Close
Report Comment to a Moderator Our Moderators review all comments for abusive and offensive language, and ensure comments are from Verified Users only.
Please report a comment only if you feel it requires our urgent attention.
I understand, report it. Cancel

Safe Haven

Fri 02 Dec 2011 7:30am GMT / 2:30am EST / 11:30pm PST
Business

Piracy is infuriating and upsetting - but never forget that your job isn't to wage war on pirates, it's to seduce your customers

One of the problems with the debate around piracy is the lack of any meaningful figures. The word "meaningful" is important here - after all, the discussion is absolutely chock-full of figures, which are flung around as alleged proof of whatever point their wielder happens to be promoting at that particular moment in time. The reason they can be used so flexibly is because they're enormous, headline figures, designed to shock and awe, with no granularity or research behind them - and usually supported by a fairly questionable methodology in the first place.

As such, it's healthy to maintain a certain degree of suspicion when you're confronted with figures like those released by CD Projekt RED, developers of The Witcher 2, in a recent interview with PC Gamer. The Witcher 2, CEO Marcin Iwinski revealed, has sold over a million copies - but it's been pirated over 4.5 million times.

The first of those figures is broadly trustworthy, of course. Companies know how many copies of their products they've sold, even if it's sometimes to their advantage to obfuscate those figures - witness platform holders who love to blur the lines between "shipped" and "sold" figures, or publishers who have historically (and the practice no doubt continues today) deflated sales figures for software in order to dodge royalty payments to developers.

The point isn't that we should be questioning the "1 million sold" figure - as I said, it's broadly trustworthy - but that numbers aren't the reassuring rocks of factual stability that many of us would like to believe. In the games industry as in any corner of the economy, numbers are just as much a part of the PR narrative as words are; one can twist a number to your ends just as easily as a word.

Watching bits of data move between IP addresses tell us nothing about the people doing the downloading - about their motivations, their finances, their locations

In fact, numbers are an even more powerful tool of spin, since almost every form of education in the world indoctrinates us in the Victorian idea that where words are vapour, insubstantial and unreliable, numbers are bricks - solid, immovable and possessed of an intrinsically factual nature which renders them impervious to the conniving efforts of the spin doctor or the PR man. This has never been the case, but it's a tough belief to shift.

This being the case for relatively simple figures such as sales figures, imagine the size of the pinch of salt with which figures for piracy must be taken. Piracy by its nature takes place in a veiled environment. Files are distributed over many different types of media and connection. The nature of the technology used is itself obfuscatory; BitTorrent, the most popular distribution method, operates "swarms" of users, some of whom are downloading, some of whom are uploading, some of whom can't be seen, some of whom are duplicates of others and some of whom aren't even real. It's a quagmire that produces no truly useful statistics.

Iwinski, to his absolute credit, acknowledges this factor and is transparent about the flimsiness of his statistics. His 4.5 million figure is based on a set of averages and assumptions which hold little water. He knows that and makes no bones about it - all he wants to prove with the figure is that the number of copies downloaded was "a lot". That hasn't stopped the media from breathlessly reporting the results of his paper napkin calculations as cold, hard fact.

It might not seem all that important to acknowledge that a figure like 4.5 million is necessarily an estimate that could be wildly inaccurate in either direction. Plenty of people in the industry are happy to shrug and say, "it's a lot - what else matters?". Yet for years, we've had figures calculated on flimsier evidence than this which have entered into the realms of canonical information; they have been used as the basis for further calculations on things like impact on sales or even job losses, and waved under the noses of legislators and bureaucrats in support of draconian legal reform.

The reality is that numbers like this don't tell us anything worthwhile. They don't tell us how many times a game has been illegally downloaded, beyond "quite a few times". More importantly, rough estimates gleaned by watching bits of data move between IP addresses tell us nothing about the people doing the downloading - about their motivations, their finances, their locations. There's not even the shadow of an attempt to glean more granular data, and nothing upon which to base such an attempt. We don't know how many of those downloaded games went into the hands of children, how many to adults. How many of those who downloaded had credit cards that could be used to buy the game legally online? How many lived in territories where they couldn't access it? Indeed, never mind this kind of detailed information - how many pirated copies of the game were actually installed, and how many still languish, untouched, on the hard drives of compulsive digital media hoarders?

Iwinski and his company understands his job is not to wage war on the pirates, it's to nurture and grow the audience of a million paying customers

I'm not saying that those factors materially impact on the piracy figures - I'm simply saying that I don't know the answer to those questions, and no matter who you are, nor do you. As such, phrases like "lost sales" or "lost revenue" are next to meaningless; they're statements of ideology and PR rather than statements of fact. Of course it's annoying to see work you've done being passed around for free, but if you're in the business of content creation, your job involves rising above the natural gut reaction of "those thieving bastards!" and thinking about how to approach this market reality in a way that secures your livelihood.

This is why it's so exasperating to see self-styled captains of our industry who still haven't moved past spouting off ideological tirades against piracy. Yes, it's illegal, and yes it's wrong, but it happens and it's your job to find a way to adapt your business to cope with that. In a digital world, the unit cost of items which are free to duplicate tends towards zero. That's a flat reality, and your wailing and gnashing of teeth singles you out as nothing more than a dinosaur who doesn't have the imagination to see past that reality. The thing you ought to be scared of isn't the pirates - it's the fact that our industry also has lots of small, intelligent mammals running around, with clever ideas and brilliant insight, and they'll be happy to inherit the world when you're extinct.

Iwinski and his company, happily, are among the mammals. Faced with 4.5 million pirates (maybe, possibly, who knows?) and a million paying customers, he understands his job better than countless others in the games industry do - it's not to wage war on the pirates, it's to nurture and grow the audience of a million paying customers. DRM, which hurts customers and is easily bypassed by pirates, is dispensed with. Ideas which add value to the game for the people who love it - collector's items, special editions, and so on - are promoted. Spending time hating the people who steal your game detracts from the amount of time you have to love the people who paid for it. CD Project RED gets that. So many others in our business have so very much to learn from them.

17 Comments

Bruce Everiss Marketing Consultant

1,692 594 0.4
We have a profligacy of platforms, so when piracy damages our business model just switch platform.
This is what the industry has done ever since the debacle when the original Playstation was pirated so badly.

Then the customers also switch to the platform where the games are and the pirated platform fails.
So it is in the very best interests of the platform holders to institute rigorous technical and legal anti piracy measures.

At the end of the day a game console is just an anti piracy dongle, otherwise we would all be using the latest version of the Commodore Amiga and Atari ST.

Posted:2 years ago

#1

Morville O'Driscoll Blogger & Critic

1,576 1,419 0.9
Firmware updates as DRM is both annoying to the user (unless, in the same firmware, there is vastly improved UI, extra features, etc), and fairly easily bypassed (if only by not updating the Firmware).

Contrast with the multiple DRM on Batman: Arkham City PC (as an example), which still hasn't been cracked (circumvented, yes, but not *cracked*), and we have a situation where piracy on the PC takes a back-seat to piracy on the modern console.

I would also argue that it is in the best interests if of the industry to create better games - people blame piracy when a game fails, but when the game is sub-standard, it's easy to assume your lost sales are from pirates; harder is to accept that the game you spent lots of money developing and promoting just isn't that good.

Using Arkham City as another example - it's an exceptional game, but it should have been released on all platforms at the same time to ensure maximum sales. The ostensible reason it was delayed on PC was to add DX11 support. DX11 mode is broken (that is the official word from the publishers, btw). So, not only have consumers with multiple platforms in their homes already played it (possibly purchasing it second-hand from HMV, thus losing WB money), but the PC support is bad enough that if someone were to Google whether to buy it on PC or console, they would end up buying it on console.

PC sales will almost certainly be less - will pirates be blamed, or will the publishers/developers hold their hands up and say "Sure, we cocked up"?

Posted:2 years ago

#2

Nicola Searle Senior Knowledge Exchange Associate, University of Abertay Dundee

24 0 0.0
I'm so pleased to see that the dialogue has shifted from "we lost X amount of money due to piracy" to questioning inflated statistics and looked at more fundamental problems.

There is no question that piracy is a problem, but it's been a distraction from more pressing issues such as innovation.

Posted:2 years ago

#3

Bruce Everiss Marketing Consultant

1,692 594 0.4
@Nicola

I was at Codemasters when 20% of the workforce were made redundant because of Playstation 1 piracy.
It seemed much more important to us than innovation then.

Posted:2 years ago

#4

Morville O'Driscoll Blogger & Critic

1,576 1,419 0.9
@ Bruce

How to say this without sounding unsympathetic...

Can you say catagorically that the 20% redundancies were due to piracy? Because it seems like you're ignoring the word-and-spirit of the article, especially the point where Rob says "How many of those who downloaded had credit cards that could be used to buy the game legally online?" Just because pirates pirate, does *not* mean you lost a sale.

Also, a Google search for roughly the period you were at Codemasters (2000-2002?) finds this:

[link url=http://www.combatsim.com/memb123/cnews/arch/cnews-arc18.htm#code90
]http://www.combatsim.com/memb123/cnews/a...[/link]

Which states "current market conditions" as the reason for axing 90 jobs. Unless you can definitively state that the reason for these (or any) redundancies was piracy - which I would've thought impossible given the unknown statistics on piracy vs lost-sales, and other factors at play within the video-game market (disposable income, quality of games, etc) - then you're merely using numbers to muddy the waters of this argument.

Posted:2 years ago

#5

Benjamin Seeberger Writer/Translator

28 18 0.6
Honestly, the best route to fighting piracy is through ISP enforcement. Holding ISPs accountable to what people download using their services is really the best route to discouraging "popular piracy" (as compared to the normal act of stealing any amount of goods, from Snickers to gold mint).

I can't see DRMs as being feasible over the long-term, because of instability issues (Steam seems to follow a law of diminishing returns in respect to the amount of issues that is coupled with it with every game added to the database). That, and pricing structures should be changed to reflect the prices of not creating packaged materials (although I'm no expert in this; server costs could cost just as much these days as printing color instruction books and copying DVD discs).

While it's true what Iwinski says (it's not so different from a novelist needing 1000 fans in order to stay afloat), it's unrealistic because most developers shouldn't have to plan for failure when putting passion into a game and then hope their one game becomes a black swan and carries them above the competition.

But let's be honest: innovation is hard, especially when you are on a schedule. True creativity comes in synchronicity, and in a team-based environment that's really hard to accomplish without proper leadership that understands more than just game development or the right personalities handling the right jobs, avoiding the double tragedies of job malfunction.

Posted:2 years ago

#6

Morville O'Driscoll Blogger & Critic

1,576 1,419 0.9
I note I haven't actually responded to the article, so here we go. :)

Steam may be hated by a lot of people. You may abhor not having a "true" offline mode. You may not like having to install a third-party store just to play Skyrim. But its DRM works - the encryption of game files, and the CEG protection on the exe, prevents Day-0 piracy (and more), and it treats the customer (generally) fairly. If there is a developer of a store-front that has more faith in - and, in fact, more *love for* - the PC gamer, then it's Good Old Games. Both companies acknowledge that adding value to product is a key point of turning prospective pirates into customers.

Prevention of piracy, on the whole, isn't possible; even the above-mentioned Steam DRM only delays the inevitable. Both companies understand that to keep the consumer buying products, they need to be enticed; that doesn't just mean access to Betas, or soundtracks and artwork, but regularly communicating with the customer with in-your-face charm offensives (that *are* charming), and massive sales. Gabe Newell is famous for replying to random emails from people, and the GOG staff regularly talk about how they hate DRM. This builds brand loyalty, which in turn makes consumers more likely to part with cash when they see something they're tempted by. The feeling the consumer has is that they aren't *just* a cash-cow for either of these companies; that they are in fact part of a community, and that by spending money with them, they are helping the PC gaming world. I'll be honest, and say that I don't *feel* like EA gives a monkey's about the PC gaming sector, and the antagonism that they engender makes me care less about their bottom line than I do about Valve's.

But that's just my opinion.

Posted:2 years ago

#7
I wonder, from a technological and legal perspective, how hard it would be to "stop" piracy altogether. Certainly you could point to "OnLive" and cloud gaming. But, besides my own suspicions, the suspicions of other people and the seemingly desperate sales OnLive has put on ($1 for any game on a new account if you were wondering; I'm not sure if there's anything necessarily blocking you from creating multiple accounts either).

Regardless, it seems doubtful right now that cloud gaming will not be replacing every last other platform out there. Thus piracy continues. What interests me however is the rise of closed mobile systems. Imagine if Microsoft created a cross between X-box and WP7. A closed environment, hardware that runs signed code only, no (convenient) way to jailbreak it; but it's still more of an "Apps" platform than the fixed hardware of current consoles are.

That's what I see as the future, from a technological perspective. Or at least one of the possible ones, after all if Moore's law continues we'll have cheap and quite powerful 16 core tablets by as early as 2018. In other words, by 2020 we'll be slamming against Ahmdal's Law and 64 bit addressable space in a tablet/laptop that costs no more than the launch price of whatever the PS4 will be, or cheaper. Would most games need more power than that? Not until we get to holodecks and etc. So by then, no. And this "walled garden" will stop a lot of piracy, which will encourage a lot developers, which will lead to popularity in sales.

At least that's my randomly popped out thoughts.

Posted:2 years ago

#8

Julian Cram Project Manager, Appster

49 27 0.6
@Morville

It's a load of shit to say game developers need to "create better games". Seriously, what the hell do you want in a game?

We've got some of the best games in the history of gaming come out in the last year. Some of the most in depth, powerful, moving gaming experiences across a range of platforms that push technology to it's limits.

So if you're at a point in your life where you don't think you should pay for a game, then don't. Simply stop playing games and find something you think is more worthwhile to do with your time and your money.

But for fucks sake, don't be a bloody asshole and think it's your right to pirate it because it's not up to your obviously inflated standards!

And if you are downloading a whole heap of crap because you don't like it but think you deserve it, I think you must be wrong in the head. Because why waste your time, bandwidth, and face the potential of criminal charges for something you don't want?

Posted:2 years ago

#9

Morville O'Driscoll Blogger & Critic

1,576 1,419 0.9
Nice. Epic abuse there.

No part of what I said was meant as an excuse for pirating. The point of this article was to promote discussion of how to get people to buy, not pirate. I would've thought that releasing games a month after their console versions in a rather broken form does the very opposite. See also, my comment above re: brand loyalty.

Over and above that, it was a general remark about how piracy is an oft-abused excuse for poor sales, when sometimes the answer is simpler.

Posted:2 years ago

#10
Piracy exists. Used game sales exist. These are facts in the market.

You can choose to respond by hoping that pirates will somehow turn into paying customers. You can try DRM. You can do whatever you choose.

Your goal is to get more sales.

Obviously, you are already making the best game that you can (or can afford to make).

Instead of wishing for a world without piracy, recognize its reality in your business planning. If you are going to take technical measures against piracy, plan them into your game from the beginning. If you are going to implement a marketing or business model strategy, don't wait until you are ready to go gold to start thinking about it.

What we do know is that the anti-piracy rhetoric has done nothing to reduce piracy.

We also seem to see that technical anti-piracy measures have done nothing to reduce piracy. (Oh, by the way, the economic model for most console games means that the console manufacturers have no financial interest directly in reducing piracy - you pay them based on how many disks are printed, not how many are sold).

Based on my experience with publishers, there seems to be little serious anti-piracy planning during the game development process. Just as in the "old" days, piracy planning is delayed until the production stage, not the earlier "green light" stage or any place during the development process.... and certainly there are no anti-piracy firms making a lot of money from the game industry - if publishers really thought there were more sales to be gotten, they would actually invest in security measures. They do not.

The behavior of the game industry in terms of dollars spent shows its real thoughts on piracy, not its ranting.

Posted:2 years ago

#11

Klaus Preisinger Freelance Writing

1,130 1,162 1.0
Is it even possible to establish a platform, if it cannot be pirated?

Sure, once the brand has a certain recognition, such as Playstation, then a, for a long time, impossible to pirate platform, such as the PS3, was doing well. But could the PS1 have achieved the same, if copies were impossible?

In Europe, the NES was nothing but a pale shadow compared to the popularity of the Amiga. During the Super Nintendo/ Sega Genesis years, the Amiga retained some of its market share and the PC grew very fast. The battle for market share between the Saturn, the PS1 and the Nintendo 64 was won by the console which had the most piracy.

Sure, third party and software in general is important, but would the 360 be where it is today, if there were no piracy hacks for it? Apple IOs and Android were basically released with their pants down. DS and PSP were both pirated to hell and back, which only seemed to have hurt one of them. Especially the piracy prone Gameboy survived the Lynx, the Gamepark, the Duo Express and other handheld consoles which did not have the same degree, if any, piracy.

Being able to pirate a game, means the console is worth more in the eyes of the buyer. Bad news for third parties, good news for companies trying to push a platform into the market.

It seems to me the unwritten contract of console manufacturers and customers is this: "we take all your money anyway, so in exchange we allow you to steal back from these guys".

The overwhelming majority of important firmware releases trying to crack down on piracy seem to coincide with first party titles. A majority of third party games now comes with a release day patch. If that cannot be pirated, then at least pirates get the worse experience. What if, each console came with 3G/Edge connectivity, not for downloads, but just to exchange security keys and prevent piracy? Would such a platform last against a competitor "featuring" piracy?

Posted:2 years ago

#12

Morville O'Driscoll Blogger & Critic

1,576 1,419 0.9
To add to the discussion

[link url=http://blog.wolfire.com/2010/05/Another-view-of-game-piracy
]http://blog.wolfire.com/2010/05/Another-...[/link]

[link url=http://draginol.joeuser.com/article/303512/Piracy_PC_Gaming
]http://draginol.joeuser.com/article/3035...[/link]

Two interesting blogs on piracy. The first is fully referenced, too.

@ Julian

And this is what I meant by blaming piracy

[link url=http://www.capcom-unity.com/kramez/blog/2008/08/01/ask_capcom_sven_mostly_roundup_dmc4_sales_and_digital_okami_covers_and_more
]http://www.capcom-unity.com/kramez/blog/...[/link]

"I'm not sure about how Capcom in general feels but It's not doing as well as I would like in the US at retail. It's such a good version and it really deserves better sales. I know it's getting pirated to hell and back (it was up on torrents literally the day it shipped)."

PC Version of DMC 4 went on sale in the US July 8th 2008. It was cracked July 9th by Reloaded. It was released on 360 and PS3 Jan/Feb 2008. And yet the reason for poor sales? Piracy. Not that people hadn't already played it on consoles. Not that it wasn't a game particularly designed for the PC (either in terms of hardware, or PC customer base). Nope.

Posted:2 years ago

#13

John Byrd Principal, Gigantic Software

10 17 1.7
Actard has found the right solution to this problem, e.g. every piece of PC software is a service, not an offline game, and you're basically required to play with an Internet connection on all the time. Yes, this is a phenomenal pain in the ass for consumers; but it also makes the piracy problem significantly smaller, especially for multiplayer play. It also dovetails nicely with DLC and the transition to fully online distribution.

Posted:2 years ago

#14

Liam Farrell

66 13 0.2
I wonder, if there was no way to pirate a game. How many of the people that normally pirate a title, would buy it instead? I don't doubt some people have a unrealistic sense of entitlement and want everything for nothing. But if a publisher's anti-piracy method 100% worked, how much, in terms of sales, would that equal into?

Posted:2 years ago

#15

Klaus Preisinger Freelance Writing

1,130 1,162 1.0
@Liam

Several points of reference exist to test this theory.

The MMO circuit is mostly free of piracy. This did not result in MMOs being more sustainable on average. People do not seem to buy more MMOs because you can't copy them. Thanks to the monthly fee, the average user might pay $90 over his lifetime, instead of $40, but that is about all of it.

The piracy free Saturn did not cause a shift in third party publishers to Sega. The piracy free PS3 (first four years) did not have substantially higher sales when it came to cross-platform titles, compared to the 360 which does have more piracy.

The all important question is another: "which type of piracy is prevented by current DRM techniques". We do not see DRM techniques going after Internet piracy and people downloading games. None of the DRM methods are designed to really do that. Instead, DRM on the PC goes for two things: making it a pain in the butt to lend a game to a friend and making it impossible to sell the game to another person. The same happens on console, it is not so much the Internet piracy which is affected by DRM measures, but rental and reselling.

Posted:2 years ago

#16

Andrew Harris Game Monetization Manager, GameLoft

7 0 0.0
First off, until more "accurate" numbers can be gathered, arguments over losses vs gains are inconsequential. "You can prove anything with facts." All we know is that it exists and that we'd prefer it didn't.

Nevertheless, approaching piracy from the crime and punishment angle simply won't work. Morville hit the nail on the head:

"...adding value to product is a key point of turning prospective pirates into customers. "

It's a question of incentive - if legitimately purchasing the product has more value and is easier than pirating it, consumers will do so. This doesn't mean "make games better." It means reconsidering pricing structures, distribution methods, product support, etc.

Casting a wide net with DRM, updates, ISP throttling/banning, or legal recourse will only ensnare real customers and result in serious negative consequences. Unfortunately, rethinking the aforementioned areas takes more effort and ingenuity than these tacked-on punishment schemes. And no this isn't "fair" but it's the reality.

On a side note: eighteenth-century piracy was more effectively curtailed by appropriating captured pirates into state-run navies than by executing them. They were offered a more valuable, lucrative and legitimate alternative and many took it. Of course it didn't eradicate the problem - nothing ever could - but it's a hint.

Posted:2 years ago

#17

Login or register to post

Take part in the GamesIndustry community

Register now