Some-words-in-response-to-Microsoft-s-about-turn-on-used-games Some words in response to Microsoft's about-turn on used games

   24/06/2013 at 17:44       Stephen Farrell       4 COMMENTS.
 - Xbox One, Used Games , DRM, Playstation 4

With Microsoft’s sudden reversal on its XboxOne policies regarding DRM and its “always on” connectivity, the internet has once again gone up in arms. Some people are cheering. Some are saying it’s “too little, too late”. But from a personal point of view the original policies didn’t bother me. In fact, the benefits, (namely library sharing, and the portability of said library) far outweighed the downsides. I’m always online anyway, and I very rarely trade in games. The forced inclusion of Kinect, and the lower-specced but higher-priced machine bothers me still, but that’s another conversation. Please bear in mind I’m not your Joe Public gamer. I’ve been gaming for 30 years now. I’m a collector of sorts. Even so, I still like the *option* of trading in games because those games that I purchased with my money are *mine*. You made them, but now I own them.

What arrogance leads game developers to think that they’re entitled to money from second hand game sales? Although it’s a bit unfair to single out Cliff Bleszinski in this, he has certainly been very vocal about this issue. “I want developers who worked their asses off to see money on every copy of their game that is sold instead of Gamestop. Fuck me, right?” – Well sorry Cliff, no. It simply doesn’t work like that, for several reasons. The profits for the developers and publishers come from the sale of their games in the first instance, to the distributors. That’s it. THAT is YOUR market. EA, Activision, Ubisoft etc DO NOT sell to the public direct. Come the launch of Halo 5 or Uncharted 4 I cannot walk into a Microsoft or Sony shop and purchase the game directly from the company who made the game. There is a long chain between you the developer, and me the gamer. My point of sale is with the retailer only. Yes, I’m the end source of your profit, but I’m very far removed from you.

But that’s only half of the argument isn’t it? The big outcry from many developers is that “pre-owned sales are lost sales”. No. No they are not. They are sales that you never had, and in most cases, would never have had anyway. Having worked in retail management I can assure you that pre-owned sales DRIVE new sales. People will trade in some older games to get the latest triple A title. But how that purchase is made does not concern you, as your sale already occurred, when the distributor bought the games. If the retailer is paid in cash, card, old games or magic beans it does not matter. Furthermore, why do you think with each sequel in a good series that sales increase? Partly because of people playing at friends houses, or borrowing a game from them, and partly because of pre-owned. If you sell 100,000 copies of a game, then it isn’t 100,000 people who play each game. Each game could be played by the friends of the purchaser, and each time it’s sold on your future sale base is expanding. By taking in games and reselling them, the likes of GameStop and GAME are increasing your fan base. In essence they’re advertising for you, for free. Yes, they keep the profits of that resale. They also serve as the end point of your supply chain, and thus get you your profits in the first place, by selling to us. You need these businesses to survive. Also a lot of gamers are young. The average gamer may be a 36 year old male who works 40 hours a week or whatever, but a massive chunk of the gaming market is not at work because they’re in education. And soon they won’t be. Soon they’ll be working too. Alienate them as kids, and you’ll lose them as adults. Kids do not have much money of their own. Oh the bank of Mum and Dad may buy games for them, but they also want to do it themselves. Trade in games to get other games. Get pre-owned games because they’re cheaper. And then come Christmas and birthdays, ask Mum and Dad for the new sequel.

If you want more profits (and I don’t blame you, everyone wants to make money to make more stuff) then you need to either figure out how to make games cheaper to produce, or increase the price that games are sold at along the whole length of the supply chain, or shorten the chain. Plucking figures out of the air here as an example, but if a game is sold by EA to distributor at £20 a pop, then they sell to the retailer at £30 a pop, who then sell it on to Joe Public at £40* a pop, can you imagine the sales that would be generated if EA sold direct to the public at £25 a go? Or what if EA sold direct to GameStop? (I don’t know how the US works, but in the UK there’s at least one distributor between publisher and retailer). Cut the length of the chain and there’s more profit to share.

*(Or as reality has it, the retailer will sell it at not much above cost price. The games industry is poisoned by massive undercutting both online from the likes of Amazon, and in bricks-and-mortar from the likes of big supermarket chains like Wallmart, Tesco etc. Games are used as loss leaders. Smaller retailers, and I include big chains like GAME in this as in real terms they’re still small, simply don’t have the room to manoeuvre on their margins. Without pre-owned, they die. Without them, you die too. It’ll take a while, but it’d happen. And the depreciation of games is shocking. At release Fallout New Vegas was £39.99 RRP, and could be purchased for £34.99, if not less. Within 4 months I saw it for £19.99. Within a year It was £11.99. And this is a popular title.)

Increasing RRP is going to be unpopular let’s face it. No-one likes to spend more than they have to. But the reality is games are dirt cheap. RRP of £40 has been the standard for about 20 years now. Megadrive and SNES games were certainly £39.99 at retail in 1995. There’s been an approximate 50% inflation rate over the last 18 years or so, so why is RRP not £60 now? People will baulk at first about that price, unless it’s made worth their while. Increase the value of the product for early purchases (Seriously, people LIKE extra hats for their avatars! They must cost next to nothing to make. If they don’t, you’re doing it wrong) Support the game going forwards. Early purchasers get some DLC for free. Make day one purchasing worthwhile, because like with Fallout New Vegas, I can wait 6 months and save 50%. Try everything, anything. Make people want your product. Make things simpler; for example season passes. Borderlands 2 season pass was a joke; “Oh you get this and this, but not that and that”. SEASON PASS. That implies you get EVERYTHING. Why restrict things in one region and not another? We have simultaneous world wide releases for things now a days. People expect it. Why treat one region differently than another? (Although admittedly the removal of regional locks is a nice step forwards. Well done, only took best part of 20 years).

Historically I have pirated things *because I couldn’t purchase it*. I’m literally saying “I want you to take my money for your product” and I’m (in effect) told “Oh we can’t take your money, we don’t want this product in your region” as if the UK is not good enough to have said product. The world does not revolve around America, or Europe, or Japan, or the UK. We are gamers, period. Worldwide. Support us when we purchase your games, and we will support you by buying them. And this is about US, not YOU. *WE* have the buying power, ultimately. You do not. If EA make a bad choice it can cost them millions. Millions to one company is a lot of money. It can make or break them. Millions to a million gamers is pocket change. The sum total of gamers money is the sum total of all the companies (or divisions of) in the market combined. You need to appeal to us to purchase your games. So make it worth our while. We are the end users of your profit chain. Treat us with respect. Talk to us and we will respond. Ignore us and things will go very badly. E3 wasn’t “won” by Sony because of the content of their presentation, or because of Microsoft’s very unpopular reveal regarding DRM etc, it was because they treated gamers with respect, and talked to us as human beings, not talked at us as little sacks of money to be exploited. Yes we’re sacks of money, but ask us nicely to give it to you, give us great stuff in return, don’t be cagey or dodgy with the products you’re trying to sell to us, stop trying to control what we do with our products and we’ll hurl money in your direction. We want games! We want cool stuff! We’re geeks! Give us geeky stuff! Don’t try to tell us what we can and cannot do though.

As for online support and the likes of EA’s (now defunct) online passes, if you sell 100,000 copies of a game, then you have to support 100,000 players. It doesn’t matter who they are. It doesn’t matter if they change hands. You have 100,000 sales to support. Support them. Technically (And wrongly) not correct, but it’s nice to think that from a publishers point of view we do not purchase the game, we purchase the licence to play the game. Therefore you have to support the licences only. Your concern is how many licences are out there, not who owns them. Your mistake is in the law, that licences aren’t transferable. Why? What solid reason is there for this, except as a way for companies to get more money, and to have control over us, the users?

A lot of the arguments above can be killed off in one word: Steam. The original XboxOne policies were not far short of “steam in a box” which many will agree is a good idea in principle. But here’s the catch; steam isn’t the only option. If I want to purchase games for my PC I can go to a retailer and buy a physical copy. Or I can shop online and buy a physical copy. Or I can even go to another online digital provider and buy games. I have choices. But if I wanted to play on an XboxOne then I had to abide by your rules, and had no other options. Play your way, or don’t play. Lastly, there’s the physical element. Human beings are by their very nature materialistic. What we can see we believe in. What we hold when we buy something, we own. You might not like this, and the law may have been drafted to make this the case on a technicality, but it doesn’t make it *right*. Lawful does not always equal *right*. It frequently means what’s right for the people in power, where matters such as money are concerned.

If an artist sells a painting, he doesn’t get proceeds from every further sale as the painting passes hands. Ford do not get a cut of the sale if John sells his car to Peter. This happens in NO INDUSTRY. Not one. Why do some people, developers and publishers in particular think that the gaming industry is different? I can tell you what is special about developers and publishers alike; Absolutely nothing.

User Comments:

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Bremenacht - on 24/06/2013 at 20:07 wrote:
 
Second hand sales are competition. Competition helps keeps prices in check. Therefore, competition must be eliminated.

Steam doesn't attempt to kill competition. It just competes, better. Which is why us consumers love Steam.

EA et al just don't get this. Are there any other companies with a bigger sense of entitlement?
 

Lutzie - on 25/06/2013 at 09:45 wrote:
 
Since writing this piece this line is also now redundant: " (namely library sharing, and the portability of said library)" as it looks like it's just a demo library of sorts.
 

Ace Grace - on 25/06/2013 at 11:34 wrote:
 
What are your views as a collector with digital purchases. After all once the servers are turned off, bye bye to the games.
 

Lutzie - on 25/06/2013 at 11:42 wrote:
 
When I say I'm a collector of sorts I don't quite mean of all games in general. See, I like digital content. I have purchased probably 30 games on XBLA. (Most recently Sonic CD for 160 MSP which is about 1.20 and a friggin' steal).
But I do buy the collectors editions of games. The Skyrim Dragon. The Master Chief Cat helmet. Both of the Fallouts etc. Things like that. That's the sort of stuff I like. If stuff like that continued, but with digital only copies, I'd be pretty miffed to be honest. I can't see me forking out 99.99 for Halo 5 plus statue, plus mini art book plus digital only copy of Halo 5. I'd want the disc.
But I'd certainly be interested in one that offered physical and digital.
 


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