Why pirating doesn’t hurt video game developers
I can't really believe that I haven't updated in quite awhile; summer classes and getting a new job sucked the free time right out of me. Anyways, enough about my lack of updates.
Lately, video game publishers have citied declining retail sales as how piracy is directly hurting them. Well it seems that retail sales are only suffering because the increase in digital sales. According to the NPD report, digital download sales trailed closely behind physical box sales (21.3 million vs. 23.5 million respectively). During that same period, PC digital download sales made up to 48% of unit sales and 36% of dollar sales. So while retail sales may be declining, it's not necessarily because of computer video game piracy.
The big problem with trying to correlate X million in illegally downloaded games to X million in lost sales is that it simply doesn't work like that. There is no quantifiable number or study out there that shows a direct correlation between those numbers. So when you see these "studies" that claim piracy costs an industry millions in lost revenue, it's simply a load of made up numbers. In fact the U.S. Government has basically admitted that most piracy estimates are bogus. The Government Accountability Office said that it is "difficult, if not impossible to quantify the economy-wide impacts". What video game publishers should be doing is stop blaming piracy for their lack of sales and look at from a different angle.
See, since a video game publisher can't link a download to a lost sale, they should instead start looking at how they can make piracy work for them. Obnoxious DRM like Ubisoft's-always need to be connected to the internet-only affects the customers who pay for the game. Remove the costs of developing that DRM and accept the fact that people will download your game illegally. Take that saved cost to make the game cheaper or find a way to connect with your fans and give them a reason to buy. Look at indie game developers who embrace the fact that DRM is a failure and still make money from their game (Humble Indie Bundle). How many legitimate users is it ok to inconvenience in order to reduce piracy?" The answer should be none. Fans want to support artists, so who is to say that video game developers can look at experimenting with a new model revolving about a CwF +RtB model. Pair the infinite goods-namely a video game or such- with a scarce good to give more value.
Bottom line, video game piracy does somewhere between zero and slightly nothing in terms of damage to a developer. Think of video game piracy as word of mouth advertising for a game (the best, since it's free); all those "millions" downloading it are going to play it and recommend it to their friends to pass it along. Outwards those others may pay for it, or they may not. But by getting the (hopefully positive) word out, there is a much larger audience to connect with to give a reason to buy the video game. Look at successful crowd sourced projects for movies and tv shows that use places like The Pirate Bay to distribute their shows for free, and then generate money for additional content from fans who want more.
Make something that fans want to support; this means games that aren't rushed out to meet a deadline and buggy as all hell. Times are changing, and video game publishers should change with the times or become extinct like the dinosaurs. They can look at piracy in a different light and how they can use it to their advantage.
August 20th, 2010 - 09:28
btw a tip: if you want to remove DRM,this tool works like charm (if links dont work its ultimatedrmremoval.com)
November 5th, 2010 - 14:36
You hit the nail on the head, I wouldn’t pay money for any of the crap that I illegally download.
November 20th, 2010 - 19:52
The companies do have to do something about it though. Maybe looking at subscription based revenue streams is the answer, like WoW.