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DRM-Free Game Suffers 90% Piracy, Offers Amnesty
bonch writes "Independent game Machinarium, released without DRM by developer Amanita Design, has only been paid for by 5-10% of its users according to developer Jakub Dvorsky. To drive legitimate sales, they are now offering a 'Pirate Amnesty' sale until August 12, bundling both the cross-platform game and its soundtrack for $5. Ron Carmel, designer of DRM-free puzzle game World of Goo, stated that his game also had about an 80-90% piracy rate, claiming that the percentage of those pirating first and purchasing later was 'very small.' He said, 'We're getting good sales through WiiWare, Steam, and our website. Not going bankrupt just yet!'"
The 90% piracy rate is quite much the norm with PC games. The sad thing is that PC gamers will destroy their own gaming platform by doing so. Good example is Modern Warfare 2 which was heavily "consolised" and you have to admit, not having dedicated servers and everything else sucks.
This also shows that the usual argument that warez versions of games are good to get to know the game before you buy it or that you would rather support indie developers and "small guys" are mostly bullshit. These indie game developers also have a 80-90% piracy rate.
But you know what the next step to prevent piracy will be?
Fully online games. You can already see this with the Ubisoft's DRM, the recent Starcraft 2 and the movement to multiplayer, co-op (left4dead), and mmo games. Personally I actually enjoy playing with other people especially in a good co-op game, but there are those who prefer single player games. I prefer with games like Civilization too. But ultimately this piracy will lead to most serious developers just to publish fully online games like World of Warcraft. While you can play it freely with piracy servers, it's really far from the real experience. Game developers will also look more into console development, because for example you still can't pirate games for PS3.
Let's say you release a DRM-free game and it attracts 1,000,000 players, 100,000 of whom pay you. The question you should be asking isn't "how can I get money out of the 900k people who are playing but not paying" but "how many of my 100,000 paying customers would I have lost had I released it with DRM". DRM reduces the value of your product; getting rid of intrusive DRM adds value. I can't tell you how many games I've bought at full retail and then promptly downloaded a crack or no-cd patch because the DRM got in the way of me enjoying the game I just paid for.
DRM is a fantasy. Snake oil. It doesn't work. It's been proven time and time again for the last 25 years. EVERY copy protection system ever devised has been defeated quickly. You can't stop people from copying software by any means short of crippling the hardware, and (as the jailbreakers and console modders have shown) even THAT doesn't work in the long run.
Why is it that the proponents of "one nation under God" are so eager to get rid of "liberty and justice for all"?
Is there an online part to this game? Can they see 10-20 times as many players online as how many have paid?
Or did they just find it on some torrent site and multiplied the number of downloads by a 1000 (and assumed they all liked the game and are still playing it)?
We are all God's parents.
Follow the logic...
Piracy = !Bad
Piracy = Copyright Infringement
GPL = Copyright
GPL Infringment = !Bad
Well, I'm off to infringe the GPL as it's not bad to do that apparently.
It's called a price versus demand curve. As the price tends towards zero the demand increases infinitely. Since there are practical limits, demand at free plateaus at about 10x demand at the original price. This isn't about people being able to afford the games. They just don't value these games at their original prices. There's nothing you can do about it. DRM'ing the game to high heaven won't make those people who don't value the game suddenly purchase it. You're not going to suddenly increase your sales by an order of magnitude. You likely won't even increase it, unless you lower your prices. That's why those ridiculous sales on Steam are so popular. Highly rated games for incredibly cheap prices on holidays or whatever other special day comes up attracts lots of customers.
I'm not saying game prices are too high. In fact based on the rate of inflation I'm worried that the gaming market will bottom out as publishers are unable to raise their game prices to even match inflation, let alone the increasing costs of game development. But that "90% piracy rate" is totally misleading. These are not people who would have bought your game had DRM been implemented.
So what?
The "piracy rate" is a totally bogus number. It doesn't mean anything. Most importantly, what it definitely not means is "lost sales". You can't do mathematics with an illusionary number. It's like me saying the Bogeyman number is 12.5 - it doesn't mean anything. You can't say "oh wow, that means for today (8h), I earned (8*12.5 = 100) a hundred dollars!" Uh, no. Same thing, taking a "piracy rate" number and multiplying it by another made-up number (say, "potential conversion rate") and then multiplying it by an arbitrarily set number-with-unit (sales price) to arrive at a totally made-up number and then call that "loss due to piracy" is just dishonest.
I'll be interested in the results of this guy, but my guess is any additional sales have nothing to do with piracy and everything with advertisement.
Do yourself a favour and step away from this movie-and-music-industry created phantom that piracy == lost sales. There is something called "structural unemployment", to use a non-car metaphor. What it means is that you can never, ever, have 0% unemployment. There are always people without a job, even if there are a hundred open positions for every person looking for one. You have people on the move, people who just quit and haven't yet signed up for a new one, some people are just impossible to employ, and so on. You always have some unemployment that you can not get rid of no matter what you do (aside from playing statistics tricks).
Same thing with piracy, just on a different scale. No matter what DRM you use, no matter how low the price, no matter what else, there will always be people who don't pay for your game.
I've said this before. Think about your players as being in three groups:
1.) the ones that will certainly buy your game
2.) the ones that may or may not buy your game
3.) the ones that will certainly not buy your game
where 3.) includes the pirates. People who download your game from a torrent have all sorts of reasons to do so, most of them you can't do anything about. My advise is to ignore them and focus on the undecided bunch. The ones who may buy the game if you can catch their interest. Which you more likely do with more polish than with better DRM.
And yes, I do sell stuff online. I don't care about pirates. The extend of my "anti-piracy" measure is that you get the download link after paying, and that's it. Any and all DRM is a waste of time and money.
Assorted stuff I do sometimes: Lemuria.org
And ya, that's the real question. We know people pirate games, both with and without DRM. The question is does DRM make a statistically significant difference in piracy rate? If it doesn't then it is de facto worthless. After all the only reason to have it is to reduce piracy rates so if it doesn't why have it?
Now, if the answer is it does lower the piracy rate by a non-trivial amount the next question is does it increase sales? Less copies being pirated doesn't mean more being sold. You have to check it both ways. Unless you are generating more sales, it doesn't do you any good either.
So assuming it does increase sales, then the final question is does it increase sales enough to cover the costs of DRM. There are three main costs:
1) The cost of the DRM itself. Off the shelf DRM solutions cost money up front, and generally royalties per copy sold. If you develop your own there is the cost you pay developers to work on it. In both cases, there is implementation costs.
2) The cost of support. People will have trouble with it, you'll have to have support staff for it. You cannot very well sell someone something that doesn't work due to DRM and say "Oh, sorry, nothing we can do."
3) Lost sales due to people who don't like it. I don't know how big that is, but it does happen. I personally will not buy any new Ubisoft title. Both Settlers 7 and Assassin's Creed 2 were on my list until their new DRM came out. No, I haven't pirated them, I just play other games (I've got about 40 games on Impulse 50 on Steam and more in boxes).
So for DRM to be worth it, it needs to cover the costs of implementation and then some in terms of a sales increase. What I would like to know is if it does this. I don't know that any company has studied it. they mostly seem to take on faith that DRM works.
needless to say, Koreans are in the right here
you don't pay royalties to the manufacturer of the hammer you used to build a house and sell it with profit. You paid for the hammer - that's it.
KeSPA did all the legwork to set up everything and now blizzard comes in and says 'pay up, bitches, you use our game'. Yeah, but they don't sell a game, they sell competition between players. Game is merely a tool, 50 bucks a pop.
It's distasteful because greatly Blizzard benefited from increased sales for years thanks to the tv coverage and didn't have to pay a dime for that. Easy money. They got the best marketing possible for free and now they want the cut on top of that.
Someone needs to step in and smack the software industry hard. They do anything they want because they can put whatever in their EULAs and ToSes and with no resistance circumvent common sense, basic user rights, first sale doctrines and whatnot.
http://2dboy.com/2008/11/13/90/
I haven't played the game, nor purchased it, but I have a big problem with their statistics: They basically took the unique IPs and divided by the number of sales. That might have been somewhat accurate in the 1980s.
It's utter rubbish. People often have laptops. Today, my laptop will have at least 2 IPs. There are days that I've had 5 different ones, from different locations. (Actually probably more than that, considering that the university likes to subnet by building, which probably means that there are another 2 IPs. (possibly per day, unless their DHCP assigns the same one))
So if I'd purchased the game, and played it on my laptop at various times throughout the day, over a week, I could very easily account for 10 IPs alone. The same methodology applied to Steam, could easily lead to Steam being well over 50% pirated.