Controversial games retailer G2A found itself under fire during an on-stage Q&A at Reboot Develop today.
In a discussion hosted by our very own Dan Pearson, G2A senior account manager Mario Mirek found himself fending off questions about grey market sales, harmful industry practices and a convoluted protection system.
Mirek had arrived at the event to talk about G2A's new Direct service, which is the retailer's effort to open itself up to the games industry and become an 'open door' for developers to speak with them. And speak they did.
The G2A exec began by talking about the company's user base of 13m customers, who are engaged in "2.5m transactions a month". Pearson then challenged the firm on how the retailer effectively enables grey market selling.
"Absolutely not," countered Mirek. "I know we're called a grey marketplace, but the way we see it - and the way our team sees it - is that there's nothing really grey about it. People just don't understand our business model. This is a place where people can buy and sell unactivated digital codes, 95% games and 5% other various software."
"I know we're called a grey marketplace, but the way we see it - and the way our team sees it - is that there's nothing really grey about it"Mario Mirek, G2A
Of course, grey market is simply a term used to describe the legal sale of products through distribution channels not intended by the manufacturer. G2A has a reputation for enabling people to buy keys in bulk from other countries (where the price is cheaper) and sell them for a profit in more expensive territories. That's pretty much the definition of 'grey market'. Mirek defended this, however.
"We've noticed really quickly that the gamers want to access your games. They don't have $60 or $70 to acquire the game day one. The codes on G2A come from various places, from sales or bundles or people who have acquired keys at some point and changed their mind. Customers have the right to sell their products at the price they want to sell at, just like on eBay or any other marketplace. We have developers, we have publishers - the list is available on G2A of who is participating - so developers and publishers see that this is a marketplace that can no longer be ignored. We have customers ranging from 16 to 20 years-old. They don't necessarily have the money to spend on their favourite games. They can do one of two things: they can go on their favourite marketplace and add a game to their wishlist to pick up when it is in a sale, or they can go on G2A and find someone who bought the game earlier, but for whatever reason doesn't want it anymore, and buy it off of them."
Mirek was then challenged on how many keys are bought in one territory, then sold into another. He said he was glad we're addressing this, before adding: "The digital key, in itself, contains no information. It doesn't tell you if it's a promo key or a retail key or a region key... it doesn't tell you anything. So the only way we can monitor the marketplace, and look at those keys, is to verify those sources. So that's why we launched G2A Direct, which is why I'm here. Now G2A Direct is very young. Is it perfect? No, it's not. But there is a team of people that wants to help them and give them access to the marketplace, to the data. Developers can contact us, we have an open door policy, and we can look at those keys and tell them what is going on.
"But we ourselves... everyone is telling us that keys from this region are appearing on G2A at a lower price, but everyone is ignoring the fact that the key itself doesn't contain that information. If a developer or publisher...wish to contact us and find out what is going on, we are happy to share that information with them."
G2A Direct allows developers to generate some revenue from sales from third-party sellers, and also allows companies to directly monitor what keys are being sold. But studios don't have to be part of the Direct programme to speak with the retailer.
"If you're not a Direct developer, you don't need to be in the programme to find out about your keys," Mirek said. "We have an open door policy, any developer here can email us at developers@G2A.com, and one of our team members will be happy to help. There is nothing we want to hide."
However, he stopped short of saying G2A would block the sale of codes that originate from other markets.
"We give customers the right to acquire the keys wherever they want and sell them where they want," he said. "What we monitor very closely is if the key has been purchased in a legitimate way. Listen, 13m people from all over the world are coming in to purchase your game, they want to play your game. Obviously, they will be looking at the value. The way we see it is that we have given those customers that freedom to purchase. And developers and publishers who participate, they can see what is going on. Really, it is about your user acquisition. Why are you putting your games on sale? Why are you doing bundles? Why are you doing giveaways? For that very reason - because you want to acquire a customer who might otherwise not buy your game. To remind you, we are the largest marketplace in the world, but we are not the only player out there. If a customer comes to us and purchases your game, then you already have that customer and that key has been paid for - one way or another."
He was later challenged by a developer in the audience who asked if G2A really doesn't see this being damaging to the industry. Mirek replied: "You have to ask yourself how those keys got their in the first place." This was followed by the developer saying: "Probably just from Steam. If that happens, can you region lock the code?" Mirek said: "We have that ability."
Then came the topic of stolen keys being sold on the platform. Mirek said it remains a problem, although he claimed G2A is proactive in preventing it. "Our job is to make sure we are the safest marketplace out there," he commented. "We want our customers to be sure that when they acquire a key, it is going to work. That obviously requires an enormous amount of resource. We have people working in anti-money laundering, we have people working in risk and finances. We have people working in transactions. It is in our best interest to make sure that the codes that appear on G2A have been acquired legitimately. Things like theft and charge backs... it's not just our problem, it's the problem of any major marketplace."
Mirek said the firm doesn't just remove the stolen keys from the site: "We are also finding out where those keys are coming from, who is selling and we can take action against those sellers. Removing the keys... you're just taking a painkiller, you're not removing the cause. By finding out who is doing it... it is easy to get in, but people forget that once they sell those keys, they have to withdraw that money. They have to go through a very rigorous AML (anti-money laundering) process and provide their banking information. We have that. We can block those funds. We are removing fraudulent keys that they are selling and we are blocking and removing the seller so that it can protect other developers, too."
Mirek reiterated that a lot of the problem stems from G2A's bad performance in communicating itself to developers, and suggested that a lot of the criticism is mostly 'factoids being perpetuated'. Pearson brought up previously spikey conversations between the retailer and developers on Reddit.
"Reddit has called me a dodgy drug dealer, so I don't think it can get any worse than that"
"Reddit has called me a dodgy drug dealer, so I don't think it can get any worse than that," remarked Mirek. "But the company listens, the company monitors pretty much all channels. We know what is going on, we know there is room for improvement. But you guys need to realise, this is a 750-person operation. I am happy to announce that 40% of those are women and most of them are gamers. So any change will take a while. But we are being proactive, making sure that our marketplace is safe and secure for customers and content creators."
It was suggested that the studio only ever changes when it is 'backed into a corner', an accusation that Mirek didn't address directly. Instead he said he is hearing what people are saying and working on it. He acknowledged that getting developers to check keys themselves is a big resource, but said if studios email his team with a large batch of keys, they will look into it for them. He said turnaround for this sort of investigation can be two to three days, although longer during busy periods.
"Then you have that information so you can take whatever steps you need from your end."
Naturally, the recent controversy surrounding Gearbox's support for G2A and sudden cancellation of that deal came to light. Gearbox Publishing had partnered with G2A on the collector's edition of Bulletstorm: Full Clip Edition. A swift backlash followed and Gearbox reacted by issuing a series of demands to G2A (demands compiled with help from YouTuber Total Biscuit). The demands were apparently not met and Gearbox ended the deal.
"We had been in touch with Gearbox for a few months," Mirek said. "We worked closely with Gearbox Publishing and sharing the information that they have requested. We were very surprised to learn that, instead of contacting us, they decided to publicly end the relationship because of comments made by a YouTuber. We were disappointed, but we wish Gearbox the best, we wish People Can Fly the best. We have always had our doors open. So if they decide to reach out again, we will be welcoming to that. But you need to realise that Gearbox Publishing is not the only major company we are talking to. We were very sad, very surprised and it was disappointing the way it happened."
Another developer in the audience then asked if they planned to change their business practices following the incident.
"We were very surprised to learn that, instead of contacting us, Gearbox decided to publicly end the relationship because of comments made by a YouTuber"
"If anyone thinks that their business doesn't deserve a change, then they're wrong," continued Mirek. "Obviously we are going to focus on improving ourselves. But I must stress, Gearbox Publishing had been in touch with us for months in advance and could ask anything they want. We had met with People Can Fly, we had given them everything they wanted. We issued a joint press release with Gearbox, and nothing we said went out without permission from Gearbox.
"Obviously, we want to make sure this doesn't happen in the future."
Pearson brought up the fact Total Biscuit has vowed not to cover companies that work with G2A, and challenged Mirek on how he can turn around this perception.
"We know there are factoids being perpetuated," Mirek answered. "Nobody has looked at the real numbers or the data. We are disappointed our deal fell through because of a YouTuber, but the reason I am here, and you are here, is that you can contact us, speak to us, and find out what is really going on. Then you can base your business decisions on real information, and not false speculation."
Additional criticism was made of G2A Shield, which is effectively a membership scheme designed to protect customers from fraudulent keys. Questions were raised about how difficult the system is to deactivate and the value it really offers customers.
"When I came to this room, I had the getaway car ready in case something would happen," joked Mirek. "We know that the service is not perfect. We have heard the people saying how difficult it is to deactivate. We have seen the posts and the photos. That will change. With a website of this scale, it can take a while."
Indie developer Mike Bithell then posed a question: "You charge the customers who want to avoid fraudulent stuff with the Shield system. You ask us to contribute our time and energy to detect fraud on your system in exchange for 10 per cent. I'm interested what the 750 people - 40 per cent of whom are women - are doing to earn the 90 per cent of the transaction?"
"There are people working in marketing and risk," responded Mirek.
Bithell laughed. "Is it mainly marketing?"
"No. IT and security."
Come the end of the discussion, Mirek thanked the audience for "not killing me".