When Alex Childs saw that The Witcher III on PlayStation 4 during one of the platform's Flash Sale promotions for about $25, he was sold. As he went off to work that day, he made a note to buy it when he got back home, only to find out later the sale had ended while he was out.
As he recently told GamesIndustry.biz, "I was staring at the screen, at this $60 game that was just $25 a few hours earlier, and I thought, 'This is just the dumbest thing in the world.' I'm a consumer that's willing to pay probably $35 to get this game. It's in everyone's best interests to let that transaction occur. The publisher is better off because not only do they get $10 more than the sale price but they have a customer who's interested, who has purchase intent, and they're essentially turning them away. And I as a consumer now am frustrated, and there's no great option me."
Childs ended up buying The Witcher the next time it went on sale, that time for $20. So he lost out for having to wait longer to play the game, and the publisher lost out for selling it for almost half of what he would have been willing to pay.
The experience served as the driving force behind Childs' new venture, LBO (short for Last Best Offer), a digital distribution storefront where he serves as CEO. Each LBO product page gives a game's suggested retail price, then includes a field where users can type in their own offer instead. An algorithm that takes into account the publisher's absolute minimum acceptable price and the average offer price on the site determines if the offer is acceptable. If not, it provides a counter-offer. Childs said there are a number of measures in the algorithm to keep people from gaming the system and ferreting out the minimum selling point, along with a dash of randomness.
"One of our publishing partners called it 'Priceline for games,' and I think that's kind of how we would like to position it," Childs said.
"What we're trying to do is be a responsible actor to figure out where the fair price of a game is..."
The storefront officially launched today with a modest selection of 15 indie games from Curve Digital, Digerati Distribution, KISS Ltd., TinyBuild, and Frogmind. While the quantity of titles isn't overwhelming, some of them are quite well regarded, including Stealth Inc. 2: A Game of Clones, Badland: Game of the Year Edition, The Flame in the Flood, and No Time to Explain: Remastered Edition. So far the site is focusing mostly on games well outside their release window, and see it as a good option for publishers to turn to before they throw games into a bundle.
"A big part of what our site is trying to do is act as a mediator between publishers and gamers," Childs said. "If a publisher says we're going to sell our game for $30 and we get a bunch of gamers saying, 'Well we'll pay $25 for it.' That's information we can take to the publisher and kind of say, 'Maybe this game isn't worth $30. Maybe it's closer to $25.'"
It also could work the other way, as publishers thinking about dropping a full price game to $30 could put it on LBO and discover that gamers by and large are willing to pay about $45.
"That means gamers are paying a little bit more, but what we're trying to do is be a responsible actor to figure out where the fair price of a game is and ensure a game that's two months old isn't getting devalued to a point it shouldn't be devalued at," Childs said.
Currently the games on offer are limited to catalog PC games redeemed through Steam codes, but they are hoping to eventually expand to consoles and would be interested in working with DRM-free marketplaces as well.