Other sources say that Gabe never accepted venture capital funding and bought out the company's cofounder... Given the relatively few number of employees, Gabe must be loaded.
sony and co (all the large game corps) have all got together and are simply trying to destroy the second hand market which is why they are trying to force us to only accept digital distribution laden with DRM like steam where all your purchases are not allowed to be resold.
they simply want to force everyone to have to purchase new which is why they have continually tried to get us to stop using the PC and move onto the kiddie toy consoles.
but now they are not happy with the consoles and are trying to block second hand games being traded on them.
i hate scum bag anti consumer corporations.
The Truth Is Out There:
You've not had any issues...yet. That's the biggest problem of DRM - people don't have problems at the moment and so assume that all will be rosy in the future. Granted, most media-based 'copy-protection' DRM is trivial to defeat, but it's the phone-home ones that are especially likely to bite you later.
And let's not forget about the subscription based mmo market, as well as the mostly korean freetoplay mmo market, both of these markets being mostly pirate proof, and coincidentally massive.
Piracy occurs on consoles too...
The complexities of gaming on a PC are beyond many people's technical abilities... Having to apply patches, deal with video driver updates or incompatibilities put a lot of people off.
I don't think any publisher ever hated the idea of digital distribution (if only it could be made pirate-proof enough for their taste.)
See, ever since the 90's or so, most of the profit has been made by the retailers. Those make money both from the few games that are a success, and from the complete flops. Even games like Daikatana or Aiken's Artefact (which got great reviews, but IIRC sold a total of 800 copies and nobody knowns why) actually made a bunch of retailers a bunch of money.
See, some of us learned a 17'th century version of capitalism (which is also the version in the game called Capitalism) where the merchant buys a barrel of wine in France for price X and tries to sell it in England for 10% more. (Or 50% or whatever.) And if it doesn't work, hey, the producer got his money anyway. Most of retail in today's post-scarcity economy doesn't work that way. Producing stuff is easy, selling it is hard, and basically as a producer you pay the retailers for shelf space to even carry your product at all. If you made an Aiken's Artefact and sold 800 copies total, congrats, you still pay all those retailers to have it on the shelves.
Worse yet, basically the retailers know how important they are and often get to directly or indirectly got to set the rules for you.
The most trivial example is the current brouhaha over ESRB ratings, which exists because of one single retailer: Wal-Mart. Wal-Mart doesn't carry Adults Only game, 'cause god forbid someone may think that means porn, and that would ruin their BS corporate image. Dumbly enough it's also the biggest retailer. Which left the industry in the pickle of simultaneously arguing (A) not all games are for kids, so fuck off, we can make a game with tits and gutting people like sardines because it's for adults, (B) but this particular set of tits and gutted people is good for 17 years old (or sometimes even 13) because otherwise Wal-Mart won't carry it and we'd, like, not make as much money. (And of course making money overrides and moral considerations. What are you, some kinda commie?)
But, heck, even the E3 exists only because at some point the industry figured out they need a way to woo the retailers. That's right. It never was meant to be a place where nerds get their photos taken with booth-babes, except as a further way to show the retailers "look how many people are interested in our next game."
But generally, you have an industry which for a long while has been squeezed by the balls by the retailers. It had to keep brown-nosing them and paying them for the privilege.
I believe that most publishers would have sold their soul to the devil to get out of that, not just tried digital distribution.
Of course, it also had to be enough of a market share, and give some reassurance that it won't get pirated right off your own servers. Piracy, now _that's_ a bigger scare than the retailers.
A polar bear is a cartesian bear after a coordinate transform.
Steam has done more than offer great prices, they have increased sales. There are several games that I never would have bought if I had to pay full price. I bought Bioshock 1 when it went on sale for $15, which led me to buy Bioshock 2, once it went on sale for $25. Actually, I was going to pay the full $50 and just got lucky that it went on sale. But I have a couple dozen games that I would not have paid $50 for, simply because Steam had a reasonable price on them. A few I have seldom played, but don't feel bad because they only cost $10.
I know I'm not the only one, so it is pretty reasonable to assume that the lower prices drastically increase sales.
Tequila: It's not just for breakfast anymore!
>1. Computers don't go obsolete like consoles do
No, they obsolete faster. A 5 year old PC is not going to run all the new games. A 5 year old console does.
>2. A keyboard & mouse > controller
There are other games besides FPS (for which a controller is better). Racing games, for example.
If Steam goes down due to bankruptcy, or simply being closed down, Gabe Newell (Valve's CEO) said they'd turn off authentication for all games.
Is this patch in escrow? If not, the company that buys Valve's assets at auction might disagree with the plan to turn off authentication.
It used to be the latest/greatest game was really the, well, latest and greatest. Now days, the technology doesn't really change fast enough, and the market is flooded with bad games, so there's no harm in cherry-picking some quality games from a year ago.
For example, when Uncharted 2 came out, I went and bought Uncharted for $19. I finished it in a week or so. Maybe I'll go get the sequel, but I'll wait until it drops in price. In the meantime, I've got more 2-year old games to chose from than I have time to play.