Has gaming hit a wall due to piracy?
- Thread starter Proton Packmule
- Start date
The development of high end games is hitting a wall because they can get away with regurgitating the same products that they have been releasing the previous few years and make greater profits.
That and the hardware limitations of consoles, they should have released a new generation already or at least have one soon.
That and the hardware limitations of consoles, they should have released a new generation already or at least have one soon.
Oh come on now, the game industry is growing by leaps and bounds every year(the recession may have sloved it, but it still grew), for the first time it's making more money then frekin Hollywood, noone was ever expecting that, and yet game studios will spew out ridiculous claims how they lose money on every turn.
- first it was piracy (with all it's made up figures)
- then the second hand market (Killing the gaming industry! Every other item is ok to resell but games are a huge issue...)
- and game sharing (again killing the industry...)
It's time to think before believing all the PR they put up, because they do it only to milk money from you, and if playing on your morals works that is what they will do.
- first it was piracy (with all it's made up figures)
- then the second hand market (Killing the gaming industry! Every other item is ok to resell but games are a huge issue...)
- and game sharing (again killing the industry...)
It's time to think before believing all the PR they put up, because they do it only to milk money from you, and if playing on your morals works that is what they will do.
There absolutely are many ways to "beat" pirates. As long as you don't have an absolutist definition of "beat," that is.Garak73 said:
Beating piracy doesn't mean eradicating every pirate, or every instance of piracy, or every possible means of piracy. Beating piracy just means delaying it long enough for the on-the-fence folks to choose to buy the game, to ensure the profitability of the game. And that's a hard thing to do, especially when the wannabe-activist pirates thrown dollar signs around like they understand math.
"This game sold 5 million copies!" - Okay. For how much--say $60. That's a total of $300 million. Wow--sure sounds like a lot, doesn't it? Okay... but it likely cost around $100 million to make, as is the case with Starcraft 2. So, that number is already reduced to $200 million. Next up: the point of sale (be it store or digital distributor) gets some money, too. For the sale itself, let's say they make about $10 per game--a tight margin, but pretty plausible. There's $50 million right there. We're at $150 million.
They also have to pay for other things as they go. If it's a large release, they may have to rent shelving at the stores. Continuing to run ads costs money, too. They have to pay to keep the game up and running, and to squash bugs and exploits as they arise, which means continuing to pay the staff. So that's going to steal a few million in no time at all.
So let's say we've still got $150 million left. What's that money for? Pure profit? Not quite. Some of that is going to be needed to reinvest in the next project. The publisher just shelled out $100 million to make this game, and they've gotten back $150 million. That's a profit of .50 per dollar, which isn't bad, but there are plenty of folks that expect them to be happy just making their money back... how would that make their shareholders feel? Would they be likely to reinvest in the next couple of projects?
Also, how many other projects does that publisher have going on? How many of them are having shortfalls that this $150 million helps to cover? How many people do you have to spread that $150 million out to--which is already not $150 million, due to the factors listed above? Oh, and taxes.
You misunderstand. In my example, I'm saying the point of sale makes $10 per copy. That would mean the publisher in my example is making the other $50. I base this on the fact that different games and companies operate with different margins, so I just chose one that was on the high end for the publisher. So, actually, going back and fixing the math using your estimate that the publisher only gets $30, things end up different.veloper said:
Sales from the 5 million copies still total $300 million, if sold at $60 a piece (before sales tax). The cost of development brings that down to $200 million. The point of sale is (by your reckoning) making half of that ($30 a copy), bringing it down to $50 million. And, as I've said, that's still not clearly profit yet.
There's the cost of supporting the game with patches, servers, customer service reps, advertisements, shelving space at retailers (which is often a cost that is separate from the sale price of the game), and some of that has to be set aside for investment in the next project(s) that will probably cost $100 million themselves.
Most businesses also deal in far, far greater volume than video game publishers. Either this, or they deal with items like automobiles that represent far longer-term investment in each customer, and have all other peripheral revenue streams, tax breaks, etc., that feed the maker. Video games, like a lot of other entertainment, need a bit more back based on their project-to-project nature.
It hasn't hit a brick wall, but it certainly has effected the gaming industry.
If the gaming industry want us to purchase games legally, then give us a reason to? I'm sick of jumping through hurdles just to play a game, when I can just get it from a torrent site a million times easily and it saves me 50 - 100 bucks.
I'll be honest, there are some company's who I will pirate there games. Only a few however, but I do it because they make it a mind fuck just to play there games just because they make you go through a mind fuck just to play the game as a lame attempt to stop people from pirating. I'm aware it ain't helping the situation, but why should I give a shit??
Gaming company's who make blizzard games, fallout 3(although there games are a tad glitchy), rockstar games, and lots of companys like that, I feel as though they give me a reason to purchase games. I like supporting them, it makes me feel good. But there are simply some gaming companies who are all about the money.... and you can tell (Arguably all video game companies are for the money, but there are some companies who go to that extra level..)
If the gaming industry want us to purchase games legally, then give us a reason to? I'm sick of jumping through hurdles just to play a game, when I can just get it from a torrent site a million times easily and it saves me 50 - 100 bucks.
I'll be honest, there are some company's who I will pirate there games. Only a few however, but I do it because they make it a mind fuck just to play there games just because they make you go through a mind fuck just to play the game as a lame attempt to stop people from pirating. I'm aware it ain't helping the situation, but why should I give a shit??
Gaming company's who make blizzard games, fallout 3(although there games are a tad glitchy), rockstar games, and lots of companys like that, I feel as though they give me a reason to purchase games. I like supporting them, it makes me feel good. But there are simply some gaming companies who are all about the money.... and you can tell (Arguably all video game companies are for the money, but there are some companies who go to that extra level..)
The 300 isn't at the publishers end, so it's not +300-100=200.dastardly said:
At the publisher's end in this example it's $100 invested and $150 revenue, making a nice +50% profit.
The game doesn't cost $30 at the consumer end, because there's a retailer (or Steam) taking a cut (and in the case of console games, M$ or Sony taking a cut), bringing the price up to a total $60 at the consumer end.
50 million profit is profit.
The support and service generally being the lousy anyway, I doubt it costs much in the grand scheme.
Advertising is indeed a big expense, so we may want a new example with the cost of advertising included.
The retailers are already covered in the $60 figure; they've already had their cut.
Reinvesting profit doesn't make it any less profit. It's what you DO with profit, to make even more profit.
Also 100M is a very high mark. 20 million is a more common figure for the cost of a triple-A game.
The car industry is murderous, with low profits on big expensive goods, a constant need to innovate and too many competitors all over the world kept alive on government funding as prestige pets.
The film industry officially never makes any profit at all, but admittedly that's part of the way they do their accounting in Hollywood.
Game publishers have it easy by comparison.
And if you happen to be Activision-Blizzard you're sitting on a gold mine. Everything Blizzard touches has always been gold.
Yeaaaahhhh after the crazy fucking sales of Call of Duty Black Ops, I'm doubting piracy is really even much of a threat to any industry anymore.
The problem with piracy is that companies view every pirated copy as a lost sale, but this is really the only thing they can do with the figures; it's pretty difficult to estimate how many pirated copies led to an actual purchase (and it's nowhere near as many people who say they do actually do it).
Unfortunately the root they tend to take is the wrong one, which creates more pirates, which is also wrong. With Steam Valve curve it as much as they can by offering more and more for your money - great sales, a superb platform, a huge community, etc. etc. and accept that there's not much more they can do about the issue.
Pirates are in the wrong, and there's simply no question of that, but publishers need to accept that they're not going to eradicate it and look at how they can encourage the purchase of games.
It's not hindering the industry overall, but it's certainly an issue where the two groups involved won't budge and it's often making things worse for those of us who aren't thieves.
Unfortunately the root they tend to take is the wrong one, which creates more pirates, which is also wrong. With Steam Valve curve it as much as they can by offering more and more for your money - great sales, a superb platform, a huge community, etc. etc. and accept that there's not much more they can do about the issue.
Pirates are in the wrong, and there's simply no question of that, but publishers need to accept that they're not going to eradicate it and look at how they can encourage the purchase of games.
It's not hindering the industry overall, but it's certainly an issue where the two groups involved won't budge and it's often making things worse for those of us who aren't thieves.
When I was younger (and considerably poorer), I would "Try before buying". Honestly, I rarely made it through the first stage of many games - they bored me that much. Others that hung around generally got bought. It didn't help that stores had a "you buy it, you keep it. We won't take a return" - that left minimal options for PC gamers. Console gamers could at least rent a copy from the local blockbuster.
I would say that a large percentage of people are in the same boat - they are slightly interested in a game, but have no way to actually *try* it without dropping $60 for it, as it is pretty rare for a (PC version) demo to be released these days.
That doesn't leave many options - drop $60 and really hope you like the game or download a cracked copy and give that a go.
Oh - and EA SPorts (NHL, in particular) stopped getting money from me years ago with their system of updating rosters and fresh coats of paint on the menus, not to mention skipping AI updates that were showing up on the console versions. If I buy an EA game now, I make sure I'm buying a used copy.
I would say that a large percentage of people are in the same boat - they are slightly interested in a game, but have no way to actually *try* it without dropping $60 for it, as it is pretty rare for a (PC version) demo to be released these days.
That doesn't leave many options - drop $60 and really hope you like the game or download a cracked copy and give that a go.
Oh - and EA SPorts (NHL, in particular) stopped getting money from me years ago with their system of updating rosters and fresh coats of paint on the menus, not to mention skipping AI updates that were showing up on the console versions. If I buy an EA game now, I make sure I'm buying a used copy.
Developing a game involves front-loaded costs. Companies either get funding to cover development costs from venture capitalists, another company (large publishers, for example), or for a lot of the indie devs, their own savings. VCs and publishers are expecting a level of return on their investments, given that their money is now tied up for a certain amount of time and isn't earning them anything in another profitable endeavour.
If VCs or publishers don't receive what they consider an acceptable return, then that company won't be getting money from them to develop additional games. If they feel that piracy is damaging their potential profits, they will pressure the developer to take action to counter this, or face a loss of funding.
Companies that have had successful games in the past may then use those profits to create additional games, either to avoid having to portion out a potentially sizable chunk of profits back to investors, or just to supplement existing investment funds. They likely already have a bunch of additional ideas for games, but what actually gets developed depends on how much they think it will cost to make, and whether they feel they can profit from it enough to continue with other ideas after that. The pressure to lean towards larger volume, safer concepts becomes greater, and you get more of what gamers seem to complain about the most: sequels, derivatives, and all around lowest-common-denominator play.
You may personally feel the industry takes no damage from piracy, but the people who actually fund the industry do, and that in turn, affects the people who make the games. If the people who play games don't want to fund the industry, then more of it will be run by those whose concerns lie with the bottom line, and you get the continued trend described above.
If VCs or publishers don't receive what they consider an acceptable return, then that company won't be getting money from them to develop additional games. If they feel that piracy is damaging their potential profits, they will pressure the developer to take action to counter this, or face a loss of funding.
Companies that have had successful games in the past may then use those profits to create additional games, either to avoid having to portion out a potentially sizable chunk of profits back to investors, or just to supplement existing investment funds. They likely already have a bunch of additional ideas for games, but what actually gets developed depends on how much they think it will cost to make, and whether they feel they can profit from it enough to continue with other ideas after that. The pressure to lean towards larger volume, safer concepts becomes greater, and you get more of what gamers seem to complain about the most: sequels, derivatives, and all around lowest-common-denominator play.
You may personally feel the industry takes no damage from piracy, but the people who actually fund the industry do, and that in turn, affects the people who make the games. If the people who play games don't want to fund the industry, then more of it will be run by those whose concerns lie with the bottom line, and you get the continued trend described above.
They've had this kind of anti-piracy for years and the haven't used it yet. Its simple, every time someone tries to use an illegal copy, our old pal DP comes on the screen and tells them its wrong, and he is persistent, he doesn't take no for an answer.Altorin said: