Paradox: DRM "costs money and makes you lose money"

CEO Fred Wester criticises anti-piracy measures, says Ubisoft's are "2003"

Paradox CEO and co-owner Fred Wester has explained his anti-DRM stance, citing user experience and cost, and argued that for some, it's just a way to cover their backs.

"If you take something like Sony's DRM, SecuROM -- it's a waste of money. It will keep you protected for three days, it will create a lot of technical support, and it will not increase sales," he told GameSpy.

"I know this for a fact, because we tried it eight years ago, and it never worked for us. Two major reasons: it costs money and it makes you lose money, and the other is that it's so inconvenient to customers."

He revealed Paradox hadn't used DRM for around eight years, and argued that for many, the anti-piracy measures are simply a way to please the board.

"If you're a CEO, you need to cover your back. And the people who ask, the board, know nothing about games. They're there because they're some investment company or something, and they ask "So what are you doing to protect our game from pirates?" And then they can reply 'We're buying this solution from Sony.'"

He also thought the current Ubisoft DRM, which requires gamers to maintain an online connection, was "2003."

"People who purchase a game should have just as easy a time as those who pirate the game, otherwise it's a negative incentive to buy a legal copy," he told GameSpy, after explaining his frustrations with Civilization III.

During the interview Wester also shared Paradox's plans regarding the free-to-play business model, admitting it wasn't something that the company had much experience with yet.

"Free-to-play companies analyse the customer. "Well what did this guy buy, and how do we get him to buy the next item?" We don't really have that statistical backend to do that, so I don't think we'd be very successful in the coming year. But after that, it's definitely doable for us, and we're ramping up to do it."

The company is set to publish MMO Salem, set for release in Q3, which will be free-to-play.

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Latest comments (13)

James Prendergast Process Specialist 9 years ago
It's the truth. Another reason why investment systems are out of whack with what industries require.
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gi biz ;, 9 years ago
Glad to see I'm not the only one saying that. Interesting article, it shows a new point of view for me.
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Douglas Kinloch Vice President of Business Development, Metaforic Ltd9 years ago
Not always, things are rarely quite so black and white.
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Show all comments (13)
Morville O'Driscoll Blogger & Critic 9 years ago
Mmm... It does depend on the consumer's point of view, as well as the definition of DRM.

Both Steamworks and "Originworks" are DRM; it's just they're not *just* DRM. Are they a waste of money? Arguably they're not, since they both copy-protect the game (to varying degrees of success), and give value to the consumer, in the form of an in-client store, achievements and a community (though Origin less so on those last 2 points).

But does the consumer *like* these forms of DRM? They're both inconvenient, they both require online activation, if nothing else, and they both *force* themselves on the consumer. For some, the benefits of Steam don't outweigh the online activation and install of a client they didn't ask for. For others, Steam pays for itself in the number of sales it has that benefit the consumer. So, no, it's definitely not a black-and-white issue.
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Luke Giddings Programmer, Supermassive Games9 years ago
"He also thought the current Ubisoft DRM, which requires gamers to maintain an online connection, was "2003." "

I must agree with this sentiment. There are a few Ubi games that I was quite looking forward to buying before I discovered they needed their always on DRM. I know I am not the general case, but some DRM does put off sales.
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Paolo Giunti Localisation Project Manager, GlobaLoc GmbH9 years ago
Morville, I agree with you there. I'm one of those who's normally quite content with Steam, but i also find it irritating when, lacking any internet access, it prevents me from enjoying offline games.
But even this goes in favor to the point made by Mr. Wester: DRMs actually do more harm than good (given, maybe, a few exceptions).
I, for sure, would enjoy Steam and Origin a lot more if they were to provide the same services without having the DRM features.
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Roberto Bruno Curious Person 9 years ago
@Morville: Well, despise their similarities, Steam and Origin are perceived in a vastly different way from customers, and with good reason. So I wouldn't really consider them as the same thing.

Also, many people want their games on Steam cause they don't like being forced to run several clients or front-end and Steam is pretty much the only one widely used, accepted and packed with the best features.
On top of that, Valve has a very good reputation in being extremely customer- friendly and avoiding anti-consumer pratices.
You can't really say the same thing about Microsoft or EA with their services, and other stores (Gamergate, Impulse, D2Drive) are essentially just that: stores, not services.

So Fred Wester's point is still right. DRMs don't help your sales.
If being on Steam helps your sales is cause it's popular by itself as a service and cause it gives you visibility, not for the DRM part.
In fact almost no one sees Steam as a DRM cause for it being a DRM is a less than secondary thing.

In my experience, for every "anti-Steam" person I know there are at least ten supporters (sometime even fervid ones), if anything even just cause it comes packed with useful features, it has the largest PC gaming community out there and cause it doesn't install annoying and harmful stealth drivers on your PC in the attempt to protect data; it just use encryption until the first activation, and that's all.

Oh, and I'd like to point that as a developer making your executable unable to run without Steam isn't a mandatory thing, it's up to you.
In fact there are a few Steam games you can run even without using their client in background.

Edited 1 times. Last edit by Roberto Bruno on 25th January 2012 5:05pm

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Dominic Jakube Student 9 years ago
At this point I think it's safe to say the hackers and crackers have won the DRM war, only online centric games are somewhat imune.Even then there are "illeagal" servers for that with the cheaters that go with it.Look at any torrent serch site and you will see any game on any platform, although Sony seem to be somewhat imune at least on the PS3.I think companies should just realise that some people are always gonna steal, thats just human nature but people can change, a kid who pirates "generic first person shooter 1" may one day buy the sequel when they have more money than time.
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Roberto Bruno Curious Person 9 years ago

Ironically Playstation 3 was the most effective piracy-proof console released by Sony and it was also their first console unable to completely dominate the market.

Of course, lot of people in the industry look at download numbers on PC and they may think "That's scary, we are losing a lot of money here", but recent statistics suggest that in the industrialized world many "pirates" are in fact far more active customers than the average.
It's also worth noting that, always according to these reports, many of these pirates already spend pretty much all they can realistically afford in consumer goods, no one is hoarding the money he's saving with piracy.
Which essentially means that even in a hypothetical scenario where you could stop them from downloading illegal stuff, all you could hope to achieve would be to make them spend roughly the same amount of money in a slightly different way.

Long story short: your software having poor sales could have more to do with you having an ineffective way to attract customers, to give them value for their money and to gain their loyalty than with people eventually downloading for free your software from torrent sites.
Pirates are not a pleasant sight for those who work in the industry, and that's easy to understand, but they are also not very relevant, as preventing them from pirating could hardly make them magically spend more money than those they actually have.
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I hate The recent online pass codes and hope they are forgotten soon.
I haven't used a single one as I feel like I'm lowering the value of my game (which I am)
Sold asscreed revelations due to that and bought brotherhood back.
Same with uncharted 3
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Morville O'Driscoll Blogger & Critic 9 years ago
@ Roberto

Comparing Steam and Origin, I agree with you. Totally, 100%. But EA are slowly-but-surely trying to create their own version of the Steamworks DRM - Battlefield 3 requires Origin to be running in the background, and ME3 might require the same. Even if it doesn't, it still hits a lot of the same things Steam does, even if it doesn't do them half as well - in-client store, online-activation-based DRM, friends list in the client. My point being that both products require a lot from consumers in the same way any DRM requires a lot from them. Not everyone wants something *extra* when they play the game, even if it may benefit them in the end.

Regarding your point about making exes on Steam not call Steam. Yes, true. But Steamworks (that is, the specific form of DRM seen on Skyrim, Dead Island, and Shogun) is funny like that. The initial exe for Skyrim allowed you to run the game without Steam. But then they realised that a big part of Steamworks - the ability to tie a game's exe to the account that bought it - is made obsolete if you allow the exe to just run on its own without calling the Steam client. But other games do allow you to just run the exe - Withcer 2, I believe.
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Sander De Visser Developer 9 years ago
@ Roberto,

First I want to thank you. This has been my view for the last 10 years, (I was 13 then) when I spent all the money I had on computers and games. I still do that with most of my cash, though now I earn more, I also have to pay uni, rent, beer, and food. I still spend any money left after that on computers/games. You just summed it up perfectly!

As for the thing with Steam vs other DRM. Steam had the annoyance issue most DRM has today back in the early 2000's. It has since grown into a service many people enjoy. That, I think is the main difference. Where most DRM is just plain annoying and feels like it punishes you for buying the game (Instead of a pirated version, which, frankly, is a lot less "hassle" then buying a physical copy in a store and usually doesn't have any DRM), whereas Steam is actually better then a download. It's faster (usually), installs easily, and updates automatically.
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Nicholas Pantazis Senior Editor, VGChartz Ltd9 years ago
I actually think the issue of DRM is quite black and white. No DRM has ever benefited a game's sales or profits to any extent at all in human history.

The only slight exception to this is if you consider Steam DRM, and Steam is a service and by nature of the service has certain requirements to continue providing effective service. Even then, Steam allows you to play your entire library in offline mode.
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